Apollo Gold Announces 1,000,000 Ounces Of

Apollo Gold Announces 1,000,000 Ounces of

Gold Reserves at its Black Fox Project

Denver, Colorado – July 2, 2007 - Apollo Gold Corporation ("Apollo" or the "Company") (TSX: APG) (AMEX: AGT) is pleased to announce the results of a new Canada National Instrument 43-101 (“43-101”) mineral reserve and resource estimate at its 100% owned Black Fox Project (“Black Fox”) located near Timmins, Ontario, Canada. The NI 43-101 demonstrates the continued expansion of Black Fox since the last published NI 43-101 dated August 14, 2006. The new mineral reserve and resource estimate was prepared by SRK Consulting, Denver, Colorado. SRK has confirmed that the reserve and resource study complies in all respects with NI 43-101 guidelines. Table 1 below summarizes the Black Fox Total Mineral Reserve:

Table 1

Black Fox- Probable Reserves
Mining Method / Cutoff Grade Au g/t / Tonnes (000) / Grade
Au g/t (Average) / Contained Au Ounces
Open Pit / 1.0 / 3,362 / 5.8 / 625,000
Underground* / 3.0 / 1,108 / 10.6 / 377,000
Total Reserves / 4,470 / 7.0 / 1,002,000

* Underground Reserves include dilution of approximately 22% of which 66,000 tonnes of indicated material with an average grade of 1.26 g/t Au was used and the remaining amount of dilution material was assigned a grade of 0 g/t Au

The minable reserve was calculated based on a gold price of US$525/oz of gold which is approximately the three year average. The average total cash cost per ounce of gold was calculated at $236 per ounce.

In addition to the reserves above, the 43-101 will contain the following additional indicated and inferred resources shown in Table 2 below:

Table 2

Mineral Resource / Cutoff Au g/t / Tonnes (000) / Grade Au g/t
Indicated—Open Pit / 1.0 / 997 / 4.5
Inferred - Open Pit / 1.0 / 3,256 / 4.7
Indicated– Underground / 3.0 / 667 / 10.1
Inferred-Underground / 3.0 / 929 / 12.3

The reserve and resource estimation is based on information from 1,818 drill holes totaling 322,740 meters. All assays over 170 grams of gold per tonne were capped at this level, representing 0.25% of the assays.

Open Pit and Underground Combined Economics

The pre-feasibility study economics, using reserve ounces only, assuming a gold price of US$600 per ounce and assuming a milling capacity of 1,500 tonnes per day has a positive Net Present Value (“NPV”) of US$228 million at a 0% discount rate and an Internal Rate of Return (“IRR”) of 55%. The total cash cost per ounce of gold is calculated at $236 per ounce. Variations of NPVs and discount rates are as follows:

Table 3 – NPV Values & IRR’s (Pre-Tax)

Gold Price
US $ / oz / NPV @ 0 %
US $ millions / NPV @ 5%
US $ millions / IRR
$ 525 / 156 / 93 / 33
$ 550 / 180 / 111 / 39
$ 575 / 204 / 128 / 46
$ 600 / 228 / 145 / 55
$ 650 / 276 / 180 / 76

Economic Assumptions:

Plant Gold Recovery 96 %

Total Cash Cost* $236 per ounce gold

(* See note on non-GAAP financial measures below)

Mining Cost $28.33 per tonne ore milled

Processing Cost $18.90 per tonne ore milled

G & A Cost $ 3.90 per tonne ore milled

Total Operating $51.13 per tonne ore milled

Note: Based on Life of Mine (“LOM”) costs for open pit and underground mining as well as toll and owner operated milling.

Mining Costs (LOM average costs)

Open Pit average Mining Costs $1.63 per tonne ore mined

Underground average Mining Costs $36.75 per tonne ore mined

Capital Costs (LOM and sustaining capital)

Processing Plant and Infrastructure Capital $ 71.0 million

Pre-Stripping Open Pit $ 8.0 million

Open Pit Equipment $ 8.0 million

Underground Equipment $ 15.0 million

Underground Mine Development $ 19.0 million

Total Capital (LOM and Sustaining Capital) $121.0 million

The pre-feasibility study assumes that mining would commence in 2009 with ore being toll treated initially and then treated by an on-site mill from 2012 forward. Apollo Gold is completing a bankable feasibility study that will refine the mining sequence and total capital requirements as well as timing of capital requirements.

