During the summer of 2009, I urged my readers to follow the yellow brick road into China with shares of burgeoning gold producer Eldorado Gold (NYSE: EGO). One year later, the stock earned a nod from Fortune Magazine as the fastest-growing company in 2010.

Eldorado's transformational acquisition of Sino Gold certainly touched off a noteworthy and highly profitable growth spurt, but this week the company mapped out the route for an even more remarkable journey into long-term, peer-leading, and profit-multiplying growth. Because this new journey now leads our focus from China to Eastern Europe -- along the route of the legendary Silk Road -- I urge my readers to retrace this ancient trade route with me in order to examine the tremendous promise of Eldorado Gold.

The moment the company succeeded in completing the acquisition of European Goldfields -- with its attractive portfolio of advanced-stage development projects in Greece and Romania -- Eldorado secured its position as a venerable front-runner among midtier gold miners looking to join the ranks of the majors. After Yamana Gold (NYSE: AUY) lights up the gold world by surpassing 1.7 million ounces of low-cost gold production in 2014, Eldorado is poised to reach the mark by 2016. Accordingly, Eldorado took fifth position among my top 10 gold stocks for 2012; AuRico Gold (NYSE: AUQ) was the only midtier selection to place higher. 

After recalibrating its growth plans to account for the recently acquired assets, Eldorado is now gunning for a spellbinding production expansion of 160% over a five-year period. To reach that goal, the miner seeks to add five new mines to reach a "dirty" dozen of mining operations. The estimated $1.95 billion in capital expenditures required for the build-out would be "largely funded by growing internal cash flow."

A conservative read still leaves ample room for gains
Given recent industry precedents for even the best-laid growth plans running into some challenges -- including Agnico-Eagle Mines' (NYSE: AEM) own five-mine sprint from a few years back -- I consider it prudent for investors to adopt a more conservative set of expectations. After all, Eldorado's 2011 production came in roughly 18% beneath its own target of 800,000 ounces announced before the start of that year. That's one reason why we find the stock at such a compelling valuation today! 

I believe the market has failed notably at pricing-in any substantial portion of the looming growth, so I perceive a meaningful margin of safety built in to accommodate any unforeseeable hiccups on the recently mapped road from 0.66 million ounces in 2011 to a 1.7 million by 2016. Goldcorp (NYSE: GG) is eyeing only a 70% growth spurt over the same period, and even that bargain stock arguably carries a more substantial growth premium than Eldorado Gold.

Likewise, Eldorado would not have to preserve 100% of its intended average cost structure of $350 per ounce over the same period to render the shares a remarkable bargain here. But the massive by-product credits in copper, silver, lead, and zinc offered by the newly acquired assets of European Goldfields do lend support to such aggressively low cost expectations. Projected to commence production in 2015, the Skouries mine in Greece is seen yielding 130,000 ounces of gold per year with a jaw-dropping net cost of negative $700 per ounce! The Olympias mine (also in Greece) will enter production later this year at a small initial scale, but is likewise seen sporting a negative net cost for gold production once the operation ramps up beyond 100,000 ounces by 2016.

I'll see you out on the Silk Road
I have been a delighted holder of Eldorado Gold shares since 2006 and have maintained a bullish CAPScall on the stock since 2007. To date, that CAPS pick has racked up a cozy 184% advance, while the S&P 500 has dipped 5.5% over the same period. I look forward to continuing on this rewarding journey of growth with a gold producer that I've come to know so well, and I am truly excited by the quality of these assets recently acquired. With an innovative dividend formula that returns cash as a function of production volume and prevailing gold prices, and a newly specified growth plan in place, I encourage Fools to walk the Silk Road with me from Eldorado's prior growth spurt in China to its emerging expansion in southeastern Europe.

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