About EURO Ressources S.A.

EURO Ressources S A (Euronext: EUR) is a French company focused on precious-metal royalties.

The Company’s principal asset is a 10% royalty interest on production from the Rosebel gold mine in Suriname. Rosebel is operated by IAMGOLD and as of December 31, 2010 had an estimated attributable Mineral Reserve of 172 million tonnes containing 5.9 million ounce of gold at 1.1 g/t Au. The Gross Rosebel Royalty due by IAMGOLD applies to the first 7 million ounces of gold produced from the mine and the payments comprising the Rosebel Royalty which IAMGOLD is required to pay are calculated on the basis of gold production at the Rosebel mine and the market price of gold based on the London pm fixing price.  This amount is calculated based on 10% of the excess gold market price above US$300 per ounce for soft and transitional ore and above US$350 per ounce for hard rock ore, and, in each case, after deducting a fixed royalty of 2% of production paid in-kind to the Government of Suriname.

Rosebel commenced production in 2004 and as of the end of 2010 had produced 2.4 million ounces of gold.  Rosebel is forecasted to produce between 360,000 and 380,000 ounces of gold in 2011.

From the time the Company was established in 1993 until 2004, its business activities focused on exploration and, if warranted, development of precious metal deposits in French Guiana.  In accordance with this business model the Company acquired the mineral rights to several exploration stage properties in French Guiana and conducted exploration related activities on these properties.  These exploration activities were funded through a combination of equity capital funds, joint venture partnership funds and loans from Golden Star, which was, until June 2006, the Company’s majority shareholder.

Since 2000 there has been no material exploration work performed by the Company on the Company’s properties.  The Company undertook a major restructuring in 2004 and following this restructuring, in December 2004, the Company acquired a participation right (the “Rosebel Royalty”) on the Gross Rosebel gold mine in Suriname (the “Rosebel Gold Mine”), which is owned and operated by IAMGOLD Corporation (“IAMGOLD”).

In November 2007, the Company completed a rights issue with its shareholders, raising additional equity of €7.34 million in cash (being approximately $11 million) in consideration for the issue of 10,098,576 additional common shares.

On August 29, 2008, IAMGOLD filed with the Autorité des marchés financiers (the French financial services regulator) (the “AMF”) an unsolicited takeover bid to acquire up to 100% of the outstanding common shares of the Company for €1.20 per share.  IAMGOLD’s offer closed on December 17, 2008 and the AMF announced in late December 2008 that IAMGOLD controlled 84.6% of the common shares of the Company on a fully-diluted basis.  As of December 31, 2010, IAMGOLD held approximately 86% of the Company’s issued and outstanding common shares.

On November 18, 2009, the Company entered into a settlement agreement with Golden Star (the “Settlement Agreement”) to bring an end to the litigation between the two parties commended in September, 2008 regarding the Paul Isnard properties which were at that time held by EURO and SOTRAPMAG.

At the time of the making of the Settlement Agreement, the Paul Isnard properties were comprised of eight mineral concessions held by SOTRAPMAG and an exploration permit held by the Company (the “PER”).  Prior to the expiry of the PER the Company applied for an operating permit (the “PEX”) to replace the PER.  The eight mineral concessions and the application for the PEX are referred to collectively as the “Paul Isnard Properties”.

Pursuant to the terms of the Settlement Agreement, EURO agreed to transfer ownership of SOTRAPMAG and the Company’s interest in the PER (now succeeded by the PEX application) to Golden Star in return for a royalty on gold production from the Paul Isnard Properties. The royalty, as historically agreed between the parties, is equal to the difference between the market price of gold and US$400.00 multiplied by 10% of gold production up to two million ounces and by 5% of gold production between two and five million ounces. 

Golden Star notified EURO in December 2009 that ownership of SOTRAPMAG and of EURO’s interest in the PER was to be transferred to a third party, Auplata S.A. (“Auplata”).  Based on the transaction between Golden Star and Auplata for the selling of Paul Isnard Properties and two other exploration properties in French Guyana, the value of Paul Isnard Properties has been estimated by EURO to be $1,500,000 ($750,000 for the PER and $750,000 for the mineral concessions).

The transfer of the Company’s interest in SOTRAPMAG to Auplata was completed on October 22, 2010.  Upon the grant by the French authorities of the PEX to the Company, which is anticipated at the end of 2011 or in early 2012, the Company will transfer the PEX to SOTRAPMAG.