Gammon Gold Announces Strike Action at El Cubo Mine

    HALIFAX, April 29 /CNW/ - Gammon Gold Inc. ("Gammon") (TSX:GAM and
NYSE:  GRS): Gammon Gold announced that the collective agreement at the El Cubo
Mine expired on April 23, 2009. As Management has increased its attention to
the El Cubo mine, it has tabled an offer for a new collective agreement with
the local union that would see the adoption of a continuous work schedule as
is the normal practice in mining operations throughout Mexico, including the
same work schedule at the Herradura Mine in Sonora State, Mexico, represented
by the same national union. It is anticipated by the Company that this new
work schedule would further improve El Cubo's productivity and therefore
operating margins. As El Cubo only represents 21% of the Company's 2009
forecasted production with costs substantially higher than those at the
flagship Ocampo mine, the Company has suspended discussions and has allowed
its union workers to take strike action as per the union's collective
agreement, effective April 29, 2009.
    "We have made the union a fair and reasonable offer and the wages and
benefits offered to the union are comparable to wages paid to workers
represented by the same union as the El Cubo workforce. The two parties had
agreed in principle to an 8% increase in basic wages and a 3% increase in
benefits. The parties could not agree on a continuous work schedule. The
affected union members were, in addition, offered a onetime, 6% signing bonus
and a 20% punctuality and attendance bonus as part of the new schedule" stated
Rene Marion, Chief Executive Officer of Gammon Gold. He continued, "We would
like to thank all levels of the Mexican Government for their continued support
while the Company proceeds with the continued negotiations. We remain
steadfast in our resolve to negotiate an agreement that is in the best
interests of our shareholders, our employees and the communities they live

    Ocampo Update

    The Phase II Ocampo mill expansion was fully commissioned in early March,
2009. The ramp up has been very successful with the mill achieving over 3,100
tonnes per day over the past 10 days.
    The Phase III expansion of the Ocampo mill remains on target for
commissioning early in the third quarter of this year. Engineering for the
expansion has been completed and the gravity circuit equipment associated with
the mill expansion has arrived on site and is currently being commissioned.
Once complete, the Phase III expansion will almost triple mill throughput
capacity over the average daily tonnages achieved in 2007.

    About Gammon Gold

    Gammon Gold Inc. is a Nova Scotia based mid-tier gold and silver producer
with properties in Mexico. The Company's flagship Ocampo Project in Chihuahua
State achieved commercial production in January 2007. Gammon Gold also
operates its El Cubo operation in Guanajuato State and has the promising
development Guadalupe y Calvo property in Chihuahua State. The Company remains
100% unhedged.

                             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 (File No. 001-31739), 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 2009 results, any decrease in cash costs for Q4 2008
and full year 2008 resulting from a reversal of the mark-to-market valuation
adjustment made in Q3 2008, our ability to fully fund our business model
internally, 2009 gold and silver production and the cash and operating costs
associated thereafter, the ability to achieve productivity and operational
efficiencies, the ability to complete the Phase II mill expansion, the
connection to the grid power, 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

For further information:

For further information: Please visit the Gammon Gold website at or contact: Rene Marion, Chief Executive Officer, Gammon
Gold Inc., (902) 468-0614; Anne Day, Director of Investor Relations, Gammon
Gold Inc., (902) 468-0614

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