Image Resources (ASX: IMA) is the largest Heavy Minerals tenement holder in the North Perth Basin, Western Australia.
Image is exploring for heavy mineral sands in an area extending more than 160 km from north of the existing TiWest Cooljarloo mine to south of Gingin on the Swan Coastal Plain. Projects include the Cooljarloo North, Cooljarloo, Bidaminna, Bootine, Cataby West, and Quinns Hill as well as Wannamal, Gingin, and McKinley.
Image Resources strikes best heavy minerals intercept yet at Red Gully
Image Resources (ASX: IMA) has returned the best intersection yet from the Red Gully deposit, with 17 metres at 12.7% heavy minerals, confirming the high grade core at the project.
All results from Iluka’s drilling program have now been returned, including highlights of:
- 17 metres at 12.7% heavy minerals from 10 metres, including 13 metres at 15.4% heavy minerals;
- 18 metres at 9.6% heavy minerals from 9 metres, including 14 metres at 11.2% heavy minerals; and
- 9 metres at 16.1% heavy minerals from 14 metres, including 7 metres at 19.8% heavy minerals.
The drilling program was designed to infill and confirm the JORC Resource identified in drilling by previous owner Iluka Resources (ASX: ILU).
Based on Iluka’s work, Red Gully hosts an Indicated Resource of 2.6 million tonnes at 7.5% heavy minerals, in the northern half of the deposit, and an Inferred Resource of 3.4 million tonnes at 7.8% heavy minerals in the southern half.
This equates to a combined 6 million tonnes at 7.7% heavy minerals for 459,000 tonnes of contained heavy minerals.
Results from Image’s drilling program generally corresponded well with the previous results, presenting only minor variations.
Zircon content has been estimated at between 1% and 40% of heavy minerals based on visual examination of drill samples, which correlates well with the 12.4% zircon identified in the current resource.
Image will conduct assemblage studies in coming months to confirm the zircon content at Red Gully, which will be followed by an update to the Indicated Resource estimate.
A detailed magnetic survey has been completed over the Inferred Resource, with infill drilling planned to upgrade the resource to the higher confidence Indicated category.
Stretching over 8 kilometres of strike, Red Gully is one of Image’s longest heavy mineral deposits.
The Red Gully deposit is part of Image’s North Perth Basin Project in Western Australia, where mining studies are being undertaken for a Feasibility Study. Results from work at Red Gully will add confidence to these studies.
North Perth Basin progress
The North Perth Basin comprises 11 JORC Resources, for a total Resource of 7.9 million tonnes of Heavy Minerals, with just six of these Resources included in the Feasibility Study.
A recent Scoping Study at North Perth Basin indicates potential for a 3.6 million tonne per annum multi-pit operation over an initial 12 year mine life.
“The numbers are quite robust in terms of early payback and good internal rate of returns and good cash flow,” managing director George Sakalidis told Proactive Investors.
Capital costs have been estimated at $84 million, with an internal rate of return of between 32.1% and 42.9%.
Sakalidis said the company is looking to pay back the project capital quickly after entering production.
“At this stage it’s 2014 to be in production, we think the commodity prices will still be strong, and we will pay back our plant in 13 months, which is quite an early payback.”
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