Results for Q2 2007
Best Quarterly Results to Date
Substantial Growth in Reserves and Cash Balance

8 August 2007 - European Goldfields Limited (AIM: EGU / TSX: EGU) ("European Goldfields" or the "Company") today reports its results for the second quarter to 30 June 2007. Highlights are:

Corporate highlights

• Acquisition of an additional 30% interest in Hellas Gold at an accretive price
• Strategic alliance with Aktor and its parent company Elliniki Technodomiki
• C$138 million equity financing completed in the period

Financial highlights:

• Sales increased by 142% to US$42.0m in H1 2007, compared to $17.4m in 2006
• Profit (before tax) of $16.6m in H1 2007, compared to $1.3m in 2006
• Operating cash flow increasing to $19.0m in H1 2007, up $14.5m over 2006
• Working capital of $211.6m at 30 June 2007, compared to $36.5m in 2006

Operational highlights:

• Stratoni: Grades higher than expected
• Skouries & Olympias: Ministry of Development completes review of business plan - Significant milestone for permits
• Skouries: Contract signed with Outotec Minerals OY for the purchase of mill and plant equipment
• Olympias: Refurbishment plan underway
• Certej: Pilot scale continuous test confirmed 90% gold recovery using the Albion Process
• Certej: New mineralisation discovered in open pit

Commenting on the results, David Reading, Chief Executive Officer of European Goldfields, said: "These results demonstrate that European Goldfields is on track to become a mid-tier producer. The successful financing and the alignment of shareholder interests, combined with growing production and profitability underpin the Company's strategy of generating excellent and sustainable returns for investors.

"We are also pleased with the permitting process for our gold projects with a further step completed in the period.  European Goldfields is now well placed to unlock the further value from these projects with its strategic partner Aktor and realise the value of our reserves for our new and existing shareholders".

Conference Call & Webcast - 8 August 2007 at 10am EST / 3pm GMT
European Goldfields will host a conference call on Wednesday 8 August 2007 at 10:00 a.m. ET / 3:00 pm (London, UK time) to update investors and analysts on its results. Participants may join the call by dialing one of the three following numbers, approximately 10 minutes before the start of the call.

From North America: (Local) 416-644-3423 or (toll free): 1-800-589-8577
From the U.K. & France (toll free): 00-800-0000-2288
From Austria, Belgium, Denmark, Germany, Ireland, Iceland, Netherlands, Norway, Sweden, Switzerland and Italy (toll free): 00-800-0022-8228

A live audio webcast of the call will be available on: http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID47880

For those unable to join the live conference call, a replay will be available until 15 August 2007 at midnight by dialing (toll free) 1-877-289-8525 or 1-416-640-1917, Passcode 21241908#.

SELECTED FINANCIAL DATA

European Goldfields' unaudited interim consolidated financial statements and management's discussion and analysis for the three- and six-month periods ended 30 June 2007 and 2006 are filed on SEDAR at www.sedar.com.

CORPORATE ACTIVITY

Acquisition of an additional 30% interest in Hellas Gold - On 29 June 2007, the Company completed the acquisition of an additional 30% interest in Hellas Gold S.A. ("Hellas Gold"), increasing its stake to 95%. The purchase price was agreed at US$178 million, which incorporated a 15% discount to the "see-through value" of Hellas Gold.  The purchase price was paid by the allotment to the vendor of 35,447,246 common shares, representing 19.9% of the issued and outstanding shares of the Company on a diluted basis, and the balance of US$8.4 million in cash.

This transaction was, in essence, a share swap and reinforces a strategic alliance with Aktor S.A. ("Aktor") and its parent company Elliniki Technodomiki TEB A.E. (ATHEX: ELTEX) ("El-Tech") in that approximately 95% of the purchase price was paid to Aktor in common shares of the Company. Of the cash portion, 50% will be re-invested by Aktor into Hellas Gold, as funding towards maintaining its residual 5% shareholding interest in Hellas Gold.

El-Tech is a large Greek conglomerate with a market capitalisation in excess of US$2 billion and investments in four fields: construction, concessions, energy and real estate. Aktor is Greece's largest construction company.

Furthermore, to demonstrate and confirm its long-term commitment to the Company and its projects, Aktor has agreed not to sell the European Goldfields shares it received as consideration until the date on which gold production commences in Greece (or four years after the closing of the Acquisition, if earlier).

