IMAGE RESOURCES NL — Capital/Financing Update 2008

May 7, 2008

ASX Release ASX code: IMA 8 May 2008

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2nd 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

MAIDEN RESOURCE OF

6.4 MILLION TONNES OF HEAVY MINERALS

HIGHLIGHTS

• Indicated and Inferred Resources in an initial 7 deposits total 260Mt @ 2.4%HM (heavy minerals), containing 6.4Mt of HM.

• The resources defined so far contain a total of:

• 340,000 tonnes of leucoxene and rutile

• 4,500,000 tonnes of ilmenite

• 545,000 tonnes of zircon

• 390,000 tonnes of garnet

• A high valuable heavy mineral content of 87%.

• The resources outlined to date are contained within 60km of ground magnetic targets, comprising only 20% of the 300km of magnetic targets defined so far. The remaining 247 km of targets have yet to be drilled and some 68% of the project area remains to be surveyed, indicating a high probability of further significant discoveries increasing the resource base.

• 25% of the contained heavy minerals occur in shallow high grade deposits amenable to dry mining with the balance occurring in deeper, lower grade deposits which appear to be suitable for low cost dredging.

• Most of the ilmenite is the high Ti variety and likely to be suitable for chloride-route processing and synthetic rutile production.

• The heavy mineral assemblage is low in radioactive minerals and well below normal transport limits.

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RESOURCE SUMMARY

The initial global heavy mineral resource estimate for Image Resources’ North Perth Basin project currently stand at 260 million tonnes @ 2.4% HM containing 6.4 million tonnes of heavy minerals. The resources comprise Indicated and Inferred Resources (JORC standard), which are divided into two groups as shown in Table 1: those shallow deposits amenable to dry mining and those more suited to dredging. Heavy mineral dredging operations typically apply a cut off grade of less than 1% HM, reflecting the bulk mining and lower unit operating costs compared to dry mining. The estimates use a 1% HM cut off grade for the dredge resources and a 2.5% HM cut off for the shallow (dry mining) resources. Figure 1 shows the location of the resources identified to date.

Table 1 North Perth Basin Resource Summary – May 2008

	Shallow Indicated Resources - 2.5% HM Cut off
Resource	Tonnes	% HM	HM Tonnes	Overburden Ratio
Atlas	1,900,000	4.7	90,000	3.4
Telesto	1,900,000	5.8	110,000	0.6
Helene	11,500,000	4.5	520,000	2.2
Hyperion	3,700,000	7.8	290,000	1.5
Sub - Total	19,000,000	5.3	1,010,000
	Shallow Inferred Resources - 2.5% HM Cut off
Atlas	9,700,000	5.8	560,000	3.4
Total Dry	28,700,000	5.5	1,570,000
	Dredge Indicated Resources - 1% HM Cut off
Titan	21,200,000	1.8	380,000	1.2
	Dredge Inferred Resources - 1% HM Cut off
Bidaminna	44,600,000	3.0	1,350,000	1.5
Titan	115,400,000	1.9	2,210,000	1.0
Calypso	51,500,000	1.7	850,000	1.2
Sub - Total	211,500,000	2.1	4,410,000
**Total Dredge **	232,700,000	2.1	4,790,000
Grand Total	261,400,000	2.4	6,360,000

The resource estimates (except for the historical Bidaminna resources) are based on air core drilling carried out by Image Resources plus historical air core drilling using a 1m or 2m sample interval with processing of samples at Western Geolabs in Perth using a heavy liquid separation method to produce a heavy mineral concentrate. Indicated Resources were estimated using drill spacing in the range from 10m x 100m up to 60m x 200m. Inferred Resources were estimated using drill spacing in the range from 20m x

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200m up to 80m x 800m. Block models of the resources were constructed using an inverse distance squared method of grade interpolation. In total, Image processed 29,949 samples and utilized results from approximately 18,000 historical samples to define the resources.

Overall, the defined resources contain a total of:

340,000 tonnes of leucoxene and rutile 4,500,000 tonnes of ilmenite 545,000 tonnes of zircon 390,000 tonnes of garnet.

Expected overburden ratios (the ratio of overburden to mineralisation) for the deposits identified to date are summarised in Table 1 and are based on the block models.

