Eldorado Gold and the Greek government have signed a revised investment agreement covering Eldorado's assets in northern Greece, paying the way for the potential development of the Skouries project and expansion of the Olympias mine and the Stratoni/Mavres Petres mines and facilities in the country, collectively known as the "Kassandra Mines".
In 2017, Eldorado Gold halted all operations in the country due to government delays in issuing permits for Skouries and Olympias, two of the company's key assets.
The deal will allow the company to finish construction at Skouries and transition the project into production. It would also help it expand production at Olympias gold-silver-lead-zinc mine to 650'000 tonnes a year. The revised plan covers upgrades to the port facilities at Stratoni to allow for bulk shipment of concentrates and boost of exploration work Mavres/Petres deposit, part of the company's Stratoni project.
Eldorado Gold is continuing to evaluate financing options for Skouries, which the company has previously indicated would likely include a partnership.
Once restarted, Eldorado expects to complete construction in approximately 2.5 years. Skouries is a gold-copper porphyry deposit estimated to produce 140,000 ounces of gold and 67 Mio. pounds of copper per year with an initial mine life of 23 years. Plant construction is 50% complete.
Early January 2021, the company released Q4/20 production of 138'220 ounces of gold from its mines Kisladaq and Efemcukuru (Turkey), Olympias (Greece) and Lamaque (Canada). For full 2020, Eldorado produced 528'874 ounces of gold.
The new agreement with Greece is very positive for Eldorado Gold. The shares have been undervalued for a long time waiting for developments with the Greek government.
The shares of Eldorado Gold closed on Friday at US$ 12.96 (+ $ 1.46 or 12.7%). The stock could rally substantially higher once the new agreement is ratified by the Greek parliament.
The long-term Point & Figure chart shows a great base at US$ 11 and a potential of US$ 19, the highs of 2017. The market capitalization is US$ 2.2 BN.
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