Kenmare Resources plc ("Kenmare" or "the Company")
26 January 2010
Moma Update
Production
During the fourth quarter of 2009, production of heavy mineral concentrate at
the Company's Moma Titanium Minerals Mine increased by 22% (from 230,000 tonnes
to 280,200 tonnes) compared to the previous quarter. Production of heavy mineral
concentrate is now at full design level.
Processing of this concentrate resulted in a 13% increase in production of
finished ilmenite (from 130,000 tonnes to 147,100 tonnes) compared to the
previous quarter. Zircon production in the fourth quarter was at similar levels
to the previous quarter at 5,400 tonnes, mainly as a result of disruptions to
zircon production associated with the implementation of further metallurgical
optimisation projects. Since year end, additional equipment has been
commissioned in the zircon circuit and zircon production has improved
significantly.
Tonnage of finished products delivered to customers' vessels was up 6% in the
fourth quarter (from 131,000 tonnes to 139,000 tonnes) compared to the previous
quarter, continuing the upward trend in production and shipments shown in
previous quarters.
In the second half of 2009, production of heavy mineral concentrate increased by
61% to 510,200 tonnes compared to the first half of 2009; ilmenite production
increased by 39% to 276,358 tonnes compared to the first half of 2009; and
tonnes of finished products shipped increased by 83% to 270,000 tonnes compared
to the first half of 2009.
The mineral separation plant is now capable of operating at the target feed
rate. However, the recovery of minerals in this plant is below target. It is
expected that existing metallurgical optimisation projects should bring these
recoveries to target levels during the first half of 2010.
The plant configuration is such that rutile and zircon production are
interlinked and hence it is expected that improvement in rutile output will
follow the optimisation of the zircon circuits currently in progress. The
majority of this work is expected to be completed during the first quarter of
2010.
Expansion Study
In January 2010, Kenmare completed an Expansion Study, utilising the services of
a number of independent consultants, investigating plans for  increasing
production at its Moma Mine which resulted in options for potential increases in
production by  approximately 50% to 1.2 million tonnes of ilmenite per annum
plus associated co-products. Kenmare has commenced a detailed engineering study
under the supervision of Aker Solutions E&C Limited. This study is expected to
be completed by the end of the second quarter of 2010.
Under such plans, Kenmare would expect to both significantly increase existing
levels of production and also extend the life of the mine by expanding
operations to the adjacent Nataka resource, which contains in excess of 140
million tonnes of heavy mineral and is expected to sustain production well
beyond 2050.
The Company will continue to evaluate the results of this study and the ongoing
detailed Engineering Study when completed and monitor the outlook for the end
markets for its products.
Market Update
The current market outlook is for a continued rebound in pigment demand in 2010
that is expected to lead to strong demand for titanium minerals, principally
driven by increased demand from China and other developing countries. Demand for
zircon is also expected to rebound strongly in 2010 led by growth in China and a
recovery in Europe. Kenmare's supply and demand analysis and that of other
titanium industry analysts indicate that the industry will experience strong
demand growth over the next five years.
Kenmare's Chairman, Charles Carvill, said:
"We are delighted with the continued production improvements at Moma and the
improving market outlook for titanium minerals and zircon. We believe that
Kenmare is well placed to take advantage of these strong markets given its large
resource base at Moma and its facilities at the mine. With the completion of the
recent Expansion Study the Company has taken an important first step towards
putting itself in a position to further capitalise on this market opportunity
should it seek to do so."
For more information:
Kenmare Resources plc
Michael Carvill, Managing Director
Tel: +353 1 671 0411
Mob: + 353 87 674 0110
Murray Consultants
Jim Milton/Joe Heron
Tel: +353 1 498 0300
Mob: + 353 86 255 8400
Conduit PR Ltd
Leesa Peters/Charlie Geller
Tel: +44 207 429 6600
Mob: +44 781 215 9885
www.kenmareresources.com <
http://www.kenmareresources.com/>
[HUG#1377139]
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