Table 2 summarises the mineral assemblages (determined by optical or XRF methods) of the various resources identified to date.

Table 2 North Perth Basin Mineral Assemblages

	Shallow Indicated Resources - 2.5% HM Cut off
Resource	Ilmenite t	Leucoxene/ Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
Atlas	63,000	10,000	8,000	300	5,000	11,000
Telesto	71,800	800	6,000	10,000	2,500	15,100
Helene	391,000	19,000	55,000	1,500	7,800	53,000
Hyperion	155,200	18,000	21,000	800	67,000	28,600
Sub - Total	681,000	47,800	90,000	12,600	82,300	107,700
	Shallow Inferred Resources - 2.5% HM Cut off
Atlas	346,000	61000	46000	1900	33000	70,000
Total Shallow	1,027,000	108,800	136,000	14,500	115,300	177,700
	Dredge Indicated Resources - 1% HM Cut off
Titan	273,000	12,000	36,000	7,400	28,000	17,200
	Dredge Inferred Resources - 1% HM Cut off
Bidaminna	1,113,000	110,000	73,000	1,400	19,000	17,200
Titan	1,626,000	67,000	210,000	44,000	160,000	103,000
Calypso	598,000	44,000	90,000	16,000	70,000	31,000
Sub - Total	3,337,000	221,000	373,000	61,400	249,000	151,200
**Total Dredge **	3,610,000	233,000	409,000	68,800	277,000	168,400
Grand Total	4,637,000	341,800	545,000	83,300	392,300	346,100

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Figure 1 North Perth Basin Project Resource Locations

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Most of the ilmenite appears to be suitable for chloride route processing and synthetic rutile production (precise amounts yet to be determined).

U308 and ThO2 levels aggregate to less than 175 ppm in composite heavy mineral samples produced from the drilling completed to date, well within normal limits for transport of heavy mineral concentrates.

Image holds (or is entitled to hold) granted exploration licences over all the resources with the exception of part of the Bidaminna resource which is held under exploration licence application. Access and compensation agreements have been signed on the Hyperion and Helene deposits. The Atlas and Bidaminna resources occur on crown land or vacant crown land and are subject to normal environmental permitting for uncleared bush. Parts of Telesto, Titan and Calypso have yet to have access and compensation agreements finalised.

Image is now preparing to undertake a scoping study to analyse the likely feasibility and potential mining options for the mineral resources defined so far. It is anticipated that further drilling will be carried out to advance the Inferred Resources to indicated or measured status.

RESOURCE ESTIMATES

Data collection, collation, validation and geological interpretation were performed by Image Resources. Consultants performed wire framing and grade interpolation (inverse distance squared) with interpolation parameters determined by the consultants in conjunction with Image.

COOLJARLOO NORTH

The Cooljarloo North project area comprises the following tenements.

Table 3 Cooljarloo North Tenement Summary

Tenement	Status	Holder	Image Interest	Area Ha
E70/2892	Granted	Image Resources NL	100%	2,665
E70/3328	Application	Image Resources NL	100%	296
P70/1540	Application	Image Resources NL	100%	20
P70/1541	Application	Image Resources NL	100%	20

Resource estimates for two deposits at Cooljarloo North have been completed at Hyperion and Helene. Tenement details are summarised in Table 3. Land access and compensation agreements have been signed with all of the landowners involved.

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Figure 2 Cooljarloo North Project Area Showing Hyperion and Helene Deposits

Hyperion

The location of this strandline deposit is shown in Figure 2. Resource estimates at varying cut off grades are shown in Table 4. The relationship between cut off grade and contained heavy minerals is shown in Figure 3. A striking feature of this deposit is that it is high grade and very shallow with an overburden ratio of 1.5 (at 2.5% HM cut off). The deposit contains a lower garnet-rich horizon. The contained mineral assemblage tonnages at various grades are shown in Table 5, based on optical point counts of composite samples performed by Diamantina Laboratories in Perth.

