Apollo Gold

Brigus Gold Corp. (NYSE Amex: BRD) expects to produce 14,000 to 15,000 ounces of gold in the fourth quarter.  This is less than expected earlier.  The average grade from the underground mine was 2.79 g/t gold in October and November, due to dilution encountered in underground mining which was substantially less than the 6 g/t gold from average production from 1997 to 2001.  Production from underground was commensurate with grades from the open pit, at 2.71 g/t gold, which was according to the mine plan.  Recoveries from the mill were at 94% to 95%.  Brigus also has increased gold resources with it initial deposit at the Contact and 147 Zone increasing resources by 50%. 

It would appear that with optimization of underground operations, with grades from the open pit as scheduled, good recoveries at the mill, and ongoing exploration success, cash flow may improve in 2012 along with the company’s investment profile.

Brigus Gold Corp. (NYSE Amex: BRD) announced the business combination of Apollo Gold and Linear Gold on June 25, 2010. The arrangement included a one-for-four consolidation of Apollo shares, with Linear shareholders receiving 1.37 shares for each share of Brigus. Post-consolidation Brigus has 129 million basic shares outstanding and 176 million fully diluted shares. Wade Dawe is Brigus’ new CEO. The new business combines the gold producing Black Fox mine and mill, with advanced gold properties, and an improved financial and corporate structure and trading exchange capability. The combination improves the potential for increasing cash flow, successful exploration and expanding resources.

The corporate combination of Apollo Gold Corporation (NYSE Amex: AGT, TSX: APG) and Linear Gold Corp. (TSX: LRR) appears to be a good fundamental match of strengths and needs for the evolving organizations. The combination as structured should present the opportunity for upward rerating of the stock by doubling the market capitalization, consolidating the number of shares of common stock to broaden ownership, and enhancing the gold production/development/exploration profile.

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AGT.Update.10.05.30.pdf