Energem - acquires jatropha based bio-diesel project



    TSX: ENM

    VANCOUVER, Aug. 1 /CNW/ - Energem Resources Inc ("Energem" or "the
Company") is pleased to announce that it has acquired a 70% controlling
interest in a jatropha based bio-diesel venture in Mozambique. Furthermore,
the company has taken on a senior management team with extensive experience of
plantation management and biofuels in the region. This management team will
retain a 30% interest in the venture.
    The venture, which was initiated some three years ago, now renamed
Energem Renewable Energy Limited, forms part of Energem's recently established
Biofuels division. The venture has established jatropha seedling nursery
facilities, and has commenced the clearing and planting of 1000 hectares of
land in Mozambique. Core to the project is three years of research and
development into the use of jatropha in Mozambique as a crop to produce oil
for transesterification and further refining to bio-diesel.
    Energem has acquired its 70% equity interest in the venture in exchange
for a commitment to fund the further development of the project for an amount
of up to US$5.5 million. This amount is expected to be required over the next
year to fully plant the initial 1000 hectares, clear and commence planting on
a further 5000 hectares, acquire additional land of up to 60,000 hectares
(presently under application from the Mozambiquan Government), and produce a
first crop of unrefined jatropha seed oil to confirm expected yields and oil
quality.
    Jatropha is a hardy plant which produces high yields of oil suitable for
refining into bio-diesel. Jatropha is not suitable for either human or animal
consumption and will not compete with food crop production, as the land to be
used is not suited to the growing of food crops. The land to be used does not
require the clearing of any indigenous forest.
    This acquisition is consistent with Energem's recently announced,
redefined strategic focus, primarily on the mid-stream oil and gas
infrastructure and biofuels sectors. As part of this process, the Company has
established a new operating division, Energem Biofuels, with the Kisumu
Ethanol Plant in Kenya at its core.
    The Company believes that these core sectors have enormous potential and
scalability across the African continent, and that Energem is well placed to
be a major player in their development.

    This news release contains forward-looking statements which address
future events and conditions which are subject to various risks and
uncertainties. The actual results could differ materially from those
anticipated in such forward-looking statements as a result of numerous
factors, some of which may be beyond the Company's control. These factors
include: the availability of funds; the costs and availability of fuel
products; fluctuations in fuel product sale prices; currency fluctuations;
changes in production costs; fluctuation in shipping costs; availability of
shipping; general market and industry conditions; political and regulatory
instability and risks associated with rights to title and ownership of fuel
products.
    Forward-looking statements are based on the expectations and opinions of
the Company's management on the date the statements are made. The assumptions
used in the preparation of such statements, although considered reasonable at
the time of preparation, may prove to be imprecise and, as such, undue
reliance should not be placed on forward-looking statements.

    Energem Resources Inc. is a natural resources company listed on the
Toronto Stock Exchange with projects in the energy and mining sectors in a
number of African countries. Energem is committed to developing niche high
margin natural resource projects in Africa and is currently active in 16
countries. Ventures encompass diamond mining and mineral exploration, mid- and
up-stream oil and gas projects, energy and mining related manufacturing,
trading and trade finance businesses operating off a common logistics platform
and infrastructure. The company has offices and/or logistics and support
infrastructure in Johannesburg, London, Beijing and a number of African
countries.

    %SEDAR: 00002462E




For further information:

For further information: Rob Rainey in Johannesburg at telephone +27 11
372-3300, Fax +27 11 454-1673 or email: info@energem.com; Refer our website:
www.energem.com

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ENERGEM RESOURCES INC.

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