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Table 4 Hyperion Indicated Resource Summary

Cut off %HM	Volume cu.m	Tonnes	HM %	Slimes %	HM Tonnes
10	310,000	700,000	22.8	18.3	160,000
5	650,000	1,400,000	14.9	18.5	210,000
4	900,000	1,900,000	12.1	19.0	230,000
3	1,400,000	2,900,000	9.0	19.3	260,000
2.5	1,800,000	3,700,000	7.7	19.3	290,000
2	2,400,000	5,000,000	6.3	19.0	310,000
1	6,000,000	11,900,000	3.4	16.8	410,000

Table 5 Hyperion Heavy Mineral Assemblages (Optical Method*)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
10	70,000	8,700	9,900	500	51,000	13,600
5	100,000	12,000	13,000	600	60,000	20,000
4	110,000	14,000	15,000	600	62,000	23,000
3	130,000	16,000	19,000	700	65,000	26,000
2.5	160,000	18,000	21,000	800	67,000	29,000
2	170,000	20,000	24,000	800	68,000	32,000
1	230,000	28,000	35,000	1,400	73,000	41,000

*Tables summarising mineral assemblages determined by optical methods include primary and secondary ilmenite, which command similar prices and have similar markets. Optical methods comprise modal analyses by optical point counts.

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Figure 3 Hyperion Cut off Grade-Tonnage Curve

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Figure 4 Helene Cut off Grade – Tonnage Curve

Helene

The location of this strandline deposit is shown in Figure 2. Indicated Resource estimates at varying cut off grades are shown in Table 6 and Figure 4. The deposit is interpreted to comprise 4 major strandlines that are present over most of the 4 km strike length and 3 minor strands that are less continuous. The strandlines are generally shallow with an overall overburden ratio of 2.2 at a 2.5% HM cut off. The contained mineral assemblage tonnages at various grades are shown in Table 7.

Table 6 Helene Indicated Resource Summary

Cut off %HM	Volume cu.m	Tonnes	HM %	Slimes %	HM Tonnes
10	170,000	370,000	12.5	19.0	50,000
5	1,450,000	3,000,000	7.3	18.5	220,000
4	2,700,000	5,500,000	6.0	18.4	330,000
3	4,600,000	9,500,000	4.9	18.5	470,000
2.5	5,600,000	11,500,000	4.6	18.6	520,000
2	6,400,000	13,200,000	4.3	18.6	560,000
1	7,200,000	14,900,000	4.0	18.6	590,000

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Table 7

Helene Heavy Mineral Assemblages (Optical Method)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
10	30,000	1,400	5,300	100	700	3,300
5	170,000	7,500	24,000	500	3,300	19,000
4	240,000	12,000	35,000	800	4,900	31,000
3	350,000	17,000	49,000	1,300	7,000	46,000
2.5	390,000	19,000	55,000	1,500	7,800	53,000
2	410,000	21,000	59,000	1,600	8,400	57,000
1	430,000	22,000	62,000	1,700	8,800	60,000

COOLJARLOO JV

Image Resources holds a 70% interest in this contributing joint venture with Metal Sands Pty Ltd. The tenement details are summarised in Table 8.

Table 8 Cooljarloo JV Tenement Summary

Tenement	Status	Holder	Image Interest	Area (Ha)
E70/2636	Granted	Metal Sands PtyLtd	70%	5,120
E70/2898	Granted	Metal Sands PtyLtd	70%	2,422
P70/1502	Granted	Metal Sands PtyLtd	70%	153
P70/1516	Granted	Metal Sands PtyLtd	70%	41
P70/1520	Application	Metal Sands PtyLtd	70%	134
P70/1521	Application	Metal Sands PtyLtd	70%	141

Access and compensation agreements are in place for on freehold lots 2495, 3859, 3861, 3961 and 4246. Access and compensation agreements have yet to be finalised on lots 3838, 3860, 3862, 3806 and 3863.

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Figure 5 Cooljarloo JV showing Resource Areas

Atlas (formerly 35 AHD)

The location of this resource is shown in Figure 5. Atlas contains high grades typical of strandline deposits, and is relatively shallow with an overburden ratio of 3.4 at a 2.5% HM cut off. Image Resources’ drilling comprises about 55% of the drilling completed to date on this resource, with the balance being made up of historical drilling. Indicated and Inferred Resource estimates at various cut off grades are shown in Tables 9 and 10 respectively, with the total indicated plus Inferred Resource shown in Table 11 and Figure 6.

