This news hit Monday Morning. So the smart money got in ahead of it. Not to worry it looks like there is alot more good news to be released in the future.
FULL TEXT-Eldorado Gold costs to fall
(Full text of press release from ISDN Wire Service)
ELDORADO'S CASH COSTS TO FALL TO US$200 PER OUNCE IN 1999 AIDED BY BRAZILIAN CURRENCY DEVALUATION
VANCOUVER, BC, Feb 15 - Eldorado Gold Corporation (the ''Company or Eldorado'') today announced it expects to produce 185,000 ounces of gold at an average cash cost of US$215 per ounce in 1999. Hugh Morris, President & Chief Executive Officer commented, ''Devaluation of the Brazilian currency, the Real, comes at an opportune time for Eldorado. It will allow us to profit further from our investment in the Sao Bento Mine and from the enhancements we have made since 1996. We expect to see higher cash flow from the operation in 1999 together with attractive opportunities for further expansion in production and continued cost reduction. Eldorado re-established positive cash flow from operations during the second half of 1998, the result of rigorous cost cutting and downsizing. We also successfully restructured the Company's debt and our production is fully hedged for 1999 at US$320 per ounce and approximately 45% hedged for 2000 and 2001 at US$335 per ounce. These moves, in combination with the Brazilian devaluation, should lead to much improved financial performance for the Company in 1999 and beyond. This will enable us to pursue expansion at our existing mining operations and accelerate work towards exploitation of Eldorado's advanced stage development projects. '' Sao Bento Mine, Brazil At the Sao Bento Mine in Brazil, gold production in 1999 is estimated to be 125,000 ounces at a cash cost of US$200 per ounce. This represents a 19% decrease in cash costs when compared with 1998 figures. The significant decrease in cash costs has been accelerated by the recent dramatic devaluation of the Brazilian currency, the Real. The Company has conservatively estimated that cash costs will fall from fourth quarter 1998 levels of US$227 per ounce when the Real was at 1.20 per US dollar, to approximately US$200 per ounce if the Real stabilizes at 1.60 per US dollar. The Real is currently at 1.90 per US dollar and currency experts have projected a modest recovery to the 1.60 - 1.70 range, with inflation at 10% to 15% or less. Production figures for January 1999 have confirmed the Company's assumptions, with cash costs for the month below US$200 per ounce. The Company believes that the Real was significantly over-valued, and that the recent devaluation represented a correction. Going forward, the Company will continue to enjoy the benefits of the devaluation provided that, in future, the rate of depreciation of the currency and the rate of inflation are comparable. La Colorada Mine, Mexico At the La Colorada Mine in Mexico, gold production is projected to be 60,000 ounces at a cash cost of US$245 per ounce in 1999. This represents steady state production and cash costs when compared with 1998 figures. Development and Exploration In Turkey, the Company will continue to develop two key projects out of its impressive portfolio of assets. At the 100% owned, 1.2 million ounce WT/Efemcukuru gold deposit, the Company has embarked on a development plan, which envisages an underground mine and associated processing facility producing gold in the form of a saleable flotation and gravity concentrate. A preliminary feasibility report is expected to be completed by the end of February 1999. Permitting for the project was initiated in 1998. The Site Selection Permit process is well advanced and preparation of the Environment Impact Assessment is underway. Receipt of the Site Selection Permit will enable the Company to commence work on a bankable feasibility study. This study would include in-fill drilling, bulk sampling and metallurgical testing. The Company hopes to start this program during 1999. At the 100% owned Kisladag gold project, results from a phase one drill program indicate the presence of a major bulk tonnage gold discovery with drill intercepts of up to 250 meters grading 1.7 g/t Au. Work is currently underway on plans for a substantial follow-up drilling program aimed at detailing the discovery to the level of a confirmed Resource. This news release contains forward-looking statements based on the beliefs of the management of the Company as well as assumptions made by and information currently available to management of the Company. These statements reflect the current views of the Company with respect to future events based on currently available information and are subject to risks and uncertainties that could cause actual results to differ materially from those contained in these statements. The forward-looking statements contained in this news release speak only as of the date hereof. The Company does not undertake any obligation to release publicly any revisions to this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Eldorado Gold Corporation is an international gold company that currently operates one mine in Brazil and one mine in Mexico, and expects to produce approximately 185,000 ounces of gold in 1999. The Company has an extensive background in acquiring, discovering and developing quality gold assets. The Company's goal is to create a portfolio of low cost mining assets with a strong financial base. ON BEHALF OF ELDORADO GOLD CORPORATION ''Hugh C. Morris'' Hugh C. Morris Chairman, President and Chief Executive Officer Eldorado Gold Corporation's shares (Symbol: ELD) trade on the Toronto Stock Exchange (''TSE'') and the Vancouver Stock Exchange (''VSE''). Neither the TSE, nor the VSE have approved or disapproved the form or content of this release. Investor Relations Contacts: Tel: (604) 687-4018 and 1-888-ELD-8166 Fax: (604) 687-4026 www.eldoradogold.com Suite 920 - 1055 West Hastings Street, Vancouver, British Columbia, Canada V6E 2E9 Eldorado Gold Corporation ELD 99-04
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