R. David Russell, President & CEO of Apollo, said, “I am very pleased that we have been able to increase the reserves at Black Fox to 1,000,000 ounces of gold which includes underground reserves at an average diluted / minable gold grade of better than 10.5 grams per tonne (0.31 ounces per ton). Our next objective is to complete a bankable feasibility study which will be carried out by SRK Consulting and should be completed in the first quarter 2008. In the meantime, we plan to conduct an infill drilling program underground intended to enhance the amount of inferred mineralization material which may be able to be converted to drill indicated material and then included as additional reserves within the final bankable feasibility study. Our new reserve statement is very encouraging considering that we have several drill holes that indicate the Black Fox ore body is open along strike and at depth.”

Apollo Gold Corporation

Apollo is a gold mining and exploration company which operates the Montana Tunnels Mine, which is a 50% joint venture with Elkhorn Tunnels, LLC, in Montana, the Black Fox advanced stage development project in Ontario, Canada, and the Huizopa project, an early stage exploration project in the Sierra Madres in Chihuahua, Mexico.

This press release has been reviewed and approved for release by Dr. Bart Stryhas, Professional Geologist, of SRK Consulting; David Young, Professional Mining Engineer, Associate Consultant for SRK Consulting; and Richard Nanna, Professional Geologist, Apollo's Senior Vice-President, Exploration and Development. Each of Dr. Stryhas, Mr. Young and Mr. Nanna is designated a “Qualified Person” under NI 43-101.

Since we report our mineral reserves to both NI 43-101 and SEC Industry Guide 7 standards, it is possible for our reserve figure to vary between the two. Where such a variance occurs it will arise from the differing requirements for reporting mineral reserves. For example, the NI 43-101 has a minimum requirement that reserves be supported by a pre-feasibility study, whereas SEC Industry Guide 7 requires support from a full feasibility study done to bankable standards. The Black Fox project thus reports reserves under NI43-101, but reports no reserves under SEC Industry Guide7 as a final bankable feasibility study has not been completed.

(1) Cautionary Note to US Investors concerning estimates of Indicated Mineral Resources. This press release uses the term “indicated mineral resources”. We advise US investors that while the term is recognized and required by Canadian regulations, the US Securities and Exchange Commission does not recognize it. US investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into mineral reserves.

(2) Cautionary Note to US Investors concerning estimates of Inferred Mineral Resources. This press release uses the term “inferred mineral resources”. We advise US investors that while the term is recognized and required by Canadian regulations, the US Securities and Exchange Commission does not recognize it. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. In accordance with Canadian rules, estimates of inferred mineral resources cannot form the basis of feasibility or other economic studies. US investors are cautioned not to assume that part or all of the inferred mineral resource exists, or is economically or legally minable.

Contact Information:

Investor Relations – Marlene Matsuoka

Phone: 720-886-9656 Ext. 217 Toll Free: 1-877-465-3484

E-mail: Website: www.apollogold.com


This press release includes “Forward-Looking Statements” 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,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “intends,” “continue,” or the negative of such terms, or other comparable terminology. All statements regarding estimated reserves and resources; net present values of the Black Fox project and anticipated internal rates of return; assumptions regarding Black Fox plant gold recovery, cash costs, operating costs, mining costs and capital expenditures; assumptions regarding development of a mine at Black Fox and the timing of mining and processing operations at Black Fox; completion and timing of a bankable feasibility study regarding Black Fox 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: the results of independent Canada NI 43-101 reports, the outcome of assays and additional exploration sampling and drilling efforts; delays in completing or less favorable than anticipated results of a bankable feasibility study on Black Fox; increases in anticipated cash costs, operating costs, mining costs, capital expenditures and other costs; decreases in anticipated plant gold recoveries and gold prices; delays or problems in construction, permitting and start-up; variations in ore grade, mining, or processing problems or issues, and other factors disclosed under the heading “Risk Factors” and elsewhere in Apollo 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.

Non-GAAP financial measures. In this press release, we use the term “total cash cost per ounce”. The term “total cash cost,” is considered a non-GAAP financial measure as defined in the United States Securities and Exchange Commission (the “SEC”) Regulation S-K Item 10 and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. These terms are used by management to assess performance of individual operations and to compare our performance to other gold producers. The term “total cash cost” at Black Fox is equivalent to direct operating cost as would be found on the Consolidated Statements of Operations. This measure is not necessarily indicative of operating profit or cash flow from operations as determined under GAAP and may not be comparable to similarly titled measures of other companies.