Table 9 Atlas Indicated Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
10	60,000	120,000	12.5	19.0	20,000
5	300,000	600,000	7.2	18.5	50,000
4	500,000	900,000	6.0	18.4	60,000
3	700,000	1,400,000	4.9	18.5	80,000
2.5	1,000,000	1,900,000	4.9	13.5	90,000
2	1,400,000	2,700,000	4.2	18.5	110,000
1	2,800,000	5,400,000	3.9	18.5	150,000

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Table 10 Atlas Inferred Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
10	670,000	1,370,000	12.5	19.0	190,000
5	1,900,000	3,900,000	7.2	18.5	360,000
4	2,700,000	5,400,000	6.0	18.4	430,000
3	3,800,000	7,500,000	4.9	18.5	500,000
2.5	4,900,000	9,700,000	5.8	13.8	560,000
2	6,000,000	11,700,000	4.2	18.5	610,000
1	9,900,000	19,300,000	3.9	18.5	720,000

Table 11 Atlas Indicated + Inferred Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
10	730,000	1,500,000	12.5	19.0	210,000
5	2,300,000	4,500,000	7.2	18.5	410,000
4	3,200,000	6,300,000	6.0	18.4	490,000
3	4,600,000	9,000,000	4.9	18.5	580,000
2.5	5,900,000	11,600,000	5.7	13.7	660,000
2	7,300,000	14,400,000	4.2	18.5	720,000
1	12,800,000	24,700,000	3.9	18.5	870,000

The contained mineral assemblage tonnages at various cut off grades are shown in Table 12.

Table 12

Atlas Heavy Mineral Assemblages – Total (Optical Method)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
10	120,000	21,000	16,000	600	11,000	24,100
5	230,000	39,000	30,000	1,200	21,000	45,000
4	270,000	46,000	35,000	1,400	25,000	53,000
3	310,000	54,000	42,000	1,700	29,000	63,000
2.5	350,000	61,000	46,000	1,900	33,000	70,000
2	380,000	65,000	50,000	2,000	35,000	75,000
1	450,000	78,000	59,000	2,400	42,000	90,000

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Figure 6 Atlas Cut off Grade – Tonnage Curves

Telesto (formerly 28000 Strand)

Telesto consists of two sub-parallel strandlines separated by about 100m apart as shown in Figure 5. The easternmost is the older, richer and larger of the two. Both are very shallow with overburden ratios of less than one and frequently outcropping. The Indicated Resources at various cut off grades are shown in Table 13. The contained mineral assemblage tonnages at various grades are shown in Table 14.

Table 13

Telesto Indicated Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
5.0	360,000	760,000	8.8	18.9	67,000
4.0	520,000	1,100,000	7.5	18.8	81,000
3.5	610,000	1,300,000	7.0	18.8	89,000
3.0	740,000	1,500,000	6.3	18.7	97,000
2.5	910,000	1,900,000	5.7	18.6	110,000
2.0	1,100,000	2,300,000	5.0	18.3	120,000
1.5	1,400,000	2,900,000	4.3	18.4	130,000
1.0	1,700,000	3,500,000	3.8	18.4	130,000
0.5	2,000,000	4,000,000	3.4	18.7	140,000

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Table 14 Telesto Heavy Mineral Assemblages (XRF Method*)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
5.0	45,000	3,900	6,600	1,200	8,100	200
4.0	55,000	4,700	8,000	1,400	9,900	200
3.5	60,000	5,100	8,600	1,500	11,000	300
3.0	66,000	5,500	9,400	1,700	12,000	300
2.5	73,000	6,000	10,000	1,800	13,000	300
2.0	80,000	6,600	11,000	2,000	14,000	300
1.5	87,000	7,100	12,000	2,200	16,000	400
1.0	92,000	7,500	13,000	2,300	17,000	400
0.5	94,000	7,600	13,000	2,300	17,000	400

• XRF methods comprise calculation of mineral assemblages based on XRF analyses

Titan (formerly Mid-Level Strand)

This extensive mineralisation zone averages 7m in thickness, 930m in width and 8.2km in length and is shown in Figure 5. The Indicated and Inferred Resources at various cut off grades are shown in Tables 15 and 16 respectively, with the total Indicated plus Inferred Resources shown in Table 17. At a 1% cut off the overburden ratio is a low 1.1. The contained mineral assemblage tonnages at various cut off grades are shown in Table 18. Additional mineralisation has been intersected by wide-spaced drilling in the central part of the resource but has not been included in the resource estimate at this stage. There is some evidence from the drilling that channel style mineralisation may occur below the Titan resource, warranting further drilling.

