Announcements - 9th April 2002

2001 Preliminary Results Chairman's Statement

Dear Shareholder,

In my last statement, contained in the 2001 Interim Report, I stated that the focus of our activities in the coming period would be on financing and development of the Moma Titanium Minerals Project in Mozambique and on marketing of the minerals which will be produced at Moma. These tasks are "two sides of the same coin" as completion of financing requires that a substantial component of our production be locked up in off-take contracts. Moreover, our potential customers are keen to see progress in funding prior to committing to off-take arrangements. We have therefore been engaged in a process of moving both aspects of this situation forward concurrently.

In January, Kenmare and the Government of Mozambique signed an Implementation Agreement and a modified Mineral Licensing Agreement. These documents regulate the operation of the Moma Project through its life and describe precisely the ongoing relationship with the Government. The signing of these agreements allowed Kenmare, accompanied by our financial advisors, N. M. Rothschild, to approach development finance institutions and commercial banks with a financing plan and a proposal that they participate in the debt funding package.

The responses to these contacts were positive and we have so far received Expressions of Interest to provide loans totalling US$130 million. These Expressions have been provided by a group of development finance institutions which will shortly begin their due diligence processes and commence detailed negotiations. Kenmare is still awaiting responses from a number of similar institutions, which are expected to join these processes.

While the global economic slowdown in 2001 was a difficult environment for market negotiations with customers, substantial progress has been made in advancing long term product off-take commitments. We anticipate being able to convert this progress into signed agreements as our financial arrangements firm up.

The loss for 2001 arises largely from the provision for the remaining value of the Niassa Gold Mineral Interest. As outlined in the 2001 Interim Report, this was due to the low gold price and the decision to focus Company resources on the Moma Project.

I would like to welcome Peter McAleer, who joined the board in October 2001. Peter has extensive experience in financing, development, and running of major resources projects in several countries and we expect he will make a major contribution to the Company.

Finally, I see the Placing commitments for Euro 13 million, announced earlier this week as part of the proposed Placing and Open Offer, as a strong endorsement of our strategy for Moma. Together with the Expressions of Interest by the development finance institutions, these are important steps in advancing the financing of the Moma Project and in advancing project implementation later this year. I look forward to presenting further detail in the Listing Particulars, which will be posted to shareholders shortly, and urge you to support the Placing and Open Offer.

Charles Carvill

Chairman

9 April 2002

Download PDF Version of 2001 Preliminary Results Chairman's Statement

For further information:

Michael Carvill
Managing Director
+353-1-671 0411
+353-87-674 0110

Murray Consultants
Tom Byrne
+353-1-632 6400
+353-86-810 4224

Blackstone Business Communications
Tim Blackstone
+44-207-251 2544