Image Resources has Growth Options in Place

THE CONFERENCE CALLER: Having quickly established itself as Australia’s premier mid-tier heavy minerals (HM) producer, Image Resources (ASX: IMA) is now facing another major challenge – to find further feed for its hungry processing plant. By Mark Fraser

Although the company’s high-grade flagship operation Boonanarring – located just 80 kilometres north of Perth in its home state of Western Australia – has only another two-to-three years’ mine life left in it, Image has enough expansion options up its sleeve to make sure the project remains an ongoing concern.

First cab off the rank is Atlas some 70km to the north, where an already-established resource of 18 million tonnes of ore grading 6 per cent heavy minerals (HM), including a combined 15.8 per cent zircon plus rutile (Z+R), looks set to add another three years of dry mining production.

Following this are the North Perth Basin dry deposits of Red Gully (6Mt at 7.7% HM; 15.5% Z+R), Regans Ford (9.9Mt at 9.6% HM; 14.3% Z+R), Helene/Hyperion (18.2Mt at 4.8% HM; 14% Z+R), Gingin South (8.1Mt at 6.1% HM; 13.5% Z+R) and Gingin North (2.4Mt at 5.5% HM; 9.1% Z+R).

All up this equates to an extra 93 million tonnes at 6.3 per cent HM; 17 per cent Z+R on top of Boonanarring’s current inventory of 30.3Mt at 6 per cent HM; 23.1 per cent Z+R.

Further exploration is expected to boost these figures.

In addition, Image has a number of dredge mining options – including Bidaminna (where the current resource sits at 45Mt at 3% HM and combined 6.5% Z+R), Titan-Telesto (140Mt at 1.9% HM; 12.8% Z+R) and Calypso (51Mt at 1.7% HM; 15.9% Z+R). Together, these add an additional 236Mt at 2.1 per cent HM and 11.5 per cent Z+R to the mining house’s inventory.

During the RIU Resurgence Conference, Image Resources chief financial officer John McEvoy indicated the company was initially looking to move its 3.7 million tonnes per annum Boonanarring wet concentration plant (WCP) to Atlas, where it had another three years of reserves, “with potential for further expansion”.

After that further relocation options included the neighbouring Hyperion and Helene deposits.

“At Boonanarring, as well as the potential to expand reserves to the north and west, there is also the potential to pump or truck ore from Gingin south and Gingin North,” McEvoy noted.

“For Atlas, there is the potential to increase mine life by pumping from the nearby deposits Hyperion and Helene.

“In addition, Red Gully and Regans Ford provide an option for a future WCP location.”

McEvoy added it was possible one of the dredging targets (particularly Bidaminna) could also be an option for a second operating centre.

Thus far this target has some fairly positive attributes – including a 90 per cent-plus HM grade, less than 5 per cent slimes, a 25-67 per cent leucoxene content as well as a 100Mt exploration target.

McIvoy told RIU delegates that while COVID had inflicted a, “limited impact on our operations”, the key issue for the first half of 2020 came from shipping, with China slow to ramp up production post its new year.

Image, he said, shipped 109,000 tonnes during that period.

However, since about May or June, Chinese demand has been increasing and the company remained on track to ship at its target rate of 90-100,000 tonnes in both the third and fourth quarters.

Moreover, this kept Image on track to meet its 2020 sales guidance of 300-330,000 tonnes, “despite the significant challenges thrown at us this year”.

One interesting development at Boonanarring, which looks set to moderately boost Image’s standing (or image) amongst the sustainability crowd, is the recent on-site construction of a 2.3 megawatt solar farm.

McEvoy told RIU delegates the resources house was now expecting to generate power within the next month.

“Whilst not providing a significant cost saving, renewable energy in terms of solar is expected to provide at least 25 per cent of our electricity requirements for the remainder of the mine life,” he said.



Image Resources Hits New Production Records at Boonanarring

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.”





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



Auroch Minerals Drilling at Saints Nickel Project

THE DRILL SERGEANT: Auroch Minerals (ASX: AOU) has an air-core (AC) drilling program underway at the company’s Saints nickel project, located just outside Kalgoorlie in Western Australia.

Image Resources Enhances Ore Reserves Potential at Boonanarring

THE DRILL SERGEANT: Image Resources (ASX: IMA) reported drilling results from a program focused on adding new Ore Reserves at the company’s 100 per cent-owned, high-grade, zircon-rich Boonanarring mineral sands project, located north of Perth in Western Australia.

African Gold Granted West Mali Exploration Permit

THE BOURSE WHISPERER: African Gold (ASX: A1G) has been granted the Yatia-Sud Exploration Permit in the Kenieba region of West Mali.

