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Proc-Type: 2001,MIC-CLEAR
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Report of
Foreign Issuer For the
month of May 2008 Commission
File Number 001-31739 Indicate
by check mark whether the registrant files or will file annual reports under
cover Form 20-F or Form 40-F
Form
20-F
£
Form
40-F
Q Indicate by check mark if
the registrant is submitting the Form 6-K in paper as permitted by Regulation
S-T Rule 101(b)(1): £
Note: Regulation
S-T Rule 101(b)(1) only permits the submission in paper of a Form
6-K if submitted solely to provide an attached annual report to
security holders.
Indicate by check mark if
the registrant is submitting the Form 6-K in paper as permitted by Regulation
S-T Rule 101(b)(7): £
Note:
Regulation S-T Rule 101(b)(7) only permits the submission in paper
of a Form 6-K if submitted to furnish a report or other document
that the registrant foreign private issuer must furnish and make
public under the laws of the jurisdiction in which the registrant
is incorporated, domiciled or legally organized (the registrant's
''home country''), or under the rules of the home country exchange
on which the registrant's securities are traded, as long as the
report or other document is not a press release, is not required
to be and has not been distributed to the registrant's security
holders, and, if discussing a material event, has already been the
subject of a Form 6-K submission or other Commission filing on
EDGAR. Indicate
by check mark whether by furnishing the information contained in this Form, the
registrant is also thereby furnishing the information to the Commission pursuant
to rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes
No
If ''Yes'' is marked,
indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b) 82 -
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
EXHIBIT
INDEX Description Halifax, May 16, 2008 Gammon Gold Announces a Significantly Expanded Two
Year, $26 to $29 Million, 135,000 to 150,000 metre, Exploration Program
Supported by Gammons Strengthened Financial Position Gammon Gold Inc. (Gammon) (TSX:GAM and AMEX:GRS):
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549FORM
6-K
Pursuant to Rule
13a-16 or 15d-16 of
the Securities Exchange Act of 1934
GAMMON GOLD
INC.
(Translation
of registrant's name into English)
1601 Lower
Water Street
Suite 402, Summit Place, PO Box 2067
Halifax, Nova Scotia B3J 2Z1
(Address of
principal executive offices)
£
Q
SIGNATURE
GAMMON GOLD
INC.
Date: May
16, 2008
By:
/s/ Fred George
Fred George
President
Exhibit
99.1
99.2
TSX: GAM / AMEX: GRS / BSX: GL71601 Lower Water Street
Suite 402, Summit Place
(PO Box 2067)
Halifax, Nova Scotia
B3J 2Z1, CANADA
Tel: +1 (902) 468-0614
Fax: +1 (902) 468-0631
www.gammongold.com
PRESS RELEASE
The significant upturn in operational performance at Ocampo and El Cubo is continuing to drive significant improvements in the Companys cash flow profile, which combined with the current financial position is expected to be more than sufficient to fully fund this expanded Exploration Program.
In addition to the reserve & resource expansion objectives at Ocampo and El Cubo, a large portion of the increased funding will be allocated to an accelerated two year diamond drilling program at Guadalupe y Calvo of up to 50,000 metres that will support the completion of an Advanced Scoping Study by mid-2009, which subject to underlying results, has been engineered to facilitate the full transition into a Feasibility program to accelerate the development of this exciting prospective property.
Over the past two years the Company has primarily focused its attention and financial resources on the construction and commissioning of the Ocampo mine and subsequently there has been minimal exploration activity conducted during this period. However, the ongoing performance improvements at both Ocampo and El Cubo have advanced to such a degree that management can now leverage the improving cash flow profile to fully fund this expanded exploration program.
The increased $26 to $29 million 20082009 exploration program demonstrates the confidence we have in both our cash flow profile and in the potential of our assets. With the Companys improved financial foundation, we are now in a better position than ever before to focus on an important value lever of the business that has been largely inactive for the past two years. stated Rene Marion, Chief Executive Officer of Gammon Gold. He continued, The augmented exploration program will enhance our ability to target reserve and resource expansions at our producing mines, Ocampo and El Cubo, that will further increase the potential for improved production profiles in the future. In addition, the increased funding will also allow us to further accelerate the development of our exciting advanced exploration project, Guadalupe y Calvo. The continued development of our highly prospective assets and land package is integral to our organic growth vision and we are now in a stronger position than ever to execute on the longer term supporting strategy.
Ocampo Exploration Program
The goal of the exploration program at Ocampo is to replace depleted reserve inventory and target further expansions of our resource model that will increase the potential for both increasing the propertys production profile and extending the mines life. Approximately 16% of the total 2007 production was mined outside of reserves & resources (20% of the underground ore), which illustrates both, the continuity of the orebody and the high potential to add to reserves. Only 20% of the Ocampo land package has been explored to date with many highly prospective areas targeted for follow up exploration.
