"Tier 1" Moma mine with over 100 years of resources at current rates supplies about 6% of the global titanium minerals market, the major capital program is largely complete, and Kenmare is moving production toward the Nataka ore body to reach the processing plant target of 1.2 million tonnes per year.

Weak titanium prices led to a modest loss in 2025; Kenmare is carrying slightly higher net debt and is deferring non‑essential capex, cutting costs and prioritising shipments and sales to reduce debt, while not budgeting for a near‑term price recovery.

Kenmare is negotiating a revised Implementation Agreement with Mozambique proposing a ~4% blended royalty (retaining the right to arbitrate), and highlights strong sustainability and local impact with >90% renewable energy use, 97% Mozambican workforce, FTSE4Good inclusion and ongoing community investments.

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Kenmare Resources (LON:KMR) is the owner and operator of the Moma Titanium Minerals Mine in Mozambique, Managing Director and Executive Director Tom Hickey told attendees at a company presentation, describing the asset as a “Tier 1” operation with more than 100 years of mineral resources at the current production rate.

Hickey said Kenmare has operated in Mozambique for nearly 40 years and has been producing for almost 20 years. He added that the company is a significant presence in its operating province and “even 6% of Mozambique in exports,” making it “a very big part of the national economy.”

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Kenmare produces titanium minerals including ilmenite, zircon, and rutile. Hickey said ilmenite and rutile are used in paints, paper, plastics, and titanium metal, while zircon is used in ceramics and ceramic tiles. He characterized Kenmare as supplying about 6% of global supply and said it is “probably the fourth biggest producer,” noting that Rio Tinto is the largest producer and is evaluating a sale of its titanium minerals division.

Hickey said titanium is listed as a critical mineral in the EU, UK, and US, and he suggested tariffs are “not so much of an issue.” He added that certain trade measures have “probably been a net benefit” for Kenmare, citing trade barriers in the EU, Saudi Arabia, and “most likely India” that protect customers from imported Chinese pigments.

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Kenmare’s market capitalization is “south of $300 million,” Hickey said, while cumulative investment in its assets is “north of $1 billion.” He told investors the company is currently at what he described as a low point in the pricing cycle and has recently completed a major capital investment program intended to prepare Moma for decades of mining.

Hickey emphasized the cyclical nature of the business. He said Kenmare achieved a 60% EBITDA margin in 2022, while “in the years prior to it and the years following it, we were more like 40%.” With significantly weaker pricing, he said Kenmare made a “modest loss in 2025.”

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Following the capital program, Hickey said the company is at a “slightly higher level of net debt” and is responding by deferring non-essential capital, cutting operating costs, and focusing on shipments and sales rather than only production volumes. He said Kenmare is planning for 2026 to be challenging and is not budgeting for a near-term price rebound, expecting prices to remain broadly at current levels.

He also highlighted shareholder returns during stronger markets, saying Kenmare has been “the biggest buyer of Kenmare stock in the last 10 years” and has bought back “over 15%” of its shares in the market.

Hickey said capital investment in 2025 reduced output, with ilmenite production down 20% and heavy mineral concentrate down 15% in 2025. He expects 2026 production to be “there, thereabouts,” with output rising as mining shifts toward the Nataka ore body and the company moves toward its target of 1.2 million tons per year, which he said is the processing plant’s capacity.

The company’s largest mining plant is being upgraded to operate at Nataka, which Hickey said accounts for 70% of reserves. The upgrade included two new dredgers, each “as long as a jumbo jet,” according to Hickey. He said Kenmare is “pretty much through” the capital program, with 80% completed by the end of 2025, and expects 2026 capital spending to be about 30% of the prior year’s level.

Looking beyond the current work, Hickey said Kenmare has “no obligatory CapEx going forward other than sustaining CapEx,” describing cash flows as “unencumbered from 2026-2027 onwards.”

Hickey attributed softer demand to post-pandemic shifts in consumer spending, higher interest rates, and weakness in the Chinese property market, as well as conflicts affecting global activity. He said the sector also faced new supply, including what he described as less complex Chinese producers targeting high-grade “sweet spots” with low-capex approaches that are “not scalable to the full ore body.”

Despite the pricing environment, Hickey said Kenmare’s customer relationships have remained stable and are built around quality and reliability. “The customers we had when we started in 2008, 2009 are still the customers we have today,” he said, adding that about 60% of products are sold on long-term contracts that are volume certain, with prices revised once or twice a year.

He said zircon pricing stabilized toward the back end of 2025 and has “started to see pricing tick up” recently, with “better pricing being invoiced” for the second quarter. He expressed hope zircon could “foreshadow a recovery in ilmenite,” while noting the company is not relying on that in its planning. Hickey also cited industry commentator TZMI, saying its first-quarter outlook became “significantly more positively” skewed for ilmenite and zircon for coming years.

In a Q&A discussion, Hickey said the titanium market is “quite opaque” and that prices can vary by customer and location. He added that when pricing is weaker, larger producers may reduce volumes to help accelerate price recovery, and he referenced TZMI’s view that there will be a production deficit in ilmenite that could absorb inventory.

Hickey discussed ongoing negotiations with the government of Mozambique related to an “Implementation Agreement” first signed in 2002. He said the original framework included a 1% royalty and exemptions from corporate tax, VAT, and customs duties for processing and export activities, though he noted Kenmare’s mining company pays corporate tax. He said Kenmare has proposed a higher blended royalty rate of about 4% and is seeking a negotiated outcome, while retaining the right to pursue international arbitration in Washington as a last resort.

On sustainability, Hickey said Kenmare was included in the FTSE4Good Index in June 2025 and described community investments such as an 80%-complete local hospital, school support, microfinance initiatives, and supplier upskilling. He said Kenmare spends $3 million to $4 million per year through a not-for-profit organization on community programs. Hickey also said 2025 was a very safe year and highlighted strong safety performance over the past two years, including a development project that went five years without a lost-time injury.

Hickey said more than 90% of the company’s energy use comes from renewable power from the Cahora Bassa Dam, describing Kenmare as a low carbon footprint producer. He also noted the workforce is 97% Mozambican and that the general manager is Mozambican, with a small number of expatriates on rotation.

For 2026, Hickey said Kenmare’s operational focus has shifted toward maximizing shipments to generate revenue and reduce debt, while increasing production in future years to lower unit costs and position the business for a market recovery.

The article "Kenmare Resources Calls Moma Mine “Tier 1,” Targets Debt Cut as Titanium Prices Stay Weak" was originally published by MarketBeat.