Eldorado breaks ground in Turkey (September 10, 2004)

With all required construction permits and approvals in hand, Eldorado Gold (ELD-T) plans to crank up construction at its Kisladag gold project in western Turkey later this month.

The company has already established temporary office facilities, and road construction will also soon begin. Other early work will include water well drilling and electrical power line construction.

“With the recent approvals, Eldorado remains on schedule to commence production late in 2005,” said Eldorado’s chief executive Paul Wright in a prepared statement. He adds that the exact start up date will depend on how weather conditions this winter affect construction of the operation’s leach pads.

Wright says capital expenditures have already begun, and he expects US$13 million to be spent during the last three months of 2004; another US$24 million will follow in the first quarter of 2005, followed by another US$26 million over the balance of the year. At the end of June, Eldorado had US$86.8 million in cash, with no debt.

Earlier this summer, Kisladag was granted an exemption from Turkey’s value-added tax, which would have seen the project’s costs soar.

Kisladag is expected to produce about 164,000 oz. of gold during its first year, increasing thereafter to 240,000 oz. per year at an estimated cash cost of US$165 per oz. Over its planned 14-year lifespan the mine will churn out around 3 million oz. of gold.

With Kisladag underway, Eldorado plans to advance its Efemcukuru project to a construction decision, and hopes to submit an Environmental Impact Assessment later this year.