June 15, 2011 / 7:22 AM / 7 years ago

UPDATE 1-European Goldfields says Greek permit decision in 3 weeks

* Co seeking permit for two goldmines in northern Greece

* Q1 pretax loss $4.9 mln vs loss $5.7 mln yr ago

* Sales up 30 pct to $13.5 mln

June 15 (Reuters) - London-based European Goldfields EGUq.L said Greece would decide within three weeks on awarding the miner a permit to run two goldmines, a key project in the northern part of the country that has been delayed by a year.

Last year, European Goldfields, which operates a lead and zinc mine in the Halkidiki region, submitted an environmental impact study (EIS) seeking permission to mine for gold and other metals.

But Greece delayed approval of the study, partly due to local opposition and to make sure the project would not pollute groundwater deposits in the area.

Last month, the company told Reuters that it expected to secure the permit in June.

Many local residents opposed the new mines, worried they would harm the environment and living conditions in the area. The small Ecogreens party has also called on the government to reject the environmental study.

The company also posted a narrower pretax loss of $4.9 million for the first quarter ended March 31. Sales rose nearly 30 percent to $13.5 million, driven mainly by higher prices of metals like lead, silver and zinc.

European Goldfields shares, which have fallen over 14 percent in the last two trading sessions after the company dropped out of the GDXJ junior gold Exchange Traded Fund, were trading up 1.4 percent at 659 pence at 0716 GMT on Wednesday on the London Stock Exchange. (Reporting by Anirban Sen in Bangalore; Editing by Roshni Menon)

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