Mineral sands sales boost Image coffers by $22m

Image Resources is cashed-up and charging towards the next phase of its life as a mining company after today pocketing $22 million from the final shipment of mineral sands from its Boonanarring project in Western Australia.

The company says its coffers have now been boosted to about $50 million and it is preparing to use the funds on a basket of highly-prospective projects it has on its hands.

Image’s latest windfall comes from its sale of the final bulk shipment of heavy mineral concentrate (HMC) from Boonanarring. Mining and processing at the project were completed in August, before the loading of the final shipment of about 27,700 wet metric tonnes of HMC.

Boonanarring was a successful project by virtually any measure.

Beginning in 2018, it ramped to nameplate capacity in just its second month of operation and was profitable in its first year. It then completed more than four years of continuous operations, including repaying its debt early in 2021.

The company also paid dividends in 2021 and again last year and produced about 1.15 million tonnes of HMC containing around 320,000 tonnes of zircon.

Image Resources managing director and chief executive officer Patrick Mutz said: “Over the five-year mine life, the project produced 1.17 million tonnes of HMC and generated almost A$800 million in gross revenues. Cash from the project was also used to substantially expand Image’s mineral sands project portfolio with the acquisitions of the Eneabba Tenements and McCalls Project in 2022.”

The company previously set out a two-chapter philosophy to cover its planned mining activities.

Chapter one was to focus on its transition from explorer to being an active miner, based on a philosophy of one mine, one product and one customer. Image will now focus on its Atlas project as the final stage of chapter one, which will come to an end with the completion of mining at Atlas.

The project is a high-grade mineral sands mine containing 5.5 million tonnes of ore reserves at 9.2 per cent total heavy minerals (HM) and 96 per cent contained HM in the proven category. The mineralisation is shallow and has an excellent strip ratio of about 1:1.

Image is now waiting on permitting for the project and all HMC will be sold under the existing offtake agreements used at Boonanarring, with letters of credit supporting each bulk shipment prior to loading. It is fully prepared and now extremely well-funded to relocate its mining and processing equipment to Atlas as soon as the permitting is finalised.

The one mine, one product and one customer model proved successful, but was not considered sustainable long-term. So, Image’s chapter two philosophy is to operate multiple mines simultaneously and produce multiple products to be marketed globally, in addition to investigating value-adding through the conversion of ilmenite to synthetic rutile.

Management’s plan is to use experience gained in recent years to continue its trajectory as an established and growing mining company.

The chapter two ambitions have become possible through two highly-strategic acquisitions of mineral sands projects in WA last year. The company’s purchase of a basket of Eneabba tenements, in addition to its existing portfolio of ground, added about 200 million tonnes of mineral resources and increased the dry mining portfolio threefold.

Additionally, purchasing the McCalls project added 5.8 billion tonnes of mineral resources and increased the total a further tenfold.

Image has the cash to progress its multitude of projects and with the success of Boonanarring now behind it, it has every reason to feel pretty good about itself.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au