Image Resources has landed first production of heavy mineral concentrate at its Atlas project, 170 km north of Perth, marking a key step in the company’s plan to expand its mineral sands footprint and achieve planned revenue growth by mid-2025. The mine achieved its first production during early-stage commissioning this month. Despite bushfire evacuations last year, accelerated construction has since kept the project on schedule with initial forecasts.
Image Resources has landed its first production of heavy mineral concentrates (HMC) at the company’s Atlas mineral sands project, 170 kilometres north of Perth, marking a significant step in the company’s strategy to expand its mineral sands footprint and achieve a planned return to revenue growth from mid-2025.
The first HMC production at Atlas was delivered as part of the early-stage commissioning process, which began two weeks ago. Despite delays because of bushfires late last year, the company was able to catch up on construction work through December and January to bring the project in line with earlier timetable forecasts.
With construction nearly complete, the focus has now shifted to ratcheting up processing to get to nameplate capacity, expected by June. Image expects to move its first full HMC shipment in the second quarter of the calendar year, which will kickstart receipt of the project’s long-awaited first revenue.
Image Resources managing director and chief executive officer Patrick Mutz said: “Achieving first production of HMC at Atlas marks a significant milestone for the company, on the heels of the successful construction and early-stage commissioning of our second mineral sands project. Over the next few months, we will focus on ramping up to name plate capacity, and producing a consistent, high-quality HMC product to maximise revenue.”
When the company initially drew up the Atlas processing flowsheet, it decided to use cutting-edge technology, including the first commercial application of Mineral Technologies' CT-1 spiral technology that is designed to concentrate industrial minerals in slurry form.
By integrating the latest feed systems with CT1 compact spirals, Atlas expects to achieve successful mineral separation at feed densities of more than 60 per cent solids and slash its water demand by nearly two-thirds.
According to the makers, the dramatic reduction in water usage minimises the volume sent to tailings dams and significantly cuts power consumption for tailings systems.
Image says the groundbreaking innovation has the potential to revolutionise mine efficiency and sustainability, establishing Atlas as a leader in responsible mineral sands processing.
After nearly two years of negative cashflow following the decommissioning of its highly successful Boonanarring project, Image is likely to be reassured that the Atlas production timeline is now locked-in and a revenue flow is about to re-start.
Apart from an uber-low 1:1 strip ratio, the shallow, high-grade HMC deposit hosts 5.5 million tonnes of ore reserves grading 9.2pc total heavy minerals, including 11.9pc zircon, 7.9pc rutile and an impressive 61pc titanium dioxide in ilmenite.
Atlas is forecast to process 2.6 million tonnes per annum for 446,000tpa of HMC and spit out a pre-tax project cashflow of $62 million over the mine’s two-year life.
Commissioning of the Atlas project, dubbed chapter one, reflects Image’s broader strategic focus on mineral sands. The company already has bigger plans in train including setting up multiple mines, diversifying product lines beyond HMC and accessing a broader global market.
Chapter two moved a step closer in 2022 after the company put its foot on the 60mt Yandanooka HMC deposit and the vast 3.6-billion-tonne McCalls HMC project, 30km east of its existing 123mt Bindaminna prospect.
With these two game-changing tenements in the Eneabba region now under its belt, cashflow from Atlas will be used to start initial groundwork at Yandanooka.
Twelve months ago, Image handed down an eyebrow-raising prefeasibility study for Yandanooka that forecast an 8.2-year mine life to produce 130,000 tonnes per annum of HMC for a life-of-mine EBITDA of $277 million. With a capital payback period of 15 months, the upfront capital expenditure is expected to peak at $50m.
Additionally, in what could be a smart value add for the company’s future production profile, Image is investigating an innovative, lower-emission process for upgrading ilmenite to synthetic rutile, which should be validated by 2026.
Image remains in a strong cash position despite nearly two years of reduced cash flow and having borne the commissioning costs of Atlas, which is now largely completed. With $20m in the bank as at the end of December and a lean corporate burn rate of just over $1.7m per quarter, the company will have excess capital to see it through to the restart of full production in June.
As Atlas shifts gears from construction to full production, Image Resources appears primed for the rising global demand for mineral sands, with prices of ilmenite - the most common type of titanium dioxide - now reaching upwards from US$300 (A$472) per tonne.
With a fresh revenue stream just around the corner, Image is likely to be breathing easier as it looks to turn to chapter two and sets its sights on becoming a key player in the market.
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