Cdn$138 million equity financing - Concurrently with the Acquisition, the Company completed a treasury offering of 27.6 million shares, for total gross proceeds of Cdn$138 million.  The Acquisition combined with the treasury offering resulted in a 50% increase in the Company's market capitalisation.

Attractive price secured on Stratoni silver stream sold to Silver Wheaton - In April 2007, Hellas Gold agreed to sell to Silver Wheaton (Caymans) Ltd. ("Silver Wheaton") all of the silver metal to be produced from ore extracted during the mine-life within an area of some 7 km² around its zinc-lead-silver Stratoni mine in northern Greece (the "Silver Wheaton Transaction"). Silver production at Stratoni is a by-product of lead-zinc operations.

The sale was made in  consideration of a prepayment to Hellas Gold of US$57.5 million in cash, plus a fee per ounce of payable silver to be delivered to Silver Wheaton of the lesser of US$3.90 (subject to an inflationary adjustment beginning after year three) and the prevailing market price per ounce.  The current Stratoni proven and probable silver reserve contains approximately 12 million ounces of silver. 

The deal amounts to $11.59 of revenue per payable reserve ounce of silver, compared to the current silver spot price of $13.14/oz.  On a discounted basis (at 10%), this amounts to $10.39/oz of payable silver reserve, compared to the current discounted silver spot price of $10.34/oz.

The Silver Wheaton Transaction does not apply to any additional silver resources within Hellas Gold's 317 km� of mining and exploration licences in northern Greece, for example silver resources at Hellas Gold's other mine of Olympias, except for a right of first refusal granted to Silver Wheaton on similar future transactions over the Company's silver assets.

STRATONI OPERATIONS (GREECE)

Highlights:

• Better grades achieved
• Development for continued production ramp-up in 2007
• New mineralisation discovered at Stratoni

Consistent production from Stratoni - Hellas Gold mined a total of 53,088 tonnes of ore in the second quarter of 2007 and 108,157 tonnes during the first half of 2007 at its Stratoni mine, which represents the best half-yearly production to date from the Stratoni mine and mill. Hellas Gold completed eight shipments of concentrates from Stratoni in the second quarter of 2007 and 13 shipments in the first half of 2007. This translates into the following sales of concentrates:

* Net of smelter payable deductions

Ore production rates from underground have steadily increased from 400 tonnes per day in the first half of 2006 to a steady 850 - 900 tonnes per day in the first half of 2007 and the mine now operates effectively at these levels. The rate of ore production is expected to continue to increase up to the end of 2009. This expected increase is supported by the current development plan and the new decline which is scheduled for completion by end of 2007.

Better grades achieved - Mined grades have continued to be in line with the high levels experienced in the first quarter of 2007.  On average, mined and processed grades have been on average approximately 18% higher than reserve grades in the first half of 2007.  As a result, concentrate production and sales are at high relative levels.

Forecast ore production for 2007 has been reduced by approximately 10% from the originally forecasted 250,000 tonnes due to bad ground conditions in the upper area of the mine, reducing the access to faces required for expanded operations.  However, this is not expected to affect forecast metal production as grades have been significantly higher than expected in 2007.

Development for continued production ramp-up in 2007 - An internal ramp to access the upper parts of the mine is on-going and is providing access to new working ends in the upper part of the mine to ensure the ramp-up in production continues in 2007. The new decline to the Mavres Petres orebody, critical to future production ramp-ups and ventilation, is over 1,400 metres and advancing satisfactorily.

The two filter presses designed to maximise the utilisation of storage space for fine tailings will be commissioned in the third quarter of 2007. The backfilling of old mine workings with coarse tailings to create additional tailings storage space on surface has resulted in a total of some 20,000 m3 of void in the old Madem Lakkos mine workings being filled to date. This backfilling should also reduce mine water pumping and treatment costs. The second water treatment plant at the Stratoni mine site is scheduled to be commissioned in the third quarter of 2007 to improve efficiency and provide capacity for extreme rainfall events.

New mineralisation discovered at Stratoni - New mineralisation has been encountered during the excavation of the new decline running between the existing reserve and mined-out areas at Madem Lakkos.  Average grades from panel sampling compare favourably with current reserves.  A drill programme designed to define at least 200 metres of strike and 75 metres of dip extent has commenced with results expected in the fourth quarter of 2007.  The new decline will enable immediate access for mining of any new discovery in this area.

