rhel5: kdump kernel ends in "Kernel panic - not synching: out of memory and no killable processes"

Issue

• kdump kernel ends in "Kernel panic - not synching: out of memory and no killable processes"
• I use this kdump.conf:

path /var/adm/dumps
core_collector makedumpfile -d 31 -c
blacklist iomemory-vsl lpfc

• service kdump status reports: Kdump is operational
• But I do not get the dump., all I am getting on the console is: "Kernel panic - not synching: out of memory and no killable processes" and I need to do a hard reset of the box.
• After initiating a kdump, I get this which looks like a usual RHEL boot at the end:

Creating block device ram6
Creating block device ram7
Creating block device ram8
Creating block device ram9
Creating block device vda
 vda: vda1 vda2 vda3
Making device-mapper control node
Scanning logical volumes
  Reading all physical volumes.  This may take a while...
  Found volume group "volgr" using metadata type lvm2
Activating logical volumes
  1 logical volume(s) in volume group "volgr" now active
Saving to the local filesystem /dev/mapper/volgr-lvtest
e2fsck 1.38 (30-Jun-2005)
/dev/mapper/volgr-lvtest: recovering journal
input: ImExPS/2 Generic Explorer Mouse as /class/input/input1
/dev/mapper/volgr-lvtest: clean, 15/979200 files, 70293/1955840 blocks
mount: Mounting /dev/mapper/volgr-lvtest on /mnt failed: No such device
Attempting to enter user-space to capture vmcore
Creating root device.
Checking root filesystem.
fsck 1.38 (30-Jun-2005)
fsck: fsck.ext4: not found
fsck: Error 2 while executing fsck.ext4 for /dev/vda2
Mounting root filesystem.
Trying mount -t ext4 /dev/vda2 /sysroot
EXT4-fs (vda2): recovery complete
EXT4-fs (vda2): mounted filesystem with ordered data mode
Using ext4 on root filesystem
Switching to new root and running init.
SELinux:  Disabled at runtime.
type=1404 audit(1434632623.162:2): selinux=0 auid=4294967295 ses=4294967295
INIT: version 2.86 booting
                Welcome to Red Hat Enterprise Linux Server
                Press 'I' to enter interactive startup.
Setting clock  (localtime): Thu Jun 18 09:03:44 EDT 2015 [  OK  ]
Starting udev: [  OK  ]
Loading default keymap (us): [  OK  ]
Setting hostname rhel5u9a.fluxcoil.net:  [  OK  ]
Setting up Logical Volume Management:   1 logical volume(s) in volume group "volgr" now active
[  OK  ]
Mounting local filesystems:  [  OK  ]
Enabling local filesystem quotas:  [  OK  ]
[...]

• When attempting to kdump, I seem to get my usual system up and running - but with a very low amount of ram (as reported by i.e. "free").