Gammon Reports Strong Operating Performance at the Ocampo Mine for October and November

By Gammon Gold Inc., PRNE
Monday, December 6, 2010


TORONTO, December 7, 2010 - Gammon Gold Inc. ("Gammon") (TSX:GAM and NYSE:GRS): is pleased to provide
preliminary results from the Ocampo mine for the months of October and
November. Operations at the Ocampo mine continue to strengthen and benefit
from the completion of the two year capital expansion program. All figures
reported are in U.S. dollars unless otherwise indicated.

The Company remains on track to achieve the 2010 Ocampo production and
cash cost guidance of 100,000-110,000 gold ounces; 4,400,000-4,950,000 silver
ounces; 180,000-200,000 gold equivalent ounces(1); and total cash costs of
US$410 - US$435 per gold equivalent(1) ounce.

    Ocampo Key Performance Indicators - October and November, 2010
    The Ocampo mine continued to report positive results during the quarter
    to date period including:

    - Production of 18,438 ounces of gold and 752,215 ounces of silver, or
      32,548 gold equivalent ounces at the realized gold equivalency ratio of
      53:1 (or 32,115 using the Company's long term gold equivalency ratio of
    - Total cash costs per gold equivalent ounce averaged $437 using the
      realized gold equivalency ratio of 53:1 (or US$445 using the Company's
      long term gold equivalency ratio of 55:1)
    - Utilizing Ocampo's silver revenues as a by-product cost credit, total
      cash costs per gold ounce were negative US$309 per gold ounce sold
    - The primary North-East underground mine averaged 1,612 tonnes per day,
      exceeding design rates
    - The second underground operation, Santa Eduviges, is confirmed to
      commence commercial production during December 2010
    - Open pit production averaged more than 103,956 tonnes per day,
      exceeding the targeted design rates
    - The mill facility reported 3,121 tonnes per day
    - Mill recoveries improved to 97% for gold and 81% for silver as a result
      of the commissioning of the mill cyclones, thickeners and leach tank
    - Stacking at the heap leach facility averaged over 10,394 tonnes per day

"I am very pleased that the Ocampo team continues to deliver improvements
across the key operating metrics. The operations are now benefiting from the
two year capital expansion program that is not only supporting continued
production growth, but at costs lower than the industry average, all of which
is during a period of record metal prices." said René Marion, President and
Chief Executive Officer. "Margins of US$933 per gold equivalent ounce, or
68%, combined with our very strong cash position of over US$107 million as of
September 30th, positions Gammon well to self fund its future growth

    Recent Operational Highlights

    - Development of the Santa Eduviges underground mine continues to benefit
      from having access to the additional workforce redeployed from the
      Company's El Cubo mine. More than 1,700 metres of development has been
      completed at Santa Eduviges to date with stoping anticipated to begin
      in late December
    - The ongoing exploration program at Santa Eduviges has reported
      continued positive results. To date, the program has added new ounces
      to Reserves and increased the number of delineated veins from one to
    - Accelerated development of new reserve and resource discoveries in the
      northeast underground mine also continued, with considerable progress
      being made at the Belen, Santa Juliana and San Amado veins
    - The redundancy program at the Ocampo mill facility is largely complete
      with the commissioning of the fourth filter press scheduled at the end
      of December
    - The Preliminary Economic Assessment of the Guadalupe y Calvo
      development property is expected to be released in approximately
      4-6 weeks
    - The Company is currently updating its annual Reserves and Resources and
      expects to release the results in February, 2011

    Ocampo Key Performance Metrics
    Underground                   Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Average tpd                     1,377      1,500      1,596        1,612
    Head grade Aue (g/t)(1)          5.23       4.73       4.45         4.85
    Avg. monthly development        1,301      1,581      2,182        2,357
    Open Pits                     Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Average tpd                    93,730    103,117     97,992      103,956
    Head grade Aue(g/t)(1)           0.97       1.01       1.46         1.09
    Mill Facility                 Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Average tpd                     2,920      3,182      3,113        3,121
    Mill grade Aue(g/t)(1)           3.53       3.50       3.87         3.87
    Heap Leach Facility           Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Average tpd                     7,328     10,017      6,830       10,394
    Head grade Aue (g/t)(1)          0.72       0.81       0.94         0.85
    Production                    Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Gold Ounces Produced           21,855     24,963     27,018       18,438
    Silver Ounces Produced        960,817  1,066,998  1,189,769      752,215
    Gold eq.(1) Ounces
     Produced                      39,325     44,363     48,650       32,115
    Total Cash Costs              Q1 2010    Q2 2010    Q3 2010  Oct/NovTD(2)
    Total cash costs per
     gold eq. ounce (Realized)       $458       $461       $440         $437
    Total cash costs per gold
     eq. ounce (55:1)                $423       $430       $411         $445
    Total cash costs per
     gold ounce                        $8       ($33)     ($121)       ($309)

About Gammon Gold

Gammon Gold Inc. is a mid-tier gold and silver producer with properties
in Mexico. Gammon's flagship Ocampo Property in Chihuahua State achieved
commercial production in January 2007. Gammon also owns the suspended El Cubo
mine in Guanajuato State and has the promising Guadalupe y Calvo development
property in Chihuahua State. Gammon recently completed option purchase
agreements to acquire the Mezquite Project in Zacatecas State, Mexico and the
Venus project located north of the Ocampo mine. Gammon also recently signed a
definitive agreement to acquire the Los Jarros Project in Chihuahua State.
Since 2008, the Company has increased its Mexican land position by over 59%
and has made strategic investments in Golden Queen Mining Co. Ltd. and Corex
Gold Corporation. The Company's Executive Office is located in Toronto,

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/A, 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, statements regarding 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 the development of new deposits, costs and
timing of construction, costs and timing of future exploration and
reclamation expenses including, anticipated 2010 and 2011 results, operating
performance projections for 2010 and 2011, our ability to fully fund our
future growth internally, our ability to expedite the development of the
Santa Eduviges underground, the continued positive results from our
exploration programs, our ability to complete the Preliminary Economic
Assessment of Guadalupe y Calvo in 4-6 weeks, 2010 and 2011 gold and silver
production and the cash and operating costs associated therewith, the ability
to achieve productivity and operational efficiencies, further improvements to
silver recoveries resulting from improvements to the Ocampo mill 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.

(1) Using the Company's long term gold equivalency ratio of 55:1

(2) Data from October to November are estimates only and are subject to
final adjustments

For further information: For further information: please visit the Gammon
Gold website at or contact: René Marion, Chief
Executive Officer, Gammon Gold Inc., +1-416-646-3825; Anne Day, Director of
Investor Relations, Gammon Gold Inc., +1-902-468-0614

For further information: For further information: please visit the Gammon Gold website at or contact: René Marion, Chief Executive Officer, Gammon Gold Inc., +1-416-646-3825; Anne Day, Director of Investor Relations, Gammon Gold Inc., +1-902-468-0614

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