Image Resourcescould produce up to 89,000 tpa ilmenite,
5,400 tpa leucoxene, 9,000 tpa rutile and 32,400 tpa zircon
years from its Atlas and Boonanarring deposits in the
Perth Basin, Western Australia.
The project will
use conventional dry
open pit mining techniques and wet concentration for a total
operating cost of Australian dollar (A) $655m ($605.8m*), according to its
recently released feasibility study.
feasibility study has established a strong basis for Image to
secure offtake partners and funding for the projects,
said Peter Davies, managing director of
The mining would
begin at the Boonanarring deposit and move to Atlas in 2021,
which would require a three-month transfer period.
indicated that 40% of the
ilmenite from Boonanarring and 100% of the ilmenite from
Atlas is suitable for synthetic rutile production or chloride
The balance is
suitable for slag furnace or sulphate-route pigment plant
zircon grades, especially at Boonanarring, the project is
expected to be more robust than almost all other undeveloped
mineral sands projects in a low zircon pricing
environment, the company said.
produced at Atlas is expected to be high quality, while
opportunity exists at Boonanarring to enhance project economics
by upgrading the zircon produced from that deposit.
To reach the 2015
deadline, Image outlined, the company hopes to obtain approvals
to commence work on site in July 2014.
In order to
be ready to start site construction at that time, detailed
engineering will need to commence in February 2014, in turn
requiring project finance arrangements and key land access
agreements to be in place by that time, the company
opportunity to commence options studies in September 2013 and
if required, to complete a final bankable feasibility study in
January 2014, it added.
The schedule that
the company has set allows from now until January 2014 to
complete fund raising and arrange offtakes
For fund raising,
the study has shown that the
project will have a maximum negative cashflow of A$64.1m in
the Q2 2015, which allows for all project expenditures and
analysis has been carried out of project financing options but
the company has received expressions of interest for offtake
agreements, equity investment and build-own-transfer lease
focus for now will be to secure finance to expedite the
project, said Davies.
analysis for the project has given it a payback period of 22
months, a pre-tax net present value (NPV) of A$145m (at 8%), a
pre-tax internal rate of return (IRR) of 57.4% and operating
cashflow after capital and after tax of A$185m.
These figures were
all determined using long-term product prices of $400/tonne for
leucoxene and $1,500/tonne for rutile across both
differed slightly and were estimated at $260/tonne for the
Boonanarring deposit and at $272/tonne for the Atlas deposit,
where mining will move to in 2021.
For zircon, prices
were estimated at $1,250/tonne for the Boonanarring deposit and
at $1,410/tonne for the Atlas deposit.
These prices are
slightly higher than current prices (see the IM prices
* Conversion made