Table 15 Titan Indicated Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
5.00	90,000	190,000	6.3	27.5	10,000
4.00	200,000	430,000	4.9	24.8	20,000
3.50	400,000	740,000	4.2	22.3	30,000
3.00	700,000	1,390,000	3.7	21.0	60,000
2.50	1,400,000	2,900,000	3.2	20.7	100,000
2.00	2,800,000	5,800,000	2.8	19.8	160,000
1.50	5,500,000	11,400,000	2.3	18.8	260,000
1.00	10,300,000	21,200,000	1.9	19.4	380,000
0.90	11,500,000	23,500,000	1.8	19.6	400,000
0.80	12,800,000	26,100,000	1.7	19.8	420,000
0.70	14,100,000	28,900,000	1.7	20.0	440,000
0.60	15,600,000	32,000,000	1.6	20.2	460,000
0.50	17,000,000	35,000,000	1.5	20.3	480,000

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Table 16 Titan Inferred Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
5.00	260,000	530,000	6.1	23.8	30,000
4.00	1,200,000	2,360,000	4.8	22.8	110,000
3.50	2,700,000	5,380,000	4.2	20.8	230,000
3.00	5,800,000	11,560,000	3.7	19.8	420,000
2.50	10,800,000	21,700,000	3.2	19.8	700,000
2.00	19,900,000	39,600,000	2.8	19.0	1,100,000
1.50	37,500,000	73,900,000	2.3	18.1	1,690,000
1.00	58,500,000	115,400,000	1.9	18.9	2,210,000
0.90	63,100,000	124,700,000	1.8	19.1	2,300,000
0.80	68,200,000	134,900,000	1.8	19.3	2,380,000
0.70	74,400,000	147,200,000	1.7	19.5	2,480,000
0.60	81,900,000	162,100,000	1.6	19.7	2,570,000
0.50	90,000,000	179,000,000	1.5	19.9	2,660,000

Table 17 Titan Indicated + Inferred Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
5.00	350,000	720,000	6.3	27.5	50,000
4.00	1,400,000	2,790,000	4.9	24.8	140,000
3.50	3,000,000	6,120,000	4.2	22.3	260,000
3.00	6,400,000	12,940,000	3.7	21.0	480,000
2.50	12,200,000	24,600,000	3.2	20.7	800,000
2.00	22,700,000	45,300,000	2.8	19.8	1,260,000
1.50	43,100,000	85,300,000	2.3	18.8	1,950,000
1.00	68,900,000	136,600,000	1.9	19.4	2,590,000
0.90	74,600,000	148,200,000	1.8	19.6	2,700,000
0.80	81,000,000	161,000,000	1.7	19.8	2,810,000
0.70	88,500,000	176,100,000	1.7	20.0	2,920,000
0.60	97,500,000	194,100,000	1.6	20.2	3,040,000
0.50	107,000,000	214,000,000	1.5	20.3	3,150,000

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Table 18

Titan Indicated + Inferred Heavy Mineral Assemblages (XRF Method)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
5.00	10,000	400	1,200	200	900	400
4.00	20,000	800	2,200	400	1,600	1,000
3.50	30,000	1,100	3,300	700	2,500	1,000
3.00	40,000	1,800	5,200	1,100	4,000	2,000
2.50	70,000	3,100	9,200	1,900	7,100	3,000
2.00	120,000	5,100	15,000	3,100	12,000	6,000
1.50	190,000	8,000	24,000	5,000	19,000	9,000
1.00	270,000	12,000	36,000	7,400	28,000	13,000
0.90	290,000	12,000	38,000	7,800	30,000	14,000
0.80	310,000	13,000	40,000	8,300	31,000	15,000
0.70	330,000	14,000	42,000	8,700	33,000	16,000
0.60	340,000	14,000	44,000	9,100	34,000	16,000
0.50	360,000	15,000	46,000	9,500	36,000	17,000