Musgrave Minerals Resumes Drilling at Break of Day

THE DRILL SERGEANT: Musgrave Minerals (ASX: MGV) is out drilling again at the company’s Cue gold project in the Murchison district of Western Australia.

Image Resources Enhances Ore Reserves Potential at Boonanarring

THE DRILL SERGEANT: Image Resources (ASX: IMA) reported drilling results from a program focused on adding new Ore Reserves at the company’s 100 per cent-owned, high-grade, zircon-rich Boonanarring mineral sands project, located north of Perth in Western Australia.

“The focus of the program is to identify new Mineral Resources and Ore Reserves in the area that is within 10 kilometres from the current location of the Boonanarring wet concentration plant,” Image Resources said in its ASX announcement.

“Specific focus areas include the northern and southern extensions of the current Ore Reserve, as well as adjacent areas to the west associated with a recently announced 50mRL Strandline.”

Image Resources’ latest drilling aimed at extending the mine life at Boonanarring identified two strongly mineralised parallel strands at the Boonanarring Northwestern extension, both of which are 1.2km long.

The company has completed a 108-hole program at the Boonanarring Northwestern Extension (Central Stockcare) and due to the promising shallow results achieved, a further 73 holes are planned.

The two main strands that are each 1.2km in length have been outlined with the western strand producing some excellent intersections, including:

4 metres at 14.5 per cent heavy minerals (HM) from 15m;

3m at 14.3 per cent HM from 17m;

5m at 12.2 per cent HM from 13m;

4m at 10.9 per cent HM from 11m;

2m at 17.1 per cent HM from 16m; and

2m at 23.0 per cent HM from 14m in.

The eastern strand also produced good shallow intersections, including:

4m at 23.8 per cent HM from 10m;

4m at 27.1 per cent HM from 8m;

3m at 14.8 per cent HM from 9m; and

2m at 27.1 per cent HM from 9m.

Image Resources noted the eastern strand has grades similar to the currently mined Boonanarring Eastern strand, which it considers augers well for the follow up drilling program that is to commence soon.








Pantoro Considers Norseman Processing Plant Options Review Outcomes

THE BOURSE WHISPERER: Pantoro Limited (ASX: PNR) has completed a Processing Plant Options Review and Scoping Estimate at the company’s Norseman gold project in Western Australia.

St George Mining Drills Deeper for Thicker Intercepts

THE DRILL SERGEANT: St George Mining (ASX: SGQ) confirmed further extensions of high-grade mineralisation at the company’s Mt Alexander project, located in the north-eastern Goldfields of Western Australia.

Image Resources Secures December Quarter Sales

THE BOURSE WHISPERER: Image Resources (ASX: IMA) has secured sales agreements from off-take partners for the December quarter 2019.

Virgo Resources to IPO With Namibia-Botswana Projects

THE BOURSE WHISPERER: Former Gold Road Resources (ASX: GOR) chairman Ian Murray is about to launch a new company on the boards of the Australian Securities Exchange.


Image Resources Secures December Quarter Sales

THE BOURSE WHISPERER: Image Resources (ASX: IMA) has secured sales agreements from off-take partners for the December quarter 2019.

Image Resources has organised the sale of a nominal total of 65,000 tonnes heavy mineral concentrate (HMC) for the December quarter 2019 with no reduction in zircon pricing.

The HMC will be produced from the company’s 100 per cent-owned, high-grade, zircon-rich Boonanarring mineral sands project located 80 kilometres north of Perth in the North Perth Basin of Western Australia.

The company recently finalised a regular monthly shipment of HMC of nominally 20,000 tonnes, which was purchased by off-taker partner Natfort and sailed at the end of October.

In addition, a sales agreement was secured from off-taker partner Hainan Wensheng for nominally 45,000 tonnes to be delivered over two shipments, one in the latter half of November and the second in December.

Image Resources declared that demand for its HMC remains strong, including from parties other than the current off-take partners.

While the benchmark price for premium grade zircon decreased 2.5 per cent to US$1,580 to 1,590 per tonne in November, Image’s sale price for standard grade zircon contained in the HMC remained unchanged for its scheduled November and December shipments.

Image’s realized price for titanium dioxide (TiO2) contained in the HMC increased approximately six per cent in August and this higher price has continued in the December quarter.

“We continue to receive robust demand for our zircon-rich HMC product,” Image Resources managing director and CEO Patrick Mutz said in the company’s announcement to the Australian Securities Exchange.

