Gammon Gold Provides Update on Labour Negotiations at the El Cubo Mine

By Gammon Gold Inc., PRNE
Monday, February 21, 2011

TORONTO, February 22, 2011 - Gammon Gold Inc. ("Gammon" or the "Company") (TSX: GAM) (NYSE:GRS) wishes
to provide an update on recent developments at the Company's El Cubo mine
located in Guanajuato State, Mexico. In response to reports issued by the
Mexican media that have indicated an end to the 8-month labour disruption,
the Company wishes to clarify the status of current negotiations with the El
union. The Company confirms that advanced negotiations with the union
are currently underway and while the Company is optimistic that a resolution
to the work stoppage will be finalized in the near term, a definitive
agreement with the union has not been reached. As this time, the union
continues to restrict access to the mine facilities. However, as a sign of
good faith, representatives from both the Company and the union will be
inspecting the underground mine facilities today to determine the possible
level of remediation requirements before mining activities could resume.
The Company will provide further updates as warranted.

About Gammon Gold

Gammon Gold Inc. is a mid-tier gold and silver producer with properties
in Mexico. Gammon's flagship Ocampo Property is located in Chihuahua State.
Gammon also owns the El Cubo mine in Guanajuato State and the Guadalupe y
Calvo development property in Chihuahua State. In 2010 Gammon completed
option purchase agreements to acquire the Los Jarros and Venus Projects
located directly north and east of the Ocampo mine, the Mezquite Project in
Zacatecas State, and has signed a binding Letter of Intent to joint venture
into the La Bandera gold project in Durango State. The Company has made
strategic investments in Golden Queen Mining Co. Ltd. and Corex Gold
Corporation. The Company's Executive Office is located in Toronto, Ontario.

For further information please visit the Gammon gold website at or contact:

                              Cautionary Statement

Cautionary Note to US Investors - The United States Securities and
Exchange Commission permits US mining companies, in their filings with the
SEC, to disclose only those mineral deposits that a company can economically
and legally extract or produce. This press release uses certain terms, such
as "measured," "indicated," and "inferred" "resources," that the SEC
guidelines strictly prohibit US registered companies from including in their
filings with the SEC. US Investors are urged to consider closely the
disclosure in Gammon gold's Annual Report on Form 40-F, which may be secured
from Gammon gold, or from the SEC's website at

No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein.

Certain statements included herein, including information as to the
future financial or operating performance of the Company, its subsidiaries
and its projects, constitute forward-looking statements. The words
''believe'', ''expect'', ''anticipate'', ''contemplate'', ''target'',
''plan'', ''intends'', ''continue'', ''budget'', ''estimate'', "forecast",
''may'', ''will'', ''schedule'' and similar expressions identify
forward-looking statements. Forward-looking statements include, among other
things, future exploration results of its development program, the Company's
ability to delineate additional resources and reserves as a result of such
program, and the company's ability to mine such targets by mid-2011,
statements regarding its financial exposure to litigation, targets, estimates
and assumptions in respect of gold and silver production and prices,
operating costs, results and capital expenditures, mineral reserves and
mineral resources and anticipated grades, recovery rates, future financial or
operating performance, margins, operating and exploration expenditures, costs
and timing of completion of the Ocampo expansion program and improvements to
the heap leach pad, costs and timing of the development and commencement of
production of new deposits, costs and timing of construction, costs and
timing of future exploration and reclamation expenses including, anticipated
2010 results, operating performance projections for 2010 and 2011, our
ability to fully fund our business model internally, 2010 gold and silver
production and the cash and operating costs associated therewith, the ability
to achieve productivity and operational efficiencies, the ability to access
grid power at Ocampo, further reduction in the open pit stripping ratio and
the timing of each thereof. Forward-looking statements are necessarily based
upon a number of estimates and assumptions that, while considered reasonable
by the Company, are inherently subject to significant business, economic,
competitive, political and social uncertainties and contingencies. Many
factors could cause the Company's actual results to differ materially from
those expressed or implied in any forward-looking statements made by, or on
behalf of, the Company. Such factors include, among others, known and unknown
uncertainties and risks relating to additional funding requirements, reserve
and resource estimates, commodity prices, hedging activities, exploration,
development and operating risks, illegal miners, political and foreign risk,
uninsurable risks, competition, limited mining operations, production risks,
environmental regulation and liability, government regulation, currency
fluctuations, recent losses and write-downs, restrictions in the Company's
loan facility, dependence on key employees, possible variations of ore grade
or recovery rates, failure of plant, equipment or process to operate as
anticipated, accidents and labour disputes. Investors are cautioned that
forward-looking statements are not guarantees of future performance and,
accordingly, investors are cautioned not to put undue reliance on
forward-looking statements due to the inherent uncertainty therein.

For further information:

    Rene Marion
    President and CEO
    Gammon Gold Inc.

    Anne Day
    Director of Investor Relations
    Gammon Gold Inc.

Rene Marion, President and CEO, Gammon Gold Inc., +1-416-646-3825 ; Anne Day, Director of Investor Relations, Gammon Gold Inc., +1-416-646-3825

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