Gammon Gold Raises 2009 Guidance as Gold Production Up 27 Percent

Annual gold production at Gammon Gold (GRS) increased by 27 percent, spurring the company to say things are now turned around.

For 2008, the company mined 154,428 ounces of gold, while also bringing out another 5,778,428 ounces of silver.

The gold-to-silver ratio of 59:1 helped the company improve its cash costs, as the $539 gold equivalent ounce was 20 percent better than 2007.

According to the company, improved productivity throughout the company, as well as an increase in processing capacity at the Ocampo mine were the keys to their performance.

Giving their guidance, Gammon Gold said they are looking to produce between 185,000 to 205,000 ounces of gold, while silver should come in between 8,170,000 to 8,945,000ounces,

Assuming a 78:1 gold-to-silver ratio, costs should be between $410 to $445.