Image Resources has targeted a mid-2025 start to heavy mineral concentrate production at its Atlas project, 170km north of Perth, after securing essential water licences to accelerate construction. The milestone has now offered a clear timeline for renewed cash flows - expected to be $62m pre-tax over two years - almost two years after shutting down the successful Boonanarring project, located 100km south of Atlas.
Image Resources now expects a June kick off to start producing the first tonnes of heavy mineral concentrate (HMC) from its wholly-owned Atlas mineral sands project, 170km north of Perth in the North Perth Basin, after receiving the critical 5C water licences needed to fire up development construction work at site.
With a newly accelerated timeline locked in, the company is finally able put a firm date on the recommencement of serious cash inflows again after the taps were turned off almost two years ago with the decommissioning of its highly successful Boonanarring project, 100km to the south of Atlas.
The mine is regarded as more of an extension of Boonanarring in that the HMC will be sold as a continuation of existing offtake agreements and will fill the production gap prior to the development of much bigger deposits in the works including Yandanooka and Bidaminna.
The deposit is highlighted by the shallow high-grade nature of the mineral sands with an excellent 1:1 strip ratio. Hosting 5.5 million tonnes of ore reserves at 9.2 per cent total heavy minerals (THM), 11.9 per cent of the mineralised sands are made up of zircon and 7.9 per cent rutile, while 61 percent is made up of titanium dioxide in ilmenite.
With a planned mine life of two years, the project is expected to process 2.6 million tonnes per annum (tpa) for a total of 446,000pa of HMC, generating a pre-tax project cashflow of $62 million.
Infrastructure works such as the mining camp (now completed), access roads and utility connections have been ongoing for two months at the new site, supported by a temporary water abstraction licence but with the final 5C licences now granted, development efforts—including mine dewatering—will move at full pace. The final permitting milestone has also paved the way for relocating the already dismantled wet concentration plant from Boonanarring to site.
Image Resources managing director and chief executive officer Patrick Mutz said: "Although Atlas is still in the early stages of construction, we are already seeing the same high quality project delivery that we achieved with the Boonanarring project in 2018. Our priority remains safety, but we are also looking for opportunities to streamline and shorten a typical six to eight-month construction timeline through efficient planning and execution.”
The accelerated construction of the Atlas project reflects Image’s broader strategic focus on mineral sands, with much bigger plans already in train.
The commissioning of Atlas will only complete what the company has dubbed “chapter one” of its plan to become a multiple mine, multiple product company and ultimately, a producer of synthetic rutile.
Chapter two became closer to reality after the company made two strategic acquisitions in 2022 to buy not only the Eneabba tenements, northeast of Atlas which include the 60 million tonne Yandanooka deposit but also the vast 3.6 billion tonne McCalls project, 30km east of its existing 123 million tonne Bindaminna prospect.
Yandanooka is the next planned cab off the rank. In April, the company revealed a compelling prefeasibility study (PFS) which modelled an 8.2-year mine life producing an average of 130,000tpa of HMC for a life-of-mine EBITDA of $277 million. With a capital pay back period of 15 months, the capital expenditure is expected to peak at $50 million.
With $30 million in the bank and an administrative burn rate of slightly more than $1.7m per quarter after interest received, Image has set itself up well to cover the cost of commissioning Atlas when it comes online in June. But it will be the cashflow from the mine that will contribute the biggest chunk of the Yandanooka capital expense, which itself will provide the funding for Bindaminna and ultimately, McCalls – all of which are within cooee of Atlas.
By securing the green light today from the government to start mine development at Atlas, Image has fired the starting gun on what could be another golden period for the company. With so many irons in the fire, the company hopes to generate sufficient cash to potentially develop into a global player in the mineral sands market in the next few years.
A decent rival for the likes of Illuka would no doubt be welcomed by the market and the next eight months may prove pivotal for Image as it looks to set itself up long into the future.
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