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Image Resources bags 'strong' BFS for Boonanarring, Atlas; secures off-take deal

Image Resources NL's bankable feasibility study for the wholly owned Boonanarring and Atlas mineral sands deposits, which are part of the company's North Perth Basin property in Western Australia, returned "strong" results, the company said May 30.

The study estimates a posttax net present value of A$100 million, a 54% posttax internal rate of return, and a 22-month payback period.

The total development capital for the project is estimated at A$52 million, which includes about A$8 million attributable to land purchases. Operating costs are estimated at A$489 million, of which A$336 million are dedicated to Boonanarring.

Revenue from the project is estimated at A$793 million, including A$553 million from Boonanarring and A$240 million from Atlas.

The bankable feasibility study is based on current ore reserves at Boonanarring and Atlas with a combined mine life of over eight years and the potential for extension from a confirmed 5.6-kilometer area of high-grade mineralization to the north of Boonanarring.

In a separate, same-day release, Image updated the ore reserves at the Atlas deposit to 9.5 million tonnes, compared with the previously estimated 9.6 million tonnes, at 8.1% heavy minerals.

Image expects to secure complete funding for the project during the third quarter and processing of ore to start in March 2018.

Separately, the company has secured an off-take agreement for 100% of the heavy mineral concentrate to be produced from the project with Chinese processing company Shantou Natfort Zirconium and Titanium Co. Ltd. Image said the deal secures 100% of the revenue for the project.

A previously signed zircon off-take agreement will be placed in indefinite suspension, and Natfort will sell the zircon produced from Image's concentrate to Guangdong Orient Zirconic Ind Sci & Tech Co. Ltd.