Drilling of Stratoni extensions - In October 2006, European Goldfields began an exploration drilling programme at Stratoni with the aim to significantly increase reserves and life of mine.  The two targets being investigated first are known extensions to previously mined areas of the Stratoni (Madem Lakkos) deposit, where production grades of 9.0 to 10.7% lead, 9.0 to 9.6% zinc and 160.0 to 185.3 g/t silver are recorded. Drilling to date has confirmed to date the geological model.

The drilling programme will also investigate the inferred resources previously reported for Stratoni (see the Company's press release of 8 January 2007), which form extensions to the western deposit at Stratoni (Mavres Petres). The drilling programme is designed to upgrade these inferred resources to the measured and indicated categories. These inferred resources are extrapolations from the known reserves and comprise some 555,000 tonnes grading 7.3% lead, 10.2% zinc and 181 g/t silver.

SKOURIES & OLYMPIAS PROJECTS (GREECE)

Highlights:

• Sales of Olympias gold concentrate on track 
• Olympias refurbishment plan underway
• Contract signed for purchase of mill and plant equipment
• Ministry of Development completes review of business plan

Sales of Olympias gold concentrate on track - Hellas Gold's Olympias project benefits from an existing stockpile of gold-bearing pyrite concentrates representing, at December 31, 2006, a reserve of approximately 252,000 tonnes grading 23.3 g/t gold (containing 188,000 oz of gold), in addition to substantial underground reserves of gold, lead, zinc and silver.

Hellas Gold completed eight shipments of gold concentrates from the Olympias stockpile in the second quarter of 2007 and 18 shipments in the first half of 2007. This translates into the following sales of concentrates:

Hellas Gold has secured to date the sale of a total of 209,000 wmt of Olympias concentrates (containing approximately 148,000 oz of gold) over a three year period to four different companies - Golden China Resources Corporation (formerly Shandong MIC Biogold Ltd.), MRI Trading AG, Opeloak Limited (a subsidiary of Celtic Resources Holdings Plc) and Euromin S.A. - with expressions of interest to sell up to an additional 132,000 wmt of concentrates if the initial shipments are successful.  Hellas Gold expects to sell a total 100,000 tonnes of gold concentrates in 2007 under the terms of these agreements.

Hellas Gold plans to resume underground mining operations at Olympias after permits are awarded, producing more gold bearing pyrite concentrates for sale to existing and new off-take purchasers.

Olympias refurbishment plan underway - Preliminary work has already been initiated to realise the start-up at Olympias.  The main mine infrastructure consisting of ventilation, dewatering and hoisting are all operable and entry to the workings is available from the existing ramp.  An engineering audit of the underground mine facilities has been completed and will be put into effect once permission to proceed is received.  Similarly, the fabric of the existing concentrator is sound.  An audit of the plant has been undertaken and the international contractor Outotec Minerals OY inspected the facilities in July 2007 and concluded that the plant could be brought back into efficient operation at relatively modest cost.

It is firstly planned to reclaim and process the 2.4Mt of stockpiled tailings arising from the previous operations at Olympias.  This material will be fed into the plant either alone or blended with mined ore and will produce the gold bearing pyrite concentrate similar to that which is already being sold.  The residue from the concentrator plant will be directed to a backfill plant where the course fraction will be mixed with a small quantity of cement and used to fill the underground voids at Olympias; the fine fraction will be filtered and the dried product transported for storage at the tailings management facility at the nearby Stratoni mine.  In this way, the environment will be improved at the Olympias site and all future tailings managed in a responsible manner utilising best practice.

Skouries technical feasibility study nearly completed - Hellas Gold has completed most technical studies for the final bankable feasibility study on its Skouries gold-copper project. These studies include:

• A cost and definition study for the process plant and associated infrastructure, undertaken by Aker Kvaerner Engineering Services
• A cost and definition study for underground mechanical and electrical utilities, undertaken by Scott Wilson Mining
• The design of the tailings management facility, undertaken by Golder Associates
• A study of hydrogeology and creek boundaries by the Greek Institute of Geology & Mineral Exploration (IGME), to be used in the development of a new hydrogeological model
• A reserves estimate, undertaken by SRK Consulting
• Mining studies undertaken by SRK Consulting, Scott Wilson Mining and other international consultants.

Mining studies carried out to date confirm that Skouries can be mined as a low strip open pit operation and as a highly productive underground mine. This would produce annually up to 43,000 tonnes of copper and 220,000 oz of gold over a mine life of over 20 years. This production rate is shown to be sustainable based on the detailed mine design carried out by independent external consultants and benchmarking with other comparable mines.

