Image Resources (ASX: IMA) Explorers 2020

THE CONFERENCE CALLER: Image Resources kicked off 2019 by loading its first bulk shipment of nominally 10,000 wet metric tonnes of heavy mineral concentrate (HMC) from the company’s 100 per cent-owned Boonanarring mineral sands project, located north of Perth in Western Australia.

From there on the company barely looked back with production and sales results from Booonanarring in line with expectations and meeting its 2019 Calendar Year guidance figures, which were increased twice during the year.

“It is pleasing…preliminary results for our inaugural full year of operations meet guidance and representations to our shareholders and the market and we look forward to our second year of operations and opportunities to further grow the value of the Company,” Image Resources managing director and CEO Patrick Mutz said.

“In 2020 we will seek to build upon our operational successes by prioritising the addition of new Ore Reserves from existing and new Mineral Resources, while maintaining profitable operations and striving for continuous improvement of our safety, environmental protection and community support programs.

“We have already commenced a robust and systematic exploration program which is designed to extend the mine life at Boonanarring and we are focusing on areas within economic pumping distance of the existing Wet Concentrate Plant.

“We will also continue to assess opportunities to add further incremental value to our high-quality HMC product.”

2019 was not just about production and shipping targets and the company made great advances in exploration from drilling aimed at extending the mine-life at Boonanarring by identifying a new mineralised shoreline trend to the west of and parallel to the Boonanarring Ore Reserve area.

Based on drill sample assays and ground based magnetic survey results, it is believed this trend may potentially extend for up to 40 kilometres.

These results came in addition to an independent program of close-spaced drilling conducted across the eastern strand of the Boonanarring Ore Reserve for the purpose of reassessing the current Ore Reserve.

Further drilling aimed at extending the mine life at Boonanarring was conducted in target areas to the north, south and west of the current Boonanarring Ore Reserve.

The early results from this were positive and were what led to the identification of this new mineralized shoreline which was labelled 50mRL Strandline, as mineralised intercepts range from 48 to 55m RL.

The 50mRL Strandline was interpreted to extend up to 40km from south of the town of Gingin to north of the Boonanarring Northern Extension and includes previously identified mineralisation in the western sections of Image’s Gingin South and Gingin North projects, and was subsequently found to include the Boonanarring West mineralisation.

At the time of writing an extensive drilling program of a total 528 holes was being planned over the most promising areas identified along the 40km 50mRL Strandline.

Access for drilling was available for 40 per cent of the planned holes and the company was seeking to complete the remaining access with three landholders.

All planned drilling is within economic pumping distance of the current Boonanarring wet concentration plant and is considered high-priority.

Just before the Christmas break Image Resources updated the Ore Reserves at Boonanarring, resulting in a 24 per cent increase in the total heavy minerals (THM) ore grade and a 50 per cent increase in the in-situ zircon grade.

Ore grade increased to 8.9 per cent THM (up from 7.2% in 2017 Ore Reserve);
Zircon content increased to 27.5 per cent in the THM (up from 22.7%);
In-situ zircon grade in the ore increased to 2.4 per cent (up from 1.6%).

Higher THM ore grade and much higher in-situ zircon grades in the Ore Reserve provides for increased total HMC production for 2020, 2021 and 2022.

Total forecast production for the three calendar years ended 31 December 2022 is now estimated at 830,000 tonnes HMC compared to the 2017 Bankable Feasibility Study updated in July 2018, of 740,000 tonnes HMC over the same period.

“The increase in ore grade, and in particular the significantly higher in-situ zircon grade from the new Ore Reserve reaffirms Boonanarring as one of the highest grade, zircon-rich mineral sand projects in Australia,” Mutz said.

“While the reduction in ore tonnes is disappointing, the improved project economics due to higher overall ore grades and the elimination of marginal ore will almost certainly provide a net positive result for shareholders.

“We are also confident in our ability to add mine life through a robust and systematic exploration program which is already showing great promise on multiple fronts around Boonanarring due to the very high prospectivity of the area.”


Directors: Robert Besley, Patrick Mutz, George Sakalidis, Chong Veoy (Aaron) Soo, Peter Thomas, Chaodian Chen, Fei (Eddy) Wu, Huang Cheng Li