Gammon Gold has lowered its 2010 production and cash outlook for the Ocampo mine due to the suspension of operations at its El Cubo mine in Mexico.

Gammon expects gold production to remain between 100,000oz and 110,000oz of gold compared to the 150,000oz to 180,000oz previously announced by the company.

Gammon has also lowered its outlook for silver production to 4.95 million ounces from the previous estimate of 6.8 million ounces.

The total cash costs are expected to be around $450 per gold equivalent ounce, down from $475.

A labour dispute has resulted in suspension of operations at Gammon’s El Cubo mine with 397 union miners losing their jobs.