Image’s unit margins shine on high HM grades

Image Resources has wrapped up its second full quarter as an operational mining company with a bang, thanks to the excellent operational performance of its high-grade, zircon-rich Boonanarring mineral sands project, 80km north of Perth.

Revenues for the quarter ending 30 June 2019 were $42.5 million, or about 85% of the company’s budget, due to weaker than forecast zircon prices.

However, this was more than offset by operating costs that were well under budget at just 78% of its forecasts, or about $22 million, while unit margins were 131% higher than forecast at $294 per dry metric tonne.

Heavy mineral production for the quarter was 117% higher than budgeted at 69,000 tonnes due to the ore grade of 9.3% heavy minerals, or “HM”, well above the expected grade of 7.7% HM.

Additionally, the zircon content of 31.1% of the HM continued to be higher than the estimated 30.8% of the HM in the ore reserve.

This high zircon content is significant to overall project economics as the zircon in the HM represents 88% of the company’s revenues for the June 2019 quarter.

Image has approved capital improvements to its Boonanarring processing plant that are tentatively expected for implementation in the current September quarter.

These include the expansion of the heavy mineral concentrate cleaning and de-watering circuit to accommodate higher ore grades and enhanced oversize screening at the ore feed preparation plant.

Boonanarring has a current global ore reserves of 29.3 million tonnes grading 7.5% HM, though the ongoing work to delineate a previously unnoticed high-grade core of zircon-rich sands within the eastern strand line, could provide a substantial upgrade.

Updated mineral resource and ore reserve estimates are expected later this quarter.