European Goldfields Limited - RESULTS FOR Q1 2011

WHITEHORSE, June 15, 2011 /CNW/ --
WHITEHORSE, June 15, 2011 /CNW/ - European Goldfields Limited (TSX / AIM: EGU) ('European Goldfields' or the 'Company') today reports its results for the quarter ended 31 March 2011.  The
financial statements, as well as the accompanying management's
discussion and analysis, are available for review at http://www.egoldfields.com/egoldfields/en/financials/quarterlies and should be read in conjunction with this news release.

Operational and development highlights

Greece

    --  Minister Birbili confirms final Joint Ministerial Decision to
        be delivered within 3 weeks
    --  Ministry confirms full technical and environmental review
        complete 
    --  New equipment orders for the Olympias Mill ready for placement
    --  Invitation to bid package finalised for the Skouries EPC
        contract

Romania

    --  Local public consultation process complete and CONSIB approval
    --  Engineering for Technical Project complete
    --  Construction of second weir commenced

Corporate activity

    --  SRK audit of the Certej project advancing
    --  Working towards ICMM accreditation

Financial

    --  Sales of US$13.5 million
    --  Working capital of US$70 million
    --  IFRS reporting adopted

Martyn Konig, Executive Chairman and President, commented:

'We had hoped by this point to have been able to announce the approval
of our EIS, and with it the inward investment and job creation that is
clearly much needed by the Greek economy. We are of course disappointed
that this is not yet the case, however we are pleased that Minister
Birbili has informed us that a final Joint Ministerial Decision will be
made within 3 weeks. In anticipation of approval, we have been
diligently preparing, both at a corporate and operational level, so
that we are well placed for the efficient and expeditious build-out of
the projects as soon as it is granted.'

                      SELECTED FINANCIAL DATA

                               Quarter ended 31 March

(in thousands of US dollars,           2011      2010
except per share amounts)                 $         $

Statement of profit and loss                         

Sales                                13,531    10,435

Gross profit                          2,793       896

Profit/(loss) before income tax     (4,933)   (5,686)

Income taxes                          2,354   (1,048)

Profit/(loss) after income tax      (2,579)   (6,734)

Non-controlling interest                  9      (77)

Profit/(loss) for the period        (2,570)   (6,811)

Earnings/(loss) per share            (0.01)    (0.03)

                                            

(in thousands of US dollars) 31 March 2011 31 December 2010
                                         $                $

Balance sheet                                              

Working capital                     70,483           79,555

Total assets                       512,739          507,293

OPERATIONAL AND DEVELOPMENT HIGHLIGHTS

GREECE

Permitting - Minister for Environment, Energy and Climate Change, Ms Birbili, has
informed the Company that the Joint Ministerial Decision will be made
within the next 3 weeks. This follows a comprehensive review and
evaluation by the Ministry of Environment, which has confirmed it is
now complete.

Olympias - The Company plans to place orders for the new equipment required for
the reprocessing of tailings at the Olympias Mill immediately after
receiving the EIS approval. Once approval has been received, first gold
production is scheduled for Q1 2012 from the reprocessing of tailings
at 63,000 oz per annum, with primary underground gold production
expected to commence Q4 2015 at an initial rate of 125,000 gold
equivalent ounces per annum.

Skouries - The invitation to bid package for the Engineering, Procurement and
Construction ('EPC') contract for the Skouries Project has been
completed and is ready for submission to prospective contractors
directly upon receipt of EIS approval.  Once the EIS has been received,
open pit production at Skouries is expected to commence in Q1 2014 at
an annualised average rate of 350,000 gold equivalent ounces.

The Company's 95%-owned subsidiary, Hellas Gold, mined a total of 50,282
wet tonnes in Q1 2011 (Q1 2010 - 63,294). Sales from Stratoni were as
follows:

                                                     Q1 2011   Q1 2010

Production                                                            

Ore mined (wet tonnes)                                50,282    63,294

Sales                                                                 

Zinc concentrate (tonnes)                              8,337     8,830

- Containing payable Zinc (tonnes)*                    3,392     3,633

Lead concentrate (tonnes)                              3,653     3,759

- Containing payable:               Lead (tonnes)*     2,512     2,385

                                      Silver (oz)*   188,304   178,184

Inventory (end of period)                                             

Ore mined (wet tonnes)                                 3,826    14,089

Zinc concentrate (tonnes)                              2,232     2,839

Lead/silver concentrate (tonnes)                       1,387     1,105

* Net of smelter payable deductions

Production at Stratoni - Production from the underground mine was under budget for the quarter
due to poor geotechnical conditions. This is due to the convergence of
the main Stratoni and footwall faults bounding the orebody, which have
affected mining in the upper levels of the mine. The mine has therefore
suffered from fewer faces being available than anticipated and a
greater dependence on lower grade areas than originally scheduled.
Plans have been redrawn and a revision is in progress to recoup metal
production in the second quarter.

