Fundamental studies were undertaken to evaluate the underlying principles by which gold is recovered by coal-oil agglomerates. The effects of various parameters such as oil:coal ratios, agglomerate:ore ratios, pH and coal particle size on gold recovery were evaluated using synthetic gold bearing samples; bituminous coal; and diesel oil and kerosene. The effects of sulfides on gold recovery and the depth of gold particle penetration within the agglomerates were also investigated. Results showed that gold recovery was increased by increasing agglomerate:ore ratio, decreasing oil:coal ratio and decreasing coal particle size. There was no significant difference in gold recoveries at pH range of 4-12 and at up to 5% sulfides in the feed. Microscopic studies indicated that at prolonged mixing time, some gold particles were observed to have penetrated the agglomerates some 60 mu m from the surface.