Outstanding work on the bankable feasibility study consists of the incorporation of the environmental impact study and minor optimisation studies on landtake positioning around the open pit, water diversion and costs in the open pit.

Contract signed for purchase of mill and plant equipment - Hellas Gold has signed a contract with Outotec Minerals OY for the purchase of mill and plant equipment. Hellas Gold is also negotiating with Aktor S.A. for the construction of the plant and related infrastructure after permits are received.  In June 2007, a deposit of ?6 million was paid to secure the fabrication of the primary SAG and ball mills and for Outotec to commence with basic design. A testwork programme has been agreed with Outotec and will be carried out at their laboratory in Finland during August 2007.  The programme is aimed at optimising the gravity gold recovery and dore production system, and establishing basic design criteria for the concentrate regrind mill, the concentrate thickener and filter.

Ministry of Development completes review of business plan - In July 2007, Hellas Gold received a formal letter confirming that the Greek Ministry of Development had completed its review of Hellas Gold's business plan submitted in January 2006 for the joint development of the Skouries and Olympias gold and base metals projects in Northern Greece.

In the letter, the Ministry of Development also re-declared its positive opinion of Hellas Gold's preliminary environmental impact study ("PEIS") which has already been submitted, and formally requested the Ministry of Environment to issue its official approval of the PEIS.

The letter also states that the Ministry of Development "is in agreement with the development of the project described in the business plan, as this investment is particularly beneficial to the national and local economy (.) and reflects the intent of the contract signed between the Greek State and Hellas Gold".

This letter is addressed to Hellas Gold and the Ministry of Environment and represents a statement of support for the projects based on detailed studies completed by appropriate technical and advisory bodies appointed by the Ministry of Development.  This letter represents the foundation for the fulfilment of Hellas Gold's business plan for Skouries and Olympias, in compliance with the Greek and EU legal framework.

The business plan focuses on a phased approach to the development of the Skouries gold-copper porphyry deposit and the Olympias gold-lead-zinc-silver deposit. The principal revenue stream in the early phases will be through the sale of concentrates. Hellas Gold's current plan is to develop Olympias in three phases to allow refurbishment of existing infrastructure and the subsequent construction of new gold processing facilities at Stratoni. Skouries will initially be mined as a low strip open pit operation, followed by highly productive underground mining.

This letter from the Ministry of Development re-confirms an earlier statement made by the General Secretary of the Greek Ministry of Development, Mr Nikos Stefanou, when he publicly stated that the Government of Greece fully supports the development of mining projects in Chalkidiki, the region where the Skouries and Olympias projects are located. In his speech, Mr Stefanou stated that "The mining industry is extremely important for the regional development of Greece" and more specifically that "The government supports the development of the gold mining business in Chalkidiki, according to the environmental framework. The execution of this initiative will develop this region and provided work for 600 people in the construction phase and 1300 people in the production." The speech was made on 10 May 2007 in Athens and is available at www.ypan.gr/c_announce/45_3927_cms.htm.

Hellas Gold is currently finalising a full environmental impact study ("EIS") which is expected to be submitted to the Greek government in the fourth quarter of 2007, addressing any comments received on the PEIS.  On approval of the EIS, the environmental permits for Skouries and Olympias are expected to be issued.

Hellas Gold will then submit to the Greek government a final technical report on the Skouries and Olympias projects, which will restate the principles of the business plan and take into account any conditions detailed in the environmental permit. The mining permits are expected to be issued on approval of the technical report by the Greek government.

Permit-wide exploration under way - Twenty exploration targets identified - Hellas Gold holds 317 km� of highly prospective exploration licences in northern Greece. Recent work by Hellas Gold has highlighted a total of twenty exploration targets, including six advance targets and extensions to known deposits, seven targets of known mineralisation for follow-up work and seven conceptual targets. 