ROMANIA

Local public consultation process complete and CONSIB approval - The local public consultation process for the Certej Project in Romania
held in April has now concluded. Consultations were conducted by
authorities from the regional environmental department and were held in
two villages. The local public consultation followed confirmation from
the Romanian authorities that the EIS complies with all Romanian
legislation, both from a technical and legal perspective. Most notably,
this included the approval from CONSIB (the National Committee for
Large Embankments), a specialist committee constituted under the
Ministry of Environment, for the design of the tailings management
facilities for the Certej Project. The cross border consultation
process is well advanced and any public meetings will be established by
the Romanian and neighbouring country authorities. Once the
consultation process has been completed the environmental authorities
will re-convene the Technical Analysis Committee to confirm the
decision regarding the issuance of the environmental permit.

Engineering for Technical Project complete - The engineering for the Technical Project which has been prepared by
Cepromin, and is a key component of the requirements under Romanian
legislation for the award of the construction permit, is complete. The
necessary approval process by the relevant authorities has commenced
with the submission of designs for the process plant facilities for
fire prevention and fire fighting systems.

Construction of second weir commenced - The construction of the second of two large reinforced concrete
rectangular notch weirs has commenced (first weir completed Q4 2010)
along the stream valley, below the site of the planned tailings
facilities. These will allow accurate flow measurements to be taken as
part of the planned environmental monitoring programme.

EXPLORATION

Greece - Surface work continues at the Piavitsa site with infill soil
geochemistry and detailed mapping being carried out prior to drilling
to enhance target definition. Other targets identified by a compilation
of all existing data and local knowledge are also being prioritised.

Romania - Having identified several promising targets using surface geochemistry
and geophysics, the Company is now seeking to upgrade its prospecting
licences to exploration licences to the west of Certej. The Company
received an operating licence for the Baita Craciunesti licence
adjacent to its Certej mining licence and exploration is underway that
aims to define satellite reserves for the main Certej deposit by the
end of this year.

Turkey - Drilling continues at the Company's Salinbas target, focused on
investigating a potential South West extension to known
mineralisation.  In addition, a geochemical survey of the area has
produced encouraging results, providing additional targets for the 2011
drilling programme and a regional exploration programme over the
Pontide Belt is ongoing.

CORPORATE ACTIVITY

SRK are continuing to complete the necessary Technical, Environmental
and Social Audit of the Certej project in order to under-pin and
finalise the structure of the Company's financing package.

Led by the Executive Chairman and President, supported by Company
specialists, the Company continues to work towards International
Council on Metals and Mining ('ICMM') accreditation. This organisation
promotes best practice throughout the industry, to which we lend our
full support. We are currently working with a third party
sustainability consultancy to aid us in the process and have completed
a materiality and gap analysis exercise, the output of which is now
under internal review.

About European Goldfields

European Goldfields is a developer-producer with globally significant
gold reserves located within the European Union. The Company generates
cash flow from its 95% owned Stratoni operation, a high grade
lead/zinc/silver mine in North-Eastern Greece. European Goldfields will
evolve into a mid-tier producer through responsible development of its
project pipeline of gold and base metal deposits at Skouries and
Olympias in Greece and Certej in Romania. The Company plans future
growth through development of its highly prospective exploration
portfolio in Greece, Romania and Turkey.

Patrick Forward supervised and prepared the scientific and technical
information included in this press release. Mr. Forward is a 'qualified
person' for purposes of National Instrument 43-101. Mr. Forward is the
Company's Vice President of Projects and Exploration.

Forward-looking statements

Certain statements and information contained in this document, including
any information as to the Company's future financial or operating
performance and other statements that express management's expectations
or estimates of future performance, constitute forward-looking
information under provisions of Canadian provincial securities laws.
When used in this document, the words 'anticipate', 'expect', 'will',
'intend', 'estimate', 'forecast', 'planned' and similar expressions are
intended to identify forward-looking statements or information.
Forward-looking statements include, but are not limited to, the
estimation of mineral reserves and resources, the conversion of mineral
resources to mineral reserves, the timing and amount of estimated
future production, costs and timing of development of the Skouries,
Olympias and Certej projects, permitting time lines and expectations
regarding metal recovery rates. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable by management, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies.

The Company cautions the reader that such forward-looking statements
involve known and unknown risks, uncertainties and other factors that
may cause the actual financial results, performance or achievements of
the Company to be materially different from its estimated future
results, performance or achievements expressed or implied by those
forward-looking statements and the forward-looking statements are not
guarantees of future performance. These risks, uncertainties and other
factors include, but are not limited to: changes in the price of gold,
base metals or certain other commodities (such as fuel and electricity)
and currencies; uncertainty of mineral reserves, resources, grades and
recovery estimates; uncertainty of future production, capital
expenditures and other costs; currency fluctuations; financing and
additional capital requirements; the receipt in a timely fashion of any
further permitting for the Company's projects; legislative, political,
social or economic developments in the jurisdictions in which the
Company carries on business; operating or technical difficulties in
connection with mining or development activities; the speculative
nature of gold and base metals exploration and development, including
the risks of diminishing quantities or grades of reserves; the risks
normally involved in the exploration, development and mining business;
and risks associated with internal control over financial reporting.
For a more detailed discussion of such risks and material factors or
assumptions underlying these forward-looking statements, see the
Company's Annual Information Form for the year ended 31 December 2010,
filed on SEDAR at www.sedar.com. The Company does not intend, and does not assume any obligation, to
update or revise any forward-looking statements whether as a result of
new information, future events or otherwise, except as required by law.

For further information please see the Company's website at www.egoldfields.com

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