KENMARE Resources and BHP have signed a joint venture agreement covering exploration and possible development of the Congolone mineral sand project in northern Mozambique. This follows a memorandum of understanding between the companies.

Work to date has estimated resources of 50.5 million tons of ilmenite measured and 46.3 million tons indicated. Kenmare said further work needed to be done to evaluate additional exploration potential. Under the agreement, BHP earns a 75 per cent interest in the project after spending 524 million. After this has been invested, Kenmare can retain its stake by funding its pro rata share of development costs or by reducing its stake. Operations are expected to start immediately.