A programme of mapping, reinterpretation and modelling has been undertaken on the Piavitsa advanced target.  This polymetallic massive sulphide target comprises a 6 km mineralised structure with a 3.5 km central zone expressed by old manganese oxide open pits.  Within the zone, seven holes drilled by the previous owners over 1,300 metres of strike length and some 500 metres of known down dip extent define three mineralised horizons averaging 12 metres width including high grade zones averaging around six metres width.  Grades within the intercepts ranged from 0.3 to 22.2 g/t gold, 0 to 533 g/t silver, 0 to 26% zinc and 0 to 12% lead.  The current programme has confirmed the potential of the Piavitsa target over a three kilometre strike length and has identified a high grade shoot within the main horizon.  The work also identifies previously unsampled horizons of potential economic mineralisation and points to the possibility of furthe r high grade shoots at depth.  These targets will be tested with geophysics in the second half of 2007 and subsequently drilled out.

Pilot ground-based geophysical programmes have now been completed over known mineralisation at Olympias and have proven the effectiveness of EM geophysical surveys over areas that are prospective for massive sulphide mineralisation.  On the basis of these results, Hellas Gold plans to fly airborne magnetic surveys over the entire licence block and airborne EM surveys over the massive sulphide belts in October 2007.  The airborne surveys are aimed at identifying new target areas and prioritising these with existing targets in preparation for drilling in 2008.

CERTEJ PROJECT (ROMANIA)

Highlights:

• Technical feasibility study submitted
• Albion Process Technology achieved 90% gold recovery in continuous pilot plant tests
• New mineralisation discovered in open pit

Technical feasibility study submitted - In March 2007, European Goldfields submitted a Technical Feasibility Study ("TFS") to the Romanian government, in support of its permit application to develop its 80%-owned Certej project.

The Certej reserve for the sale of concentrates contains 27.7 million tonnes of ore grading 2.0 g/t gold and 11.6 g/t silver, representing 1.76 million ounces of gold and 10.4 million ounces of silver. The deposit extends from surface and will be mined by open pit methods with a strip ratio of 3.4:1.  The project will involve the mining and processing of 3.0 million tonnes of ore per annum over at least nine years.

The metallurgical process design is based on extensive comminution and flotation testwork to produce a gold bearing concentrate and then processing by means of the Albion Process. The project is expected to yield an average of 308,000 tonnes of flotation concentrate per annum with high grades ranging between 17 - 19 g/t gold and 80 - 130 g/t silver (depending on the source of the ore in the deposit), with a flotation gold recovery of approximately 90%, followed by an Albion gold recovery of approximately 90%, resulting in a total process gold recovery of 81%.  This translates into an annual planned production of approximately 168,000 oz of contained gold in the concentrate.  The flotation concentrate will then be directed to the Albion Process section of the plant for recovery of gold and silver as dor�. The Albion Process is a combination of ultra-fine grinding of concentrates and oxidative leaching at atmospheric pressure. The liberated gold and s ilver is then recovered as dor� by the conventional Carbon in Leach process.

The residues from the flotation and gold plants will be disposed of in two separate but adjoining tailings management facilities. 

Albion Process Technology achieved 90% gold recovery in continuous pilot plant tests - European Goldfields is currently completing an extensive metallurgical testwork programme using the Albion Process at the facilities of Hydrometallurgical Research Laboratories Testing ("HRL") in Australia. Small scale batch tests had achieved gold recoveries of 90-93% and established the optimum conditions for the continuous pilot plant testwork required to prove the amenability of the Albion Process for the Certej concentrate.

A Phase 1 pilot scale test was carried out which confirmed that gold extractions in excess of 90% could be achieved on a continuous basis at sulphur oxidation rates in the Albion Process of around 70%.  The testwork also confirmed the consumable levels were in the expected range.

A programme of flotation concentrate grade optimisation work was then undertaken and on completion a second Phase 2 continuous pilot plant run was completed in June 2007. This confirmed the high gold extractions of 90% achieved in the Phase 1 run and that the flotation concentrate is amenable to treatment by the Albion Process.  Further optimising work and equipment tests by vendors are also nearing completion and a final design report will then be issued by Core Resources and Xstrata Technology allowing an engineering design company to calculate costs for the bankable feasibility study. 

During the testwork campaign at HRL, a large batch scale Albion test was completed on the concentrate from the West ore zone of the Certej deposit which had previously proved to be unresponsive to the Albion Process.  This work demonstrated that by applying a slightly higher oxidation rate, a gold recovery of 90% could also be achieved from the West ore zone.  This is a very positive result as it could increase the operating life of the Albion Process by at least two years.

A definitive mineralogical study describing the four ore zones of the Certej deposit was completed by Amtel of Canada which indicated that there is potential for increasing flotation gold and silver recoveries above those achieved in the laboratory scale tests.