1
The $7.5 to $8.5 million, 2008-2009 Exploration Program at Ocampo
is a four stage design that includes: El Cubo Exploration Program The goal of the 2008-2009 Exploration Program at El
Cubo is to replace depleted reserves and potentially increase the propertys
production profile. During 2006 and 2007, 40% of the gold and silver production
was mined outside of reserves & resources and this trend continued in Q1 2008,
when approximately 24% of the first quarter production was mined outside of
reserves and resources. As with Ocampo, there is high potential exploration
opportunity at El Cubo with little of the land position having been explored to
date with only 700 hectares of El Cubos 8,500 hectares of total concessions
currently being utilized. The expanded 2008-2009, $5 to $6 million
Exploration Program includes: Guadalupe y Calvo Exploration Program The goal of the 2008-2009 Exploration Program at
Guadalupe is to update the resource estimate and conduct metallurgical testwork
and mine designs to complete a scoping study for a potential open pit and
underground operation. During 2007, the Company initiated a surface channel
sampling program and a 15-hole (2,400 metre) exploration drilling program on the
Guadalupe y Calvo Exploration project. Based on results to date, the Company has
decided to significantly expand and accelerate the exploration program by
increasing the diamond drilling budget from $1.5 million to a revised $8 to $9
million which is in addition to additional funding of approximately $5 to $6
million for an advanced pre-feasibility scoping study. The diamond drilling
program has been expanded to 45,000 to 50,000 metres to support the completion
of the Advanced Scoping Study by mid-2009 which subject to underlying results,
has been engineered to facilitate the full transition into a Feasibility program
to accelerate the development of this exciting property. The Guadalupe y Calvo Project contains current
non-revised inferred resources of 1.08-million ounces of gold and 45.6-million
ounces of silver or 2.02 million gold equivalent ounces (Pincock, Allen and
Holt, Nov. 2002). This estimate is based on exploration work completed on the
Rosario and Nankin structures and does not address other mineralized structures
on the property nor the potential for strike extensions that are known to be
present within the project boundaries. Significant potential exists at the Guadalupe y
Calvo property with high grade intercepts discovered near surface and at depth.
After reviewing the results of a prior 37-hole drill program as well as results
to date from its current program, the Company believes the mineralized structure
remains open along strike and at depth.
A development and drilling program at
the advanced exploration Santa Eduviges underground target, which is located
beneath the Ocampo open pits and has the potential to become a third, long
term source of mill feed;
A 40,000 to 45,000 metre drilling
program that will focus on the further delineation of identified drill
priorities at: Villalpando, La Loca/Dolores, San Nicolas and secondary targets
at: San Francisco Poniente, Imaculada, Vein 178, Soledad, Milenio, La Luz,
Villalpando del Alto and Tuberos;
2
About Gammon Gold Gammon Gold Inc. is a Nova Scotia based mid-tier
gold and silver producer with properties in Mexico. The Companys 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. For further information please visit the Gammon
Gold website at www.gammongold.com or
contact: Cautionary Statement Cautionary Note to US Investors
Rene Marion
Anne Day
Chief Executive Officer
Director of Investor Relations
Gammon Gold Inc.
Gammon Gold Inc.
902-468-0614
902-468-0614
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 reclamations expenses. 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 Companys 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 Companys 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.
###
3
FORM 51-102F3
MATERIAL CHANGE REPORT
Item 1 Name and Address of Company
Gammon Gold Inc.
1601 Lower Water Street, Summit Place
Suite 402
Halifax, Nova Scotia, B3J 3P6
Item 2 Date of Material Change
May 16, 2008
Item 3 News Release
The press release attached as Schedule A was released over Canada NewsWire on May 16, 2008.
Item 4 Summary of Material Change
Gammon Gold Announces a Significantly Expanded Two Year, $26 to $29 Million, 135,000 to 150,000 metre, Exploration Program Supported by Gammons Strengthened Financial Position
Gammon Gold Inc. (Gammon) (TSX:GAM and AMEX:GRS): is pleased to announce that the Companys 2008-2009 Exploration Program has been significantly expanded up to $29 million and will target reserve & resource expansions at our producing Ocampo and El Cubo mines as well as resource expansions at our highly prospective advanced exploration property, Guadalupe y Calvo.
Item 5 Full Description of Material Change
Gammon Gold Announces a Significantly Expanded Two Year, $26 to $29 Million, 135,000 to 150,000 metre, Exploration Program Supported by Gammons Strengthened Financial Position
Gammon Gold Inc. (Gammon) (TSX:GAM and AMEX:GRS):
is pleased to announce that the Companys 2008-2009 Exploration Program has been significantly expanded up to $29 million and will target reserve & resource expansions at our producing Ocampo and El Cubo mines as well as resource expansions at our highly prospective advanced exploration property, Guadalupe y Calvo.The significant upturn in operational performance at Ocampo and El Cubo is continuing to drive significant improvements in the Companys cash flow profile, which combined with the current financial position is expected to be more than sufficient to fully fund this expanded Exploration Program.
