Apollo Gold Updates Progress on the Montana Tunnels Mine Joint Venture

Apollo Gold Updates Progress on the Montana Tunnels Mine Joint Venture

Apollo Gold Corporation is pleased to report on the progress of the open-pit wall remediation work and the development of the new wall ramp at its Montana Tunnels Mine (the ”Mineã¢â‚¬Â), located near Helena, Montana.

As previously announced, on August 1, 2006, Apollo entered into a joint venture (the ”JV Agreementã¢â‚¬Â) with Elkhorn Tunnels, LLC (”Elkhornã¢â‚¬Â), an affiliate of Calim Private Equity LLC (”Calimã¢â‚¬Â), in respect of the Mine. The JV Agreement calls for Elkhorn to earn up to a 50% interest in the Mine by contributing $13 million over a five-month period. Elkhorn has advanced an aggregate of $3.8 million to date pursuant to the JV Agreement.

Montana Tunnels commenced its remediation program on August 10, 2006 with the hiring of key maintenance personnel to repair the mobile equipment fleet followed by the hiring of mine operating personnel during the first week of September, 2006. On September 10, 2006 the first bench was blasted and we began waste rock removal and construction of a new access ramp to the open-pit ore reserves. We have excavated approximately 750,000 tons to date. On a daily basis we are excavating approximately 58,000 tons and we expect that this amount will increase during October as a fourth shift is introduced and an additional shovel is employed. The remediation plan calls for the unloading of 5 million tons from the upper benches of the east wall of the open-pit to mitigate rock fall hazards by reducing slope deformation and rock mass degradation in the weak rock units exposed along the upper east wall. The plan also calls for a new, wider haul ramp to reduce the potential for haul ramp instability along the east wall. In addition, the plan contemplates the removal of 2.5 million tons of waste from the pit bottom with the mill commencing operations in February 2007.

David Russell, President and CEO of Apollo said, ”I am very happy with the quick and smooth start of the open-pit as well as with progress on the new ramp excavation and remediation work. We have a solid management team at the mine headed up by the VP&General Manager, Tim Smith who will work diligently to bring Montana Tunnels back into production on schedule. The JV partnership with the Elkhorn group is working well and we anticipate that once the mine is brought back into production it will be a source of positive cash flow for Apollo.ã¢â‚¬Â

Since the Mine entered production in 1987 it has produced 1,500,000 ounces of gold, 28,000,000 ounces of silver, 390 million pounds of lead and over 1 billion pounds of zinc. The following is the most recent information on reserves at the Mine as reported in Apollo’s Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2005: 33,241,000 tons of ore with gold grades of 0.016 ounces per ton; silver grades of 0.212 ounces per ton; lead grades of 0.185 % and zinc grades of 0.598 % for total gold reserve ounces of 535,900.

Patrick Imeson, Managing Director of Calim, stated, ”We are very pleased with the quick start-up at the Mine and progress to date and believe the Mine to be a great asset with capable management and operational capability. Our strategy is to search out niches where we can develop undervalued opportunities, that larger players in an industry have overlooked or are unable to exploit and Montana Tunnels is such an asset. We look forward to the successful completion of the remediation project and the Mine going back into production.ã¢â‚¬Â

Apollo Gold Corporation

Apollo is a gold mining and exploration company with the Montana Tunnels Mine described above, the Black Fox advanced stage development project in Ontario, Canada, and the Huizopa Project, an early stage exploration project in the Sierra Madre Gold Belt in Chihuahua, Mexico.

Calim Private Equity, LLC

Colorado-based, Calim Private Equity LLC focuses on investment and company development opportunities created by new technologies, expanding markets or underdeveloped assets.


This press release includes ”Forward-Looking Statementsã¢â‚¬Â within the meaning of section 21E of the United States Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by the use of words such as ”may,ã¢â‚¬Â ”should,ã¢â‚¬Â ”expects,ã¢â‚¬Â ”plans,ã¢â‚¬Â ”anticipates,ã¢â‚¬Â ”believes,ã¢â‚¬Â ”estimates,ã¢â‚¬Â ”predicts,ã¢â‚¬Â ”intends,ã¢â‚¬Â ”continue,ã¢â‚¬Â or the negative of such terms, or other comparable terminology. All statements regarding planned remediation activities, financial contributions by Elkhorn future intentions, the ability of the Company to effectively remediate the east wall instability problems affecting the Montana Tunnels Mine, to otherwise successfully effect the remediation program for the Montana Tunnels Mine, to bring the Mine back into production in 2007 and generate positive cash flow, and statements respecting reserves with respect or relating to the Montana Tunnels Mine are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from these forward-looking statements include: additional operational and remediation problems at the Montana Tunnels Mine, the failure of Elkhorn to make the expected contributions under the JV agreement, unexpected changes in business and economic conditions, political or economic instability, significant decreases in gold, zinc or lead prices, changes in interest and currency rates, local and community impacts and issues, labor accidents, environmental risks and other factors disclosed under the heading ”Risk Factorsã¢â‚¬Â in Apollo’s most recent annual report on Form 10-K filed with the United States Securities and Exchange Commission and elsewhere in Apollo’s documents filed from time to time with the Toronto Stock Exchange, The American Stock Exchange, The United States Securities and Exchange Commission and other regulatory authorities. All forward-looking statements included in this press release are based on information available to Apollo on the date hereof. Apollo assumes no obligation to update any forward-looking statements.

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