“The committed sales of 65,000 tonnes in the December quarter, at stable zircon pricing, keeps the company firmly on track to deliver on our updated CY2019 guidance.”





Image Resources Confirms Continuation of High-Grade Boonanarring Core

THE DRILL SERGEANT: Image Resources (ASX: IMA) declared that close-spaced infill drilling has provided further confirmation of the continuation of the very high-grade core within the eastern strand in Block A of the company’s 100 per cent-owned, high-grade, zircon-rich Boonanarring mineral sands project located north of Perth in the North Perth Basin in Western Australia.

The announcement follows previous releases, including the first in July 2019, of a high-grade core in the eastern strand at Boonanarring from assay results from early stage drilling in Block C (the project’s current mining block) and a second announcement in September of secondary confirmation from assay results from drilling in Block B.

The latest assay results come from the next stage of drilling that was undertaken at Block A, which the company claims to have confirmed the continuation of the high-grade core over the full length (1.4km) of Block A.

The total length of the high-grade core has now been shown to stretch over 5.4 kilometres within Blocks A, B and C, with Block C currently being mined.

Image Resources said these results are part of a larger drilling program designed to re-assess the Mineral Resources and Ore Reserves at Boonanarring.

The full drilling program includes close-spaced, infill drilling to delineate the full extent of the high-grade core in the eastern strand across Blocks A, B, C and D.

Things have been busy at Boonanarring since Image got serious with the project by kicking off the open-cut mine and associated processing facility in April 2018.

The company completed construction and project commissioning ‘on-budget’ and ‘on-schedule’ with production commencing in December 2018.

After just two months of operation production of heavy metal concentrate (HMC) was ramped-up to exceed the long-term steady-state forecast production level of 20,000 tonnes HMC per month.

In March, Image determined the Ore Reserve ore grade had been understated, based on actual mined and processed ore grades and resultant HMC production levels leading the company to realise that the eastern strand of the Boonanarring deposit contains a very high-grade core that was not adequately delineated by the standard drill spacing of 20 metres.

A subsequent close-spaced drilling program (5 metre) commenced in April and continued through July, the results from which will be used to reassess the Mineral Resources and Ore Reserves estimates.

At the end of June 2019, the actual ore grade for the half year was 43 per cent higher than forecast based on the Ore Reserve.

Updated Mineral Resources and Ore Reserves estimates and an update of overall project economics are anticipated to be announced in the October quarter 2019.

Image’s first shipment of HMC product, culminating in its receipt of first revenue, came in January 2019.

Since then, more bulk shipments of HMC of nominally 20,000 tonnes have departed the Bunbury Port at the rate of roughly one per month.

The Boonanarring deposit is rich in zircon,which is one of the most valuable of the four heavy minerals contained in the HMC product.

The company is further encouraged by global zircon production being forecast to be lower than market demand for the next three years, making zircon prices relatively buoyant.

Image sees the combination of these factors to represent more than 80 per cent of its near-term total revenue.

The company is well-placed to take advantage of the upswing with market-based offtake agreements for 100 per cent of production for the life of the mine, with key zircon processing and manufacturing companies in China, which consumes more than half the world’s production of zircon.

Image has now completed two full quarters of active mining and production and at the end of June 2019 is profitable and cashflow positive.

For the first half of 2019 the company reported HMC production at 138 per cent of budget, operating costs of only 76 per cent of budget, EBITDA of 127 per cent of budget and provisional net profit after tax of 157 per cent of budget.

In July the company published updated market guidance and increased its forecast EBITDA from $40 to $50 million to $55 to $65 million for CY2019.

Image is actively drilling to delineate additional Mineral Resources for conversion to Ore Reserves at
Boonanarring with the goal of adding mine life.

Image Resources was eager to point out that Boonanarring is only one of a number of 100 per cent-owned mineral sand deposits in the company’s portfolio in the region, and that it is currently actively exploring and will be looking to develop one or more additional operating centres in the coming years.





AMEC 2019 Convention

THE CONFERENCE CALLER: The Roadhouse attended the 2019 AMEC Convention this week and caught up with the latest goings on for some of our regulars.

Obviously this is a new innovation we are learning to use, so try not to stand too close to the screen when checking out the pics.

Fortunately it is all about listening so sit back and relax and hear what these MDs have to say.


BRUCE MALUISH managing director VRX Silica (ASX: VRX)


MIKE YOUNG managing director Vimy Resources (ASX: VMY)


SEAN GREGORY managing director Barra Resources (ASX: BAR)


PATRICK MUNTZ managing director Image Resources (ASX: IMA)