IMAGE RESOURCES NL — Capital/Financing Update 2005

Jul 4, 2005

ASX Release 5 July 2005

ASX code: IMA

^¤ Floor, 35 Outram St West Perth WA 6005 PO Box 644 West Perth WA 6872 Telephone 08 9485 2410 Facsimile 08 9485 2840 info@imageres.com.au www.imageres.com.au

ABN 57 063 977 579

NEW JOINT VENTURE WITH MITHRIL RESOURCES

IN ZIRCON-RICH EUCLA BASIN

Image Resources is pleased to announce a new joint venture with Mithril Resources Ltd exploring for mineral sands on Mithril's Barton Project. The Barton Joint Venture area (ELA 2004/265) is situated 50 kilometres to the northeast of the recently discovered zircon-rich Jacinth and Ambrosia Iluka deposits.

The joint venture covers 992 square kilometres of the Barton Range Shoreline, an older coastal barrier than that hosting Jacinth, which is situated on the Ooldea Range Shoreline. PIRSA's drilling (1993) demonstrated the mineral sands potential of the Barton Range Shoreline identifying a heavy mineral concentrate comprised of 56% altered ilmenite, 17% zircon, 15% leucoxene, and 3% rutile (based on visual estimation for the -1 mm +38µm fraction) from a down hole depth of 16-22 metres in hole LBR17 which is located in the joint venture area.

Image is required to spend \$300,000 within three years to earn a 51% interest in the joint venture and may elect to increase its interest to 70% through an additional expenditure of \$200,000. Mithril was successful in its application for funding to assist with mineral sands exploration from the state government's PACE initiative regarding collaborative drilling programs. As the application is within the Maralinga Tiarutia Lands, exploration will commence on finalising heritage and land access agreements.

Image now has a large tenement holding of 2966 sq km in the zircon-rich Eucla Basin (see attached map). In the area around the existing heavy mineral intersection Image plans to use the magnetic mapping technique developed by Image director George Sakalidis. This technique delineates buried mineral sands and successfully led to a high success rate in preferentially outlining and drilling the high-grade portions of the heavy mineral strands at Dongara resulting in a low cost per resource tonne delineated. Ultimately a resource of 180 Mt of 5% heavy minerals was identified by Image's subsidiary Magnetic Minerals Ltd, which was subsequently taken over by Ticor Ltd in early 2003 resulting in substantial rewards to Image and Magnetic shareholders and to Image itself.

Image Resources' Eucla Basin Tenements

For more information on the company visit www.imageres.com.au

Please direct enquiries to: Roger Thomson Managing Director Phone (08) 9485 2410 Mob 0419969183

George Sakalidis Executive Director - Exploration Phone (08) 9485 2410 Mob 0411640337

The information on mineralisation contained in this report accurately reflects the information compiled by Mr George Sakalidis B.Sc. Hons., MAusIMM, who is a competent person (as defined by the Australasian Code of Reporting of Identified Mineral Resources and Ore Reserves) with relevant experience in relation to such mineralisation.