2001 Chairman's Statement

Kenmare Resources PLC
20 June 2002


               Kenmare Resources plc ('Kenmare' or 'the Company')

                           2001 Chairman's Statement


In our last annual report, I outlined Kenmare's focus on converting the Moma
Titanium Minerals Deposit into an operating mine. The main task areas are the
negotiation of sales contracts and the arranging of the necessary funding. I am
delighted to say that we have had considerable success in both these areas.


In May 2002 Kenmare signed an offtake agreement with one of the world's largest
users of TiO2 feedstocks. This contract was signed, despite a generally soft
market following the US economic slowdown. It represents a significant
proportion of the project's ilmenite output and we anticipate it forming the
cornerstone of our evolving offtake arrangements.


In addition to this contract, we have reached outline agreement with consumers
of zircon. The agreements cover our total anticipated zircon output. We are
working with these parties to develop bankable documents. We are also in
discussion with several other major ilmenite and rutile consumers although these
discussions are not at such an advanced stage.

On funding, we appointed N. M. Rothschild & Sons Ltd. as our financial advisor
in June of last year. Working with Rothschild and the Government of Mozambique,
we have finalised our Mineral Licensing Agreement, signed an Implementation
Agreement covering an Industrial Free Zone from which the project benefits, and
agreed a power tariff formula. These activities were completed by the end of
January 2002, allowing us to approach the Development Finance Institutions. I am
pleased to say that these funders reacted positively and, subject to due
diligence, satisfactory completion of the offtake negotiations and raising of
additional equity, have provided expressions of interest to provide senior and/
or mezzanine finance amounting to circa US$280 million. This total exceeds the
Project's likely debt requirement by some US$70 million, providing Kenmare with
increased confidence that these expressions of interest can, in the course of
the next few months, be converted into the required +/-US$210 million of firm
loan commitments. The funding institutions are advancing their interest
concurrently with marketing negotiations.


We have appointed an independent engineering company who will work on behalf of
the lenders to assess the project, and legal counsel who will represent the
lenders on project related legal issues such as the drawing up of documentation.
The inaugural meeting of the lenders committee occurred in June.


In the meantime, Kenmare has completed the largest equity capital raising in its
history. €16.4 million was raised in May 2002 from institutions and private
shareholders. This money will be used principally for the due diligence process,
and for various aspects of final design which are still ongoing. Funds will also
be used for the dismantling of the separator plant purchased from BHP and
payments on that plant. When debt arrangements are complete the residual amount
will be contributed to the project as equity.


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.


During the year Peter McAleer joined the Board. Peter has worked in the resource
industry for 25 years and has been involved with the funding of many successful
mining projects. He has been a great help to the executive as they work to
structure a very complicated funding situation.


In summary, we have signed with a major consumer and are advanced in other
market negotiations; we have raised €16.4 million; we have negotiated the
Minerals Licensing and Implementation Agreements; we have received expressions
of interest from lenders; we have appointed legal counsel and independent
engineer to the lenders, and we have held the inaugural lending meeting. We are
dedicated to continuing to push this project forward with all possible speed.


Charles Carvill, Chairman


For more information:

Tony McCluskey
Financial Director
[phone] or [phone]


Tom Byrne
Murray Consultants
[phone] or [phone]


Tim Blackstone
Blackstone Communications
[phone]

www.kenmareresources.com


20 June, 2002

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