THE BOURSE WHISPERER: Image Resources (ASX: IMA) reported record monthly production from the company’s 100 per cent-owned, high-grade, zircon-rich Boonanarring Mineral Sands project located north of Perth in Western Australia.
Image Resources reported record high monthly production of heavy mineral concentrate (HMC) in December 2019 and again in January 2020.
This was in line with the company’s expectations of higher ore grades that were forecast for mining in Block ‘B’ at Boonanarring.
Prior to December 2019, the highest monthly HMC production Image had achieved was in January 2019 at 25500 tonnes from ore mined in the northern section of Boonanarring Block ‘C’.
Since relocating mining activities from Block ‘C’ to the overall higher-grade Block ‘B’ in mid-November 2019, HMC production for December set a new record high at 31400 tonnes, and in January 2020, HMC production reached a new high at 35300 tonnes, providing a strong start for Q1 and CY2020 production.
The company highlighted that HMC production in December and January was in line with its updated mining model estimates which include the uplift in forecast heavy mineral and zircon grades as reported in the updated Ore Reserve results published in December 2019.
Image expects average monthly HMC production levels to moderate through the year to an average of 25-28kt/month to achieve published market guidance for CY2020 HMC production of 300-330kt.
In January 2020 the sale of a regular monthly scheduled shipment of HMC was completed and discussions are underway with off-take partners for Q1 follow-on shipments.
To date, the only impact to Image from the uncertain economic conditions in China following the emergence of the coronavirus has been a delay of a planned February shipment of HMC into March.
Image is working with its partners to expand the size and/or frequency of HMC shipments going forward, to accommodate the higher 2020 HMC production schedule.
The company is investigating interests in the purchase of its HMC from entities outside of China, as a step to minimise geographical risk and to expand marketing opportunities.
“We continue to meet our production targets at Boonanarring which for 2020 are significantly higher than 2019 targets,” Image Resources managing director and CEO Patrick Mutz said in the company’s announcement to the Australian Securities Exchange.
“Our efforts have been supported by substantially higher HMC production capacity following modifications to the processing plant in 2019.
“These modifications have now been proven to allow HMC production at levels substantially above original plant design capacity.
“We also remain focused on, and confident of the outcome of, accelerating exploration and the development of new Mineral Resources and Ore Reserves under the formal banner of Project ‘MORE’ with the goal of extending the mine-life at Boonanarring as quickly as practicable.
“And, in response to the recent softening of the zircon market, which were largely offset by rising TiO2 prices, we continue to evaluate value-adding steps aimed at incrementally increasing product revenue.”