KMR Kenmare Resources Plc

RNS Number:7247W
Kenmare Resources PLC
4 January 2001

Kenmare Resources plc ("Kenmare" or "the Company") Announcement

Kenmare signs Mineral Licence Agreement over Moma Titanium Project

Kenmare Resources plc and the Mozambican Government have signed a Mineral
Licence Agreement (MLA) covering the Moma Titanium Project.  This agreement
formally grants Kenmare the right to mine titanium minerals on terms that
support the rapid development of the project.  It provides for the conversion
of the existing exploration licences to a mining licence and is an important
component in the Definitive Feasibility Study due to be finalised early this
year.

The MLA covers an initial period of 25 years of mining, and is renewable
thereafter.  It grants Kenmare rights over a total area of 100,518 hectares. 
This licence includes an initial mining area of 15,240 hectares and allows for
significant future resource expansion.

The MLA provides rights to Kenmare which will facilitate the operation of the
mine and protect the capital investment necessary to create it, including
security of tenure, land access, water use rights and employment of personnel.

For tax purposes, the Moma Titanium Project is covered by a mining regime and
a processing regime.  The approval of the processing regime, known as the
Industrial Free Zone (IFZ), was announced on 20 December 2000, establishing
favourable fiscal terms.  The MLA provides that the mining operations will
also be covered by concessionary fiscal terms.  Both regimes exempt all
activities from import duties, export duties and value added tax. Under the
IFZ regime, no corporation tax is payable and a 1% turnover tax is payable
after year 6 of production.  Under the mining regime, a royalty of 3% is
payable on the value of the mining production.  The combined effect of these
regimes will result in an extremely low effective rate of tax for the project.

Mozambique has established itself as an attractive location for direct inward
foreign investment.  It has prioritised natural resources as an area for rapid
development and has provided a progressive fiscal and regulatory environment. 
In this context, the Kenmare Moma Titanium Project has received excellent
support from the Government of Mozambique in the completion of the MLA and
IFZ.


Charles Carvill, Kenmare's Chairman, said:

"The approval of the Mineral Licence Agreement is another important milestone
which brings us one step closer to the development of the Moma Titanium Mine. 
The MLA terms, together with the Industrial Free Zone regime, greatly enhance
the attractiveness of the project and will contribute to its rapid
development.

We can now look forward to the publication of the Definitive Feasibility
Study, which is nearing completion, early in the year."


For more information :

Michael Carvill                                          Tony McCluskey
Managing Director                                    Financial Director
+353-1-671 0411 or +353-87-6740110   +353-1-671 0411 or +353-87-6740346


4 January 2001



Kenmare Website:  www.kenmareresources.com

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