Environmental impact study nearing completion - In 2006, European Goldfields completed all the necessary Environmental Impact Assessments (Levels I and II) and a Social Impact Assessment Study in support of its permit application to develop the Certej project.

Work is now progressing well on the Certej environmental impact study ("Certej EIS"), which is due for completion in the third quarter of 2007 after some contributory studies are finalised.  The Certej EIS will have been carried out over a period of a year to cover the four seasons for accumulating certain required base line data.  The Certej EIS is a detailed multi-discipline study assessing the environmental, social and health impacts of the project on the affected area.

Final bankable feasibility study to be completed by end-2007 - Once the EIS is completed, European Goldfields expects to complete a bankable feasibility study ("BFS"), which will be used for internal approval and presentation to banks and other sources of potential financing of the project.  The BFS is scheduled for completion by the end of the fourth quarter of 2007.

A contract to undertake an engineering study of the process plant and associated infrastructure has been awarded to Aker Kvaerner Engineering Services.  This will include the final results of the completed Albion Process testwork programme, the design criteria package for the Ultra Fine Grinding IsaMill and the leaching process with the associated costs.  Site visits have been undertaken to gather the additional design and site data needed to produce the definitive cost estimate and study.

The BFS will include a final open pit optimisation study, which will take into account the latest testwork and the effect on assessing ore extraction and processing economics and include the positive results of the completed infilling drilling programme to convert inferred resources within the pit area to the indicated category (see table below). Conversion of inferred resources is expected to provide an additional year of feed to the Certej plant.

Clear path to permitting - European Goldfields has established a clear path to applying for permits to develop the Certej project, having already submitted the TFS to the Romanian government in March 2007, which will be followed by the submission of the EIS in the third quarter of 2007.

In September 2006, European Goldfields announced that the Hunedoara County Council had issued a General Urbanisation Certificate for the Certej project.  The certificate confirms the designation of Certej as an industrial mining area and confirms local community support for the project. This important milestone is the first official step in the permitting process for Certej.

All mining permits and a detailed urbanisation plan are expected by mid-2008 following a standard public consultation process with the local community.

New mineralisation discovered in open pit - Exploration in Romania has focused on extending the life-of-mine of the Certej project. This comprises drilling out inferred resources and deeper, potentially high grade feeder zones, in-fill drilling and metallurgical testwork on satellite deposits, investigation of high grade vein deposits near to the project that could increase the feed grade in the early project life and the development of targets that could enhance the value of concentrates produced, by the addition of copper rich material for example. Drilling to convert inferred resources (currently treated as waste where they fall in the open pit) to the indicated category has now been completed.

In May 2007, European Goldfields announced that significant drilling intercepts have been encountered at Certej. In July 2007, European Goldfields completed a Diamond and RC drilling campaign on the Certej deposit comprising 29 hole s for some 3,492 metres.  The drilling programme was designed to convert inferred resources within the current pit design to the indicated category and to test the link structure.  To date results have been received for all of the 29 holes and significant intercepts are as follows:

Results are quoted using a 1.0 g/t Au lower cut-off grade, no upper grade cut being applied, and include a maximum of 5 m consecutive internal waste.  Only intercepts equal to or greater than 1.5 g/t Au are reported. The Certej deposit is irregular in nature, however drilling has been conducted perpendicular to mineralisation wherever possible and as such drilled widths correspond to true widths. Unless otherwise indicated, the intercepts reported above are from half HQ size Diamond core and the holes are sampled at one-metre intervals throughout the entire hole.

High gold grade drill intercepts from the southern flank of the West Zone represent a zone of intense potassic and variably silica altered andesite which trends southwest and is open along strike and down dip.  The drilling confirmed the inferred resources and also identified these additional higher grade mineralised zones in the western part of the deposit.  The results are currently being assessed and a new resource calculation will be completed later in 2007 followed by a revised pit optimisation and reserve estimation.

Sample preparation and analysis was carried out at the independent ISO Certified ALS-Chemex Laboratory at Gura Rosiei, Romania, using industry standard fire assay techniques for gold on 50-gram sample charges with atomic absorption spectrometry ("AAS") finish and aqua regia digest for silver with an AAS finish. In addition to the laboratory's standard quality assurance / quality control ("QAQC"), the Company submits field duplicates, crusher duplicates, pulp duplicates and known gold standards on a routine basis and these comprise approximately 20% of submitted samples.

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