In addition to the reserve & resource expansion objectives at Ocampo and El Cubo, a large portion of the increased funding will be allocated to an accelerated two year diamond drilling program at Guadalupe y Calvo of up to 50,000 metres that will support the completion of an Advanced Scoping Study by mid-2009, which subject to underlying results, has been engineered to facilitate the full transition into a Feasibility program to accelerate the development of this exciting prospective property.
Over the past two years the Company has primarily focused its attention and financial resources on the construction and commissioning of the Ocampo mine and subsequently there has been minimal exploration activity conducted during this period. However, the ongoing performance improvements at both Ocampo and El Cubo have advanced to such a degree that management can now leverage the improving cash flow profile to fully fund this expanded exploration program.
The increased $26 to $29 million 20082009 exploration program demonstrates the confidence we have in both our cash flow profile and in the potential of our assets. With the Companys improved financial foundation, we are now in a better position than ever before to focus on an important value lever of the business that has been largely inactive for the past two years. stated Rene Marion, Chief Executive Officer of Gammon Gold. He continued, The augmented exploration program will enhance our ability to target reserve and resource expansions at our producing mines, Ocampo and El Cubo, that will further increase the potential for improved production profiles in the future. In addition, the increased funding will also allow us to further accelerate the development of our exciting advanced exploration project, Guadalupe y Calvo. The continued development of our highly prospective assets and land package is integral to our organic growth vision and we are now in a stronger position than ever to execute on the longer term supporting strategy.
Ocampo Exploration Program
The goal of the exploration program at Ocampo is to replace depleted reserve inventory and target further expansions of our resource model that will increase the potential for both increasing the propertys production profile and extending the mines life. Approximately 16% of the total 2007 production was mined outside of reserves & resources (20% of the underground ore), which illustrates both, the continuity of the orebody and the high potential to add to reserves. Only 20% of the Ocampo land package has been explored to date with many highly prospective areas targeted for follow up exploration.
The $7.5 to $8.5 million, 2008-2009 Exploration Program at Ocampo is a four stage design that includes:
El Cubo Exploration Program
The goal of the 2008-2009 Exploration Program at El Cubo is to replace depleted reserves and potentially increase the propertys production profile. During 2006 and 2007, 40% of the gold and silver production was mined outside of reserves & resources and this trend continued in Q1 2008, when approximately 24% of the first quarter production was mined outside of reserves and resources. As with Ocampo, there is high potential exploration opportunity at El Cubo with little of the land position having been explored to date with only 700 hectares of El Cubos 8,500 hectares of total concessions currently being utilized.
The expanded 2008-2009, $5 to $6 million Exploration Program includes:
Guadalupe y Calvo Exploration Program
The goal of the 2008-2009 Exploration Program at Guadalupe is to update the resource estimate and conduct metallurgical testwork and mine designs to complete a scoping study for a potential open pit and underground operation. During 2007, the Company initiated a surface channel sampling program and a 15-hole (2,400 metre) exploration drilling program on the Guadalupe y Calvo Exploration project. Based on results to date, the Company has decided to significantly expand and accelerate the exploration program by increasing the diamond drilling budget from $1.5 million to a revised $8 to $9 million which is in addition to additional funding of approximately $5 to $6 million for an advanced pre-feasibility scoping study. The diamond drilling program has been expanded to 45,000 to 50,000 metres to support the completion of the Advanced Scoping Study by mid-2009 which subject to underlying results, has been engineered to facilitate the full transition into a Feasibility program to accelerate the development of this exciting property.
The Guadalupe y Calvo Project contains current non-revised inferred resources of 1.08-million ounces of gold and 45.6-million ounces of silver or 2.02 million gold equivalent ounces (Pincock, Allen and Holt, Nov. 2002). This estimate is based on exploration work completed on the Rosario and Nankin structures and does not address other mineralized structures on the property nor the potential for strike extensions that are known to be present within the project boundaries.
Significant potential exists at the Guadalupe y Calvo property with high grade intercepts discovered near surface and at depth. After reviewing the results of a prior 37-hole drill program as well as results to date from its current program, the Company believes the mineralized structure remains open along strike and at depth.
About Gammon Gold Gammon Gold Inc. is a Nova Scotia based mid-tier
gold and silver producer with properties in Mexico. The Companys 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. For further information please visit
the Gammon Gold website at www.gammongold.com
or contact:
Scott Perry
Anne Day
Chief Financial Officer
Director of Investor Relations
Gammon Gold Inc.
Gammon Gold Inc.
902-468-0614
902-468-0614
Item 6 Reliance of subsection 7.1(2) or (3) of National Instrument 51-102
Not applicable.
Item 7 Omitted Information
Not applicable.
Item 8 Executive Officer
Rene Marion
Chief Executive Officer
Gammon Gold Inc.
Tel: 902-468-0614
Item 9 Date of Report
May 16, 2008
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