IMAGE RESOURCES NL — Capital/Financing Update 2007

Jan 16, 2007

ASX Release 17 January 2007 ASX code: IMA

2^nd 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

IMAGE TRIPLES ITS NORTH PERTH BASIN HOLDINGS TO COVER NEW MESOZOIC TARGETS

Following its successful heavy mineral (HM) exploration at Cooliarloo, Image has extended the scope of its exploration targets to the older basement Mesozoic sediments east of the Gingin Scarp. The thick channel-style mineralisation discovered at Cooliarloo is interpreted to occur within these older sediments beneath the shallow younger Pleistocene sediments which have been the subject of most of the HM exploration in the North Perth Basin to date.

Image has applied for three large tenements totalling 1100sg km effectively tripling its land position in the North Perth Basin to 1660sq km, as shown in the attached map, becoming a dominant land holder in the region. The most northern tenement, E70/3092 Cowalla, which extends from just 15km east of the Cooljarloo tenement, contains a prominent interpreted shoreline feature in excess of 40km in length with potential for concentration and exposure of channel-style mineral sands, particularly on the southern end where a number of drainages transect it.

The central tenement, E70/3100 Quinns Hill, covers several interpreted shoreline features totalling over 70km in length, which are parallel to and east of the Gingin Scarp which hosts the major Eneabba, Cooljarloo, Cataby and Gingin HM deposits.

The eastern tenement, E70/3093 Wannamal, covers an interpreted shoreline feature in excess of 30km paralleling the Darling Scarp and adjacent to the ex-BHP Mindarra HM resource that, significantly, occurs within Mesozoic sediments.

Using the experience gained at Cooliarloo, Image plans to carry out reconnaissance ground magnetic surveys in an attempt to identify channel and potential strand-like features within the Mesozoic tenements in the near future and to follow up significant targets with aircore drilling.

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

Please direct enquiries to: Roger Thomson Managing Director Phone (08) 9485 2410 Mob 0419 969 183

George Sakalidis Executive Director - Exploration Phone (08) 9485 2410 Mob 0411 640 337

The information in this report is based on information compiled by George Sakalidis BSc (Hons), who is a member of the Australasian Institute of Mining and Metallurgy. George Sakalidis is an employee of Image Resources NL. George Sakalidis has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. George Sakalidis consents to the inclusion of this information in the form and context in which it appears in this report.

Image Tenements in the North Perth Basin