Calypso (formerly Channel Mineralisation)

The Calypso mineralisation shown in Figure 5 is interpreted to be of fluvial origin. It is hosted in Mesozoic sediments, and appears to be facies controlled. The sediments hosting the mineralisation are typically a very clean fine to medium sand up to 70m in depth. They are bounded by clay-rich sediment barren of heavy minerals. The sands are interpreted to be braided streams and the clays thought to represent quiet swamp environs. There are clay intercalations within the sands. Inferred Resource at various cut off grades are shown in Table 19 with Table 20 summarising the mineral assemblage tonnages at various cut off grades. At a 1% cut off the overburden ratio is 1.2.

Table 19

Calypso Inferred Resource Summary

Cut off %HM	Volume cu.m	Tonnes	%HM	Slimes %	HM Tonnes
5.00	50,000	100,000	6.0	12.6	10,000
4.00	200,000	370,000	4.8	13.3	20,000
3.50	400,000	780,000	4.2	13.0	30,000
3.00	1,000,000	1,830,000	3.6	12.6	70,000
2.50	2,400,000	4,600,000	3.1	12.3	140,000
2.00	5,800,000	10,900,000	2.6	12.3	280,000
1.50	13,700,000	26,000,000	2.1	13.2	540,000
1.00	27,100,000	51,500,000	1.7	13.7	850,000
0.90	30,600,000	58,100,000	1.6	13.8	920,000
0.80	34,600,000	65,800,000	1.5	13.8	980,000
0.70	39,100,000	74,300,000	1.4	14.0	1,040,000
0.60	44,400,000	84,500,000	1.3	14.1	1,110,000
0.50	51,000,000	97,000,000	1.2	14.3	1,180,000

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Table 20

Calypso Inferred Heavy Mineral Assemblages (XRF Method)

Cut off %HM	Ilmenite t	Leucoxene + Rutile t	Zircon t	Monazite t	Garnet + Staurolite t	Other t
5.00	4,200	300	600	100	500	100
4.00	13,000	900	2,000	300	1,500	400
3.50	23,000	1,700	4,000	600	2,800	700
3.00	46,000	3,400	7,000	1,300	5,700	1,500
2.50	99,000	7,000	15,000	2,700	12,000	3,100
2.00	200,000	14,000	30,000	5,300	24,000	6,100
1.50	380,000	28,000	60,000	10,000	50,000	12,000
1.00	600,000	44,000	90,000	16,000	70,000	18,000
0.90	640,000	47,000	100,000	17,000	80,000	20,000
0.80	680,000	50,000	110,000	18,000	90,000	21,000
0.70	720,000	54,000	110,000	20,000	90,000	22,000
0.60	780,000	57,000	120,000	21,000	100,000	24,000
0.50	820,000	61,000	130,000	22,000	100,000	25,000

BIDAMINNA

The Bidaminna deposit lies within granted exploration licence E70/2844 and application E70/3298. Four parcels of land cover the deposit, three of which form part of the Nabaroo pastoral lease. The fourth parcel is crown land designated to be a stock route. Native vegetation covers the whole of the deposit. All of the exploration was conducted by Geopeko in the early 1990’s, and the resource estimate quoted is that estimated by Geopeko in 1992. The resource methodology has been reviewed by Image Resources and found to be sufficiently sound to be classified as an Inferred Resource as shown in Table 21. The resource is subdivided into three geological zones. The lowest zone, Yoganup, is thought to correspond to the Yoganup Formation and is a continuous sheet of mineralised silty sand that underlies the strandline mineralisation within high and low grade zones. The low grade zone forms a halo around the high grade zone. The sediments within them are described as fine to medium grained quartz sand (Rothnie, 1992). At a 1% cut off the overburden ratio is 1.5.

Table 21 Bidaminna Inferred Resource Summary

Zone	Volume cu.m	Tonnes	HM %	Slimes %	HM Tonnes
Lowgrade	10,000,000	17,000,000	1.5	3.9	260,000
Highgrade	6,500,000	11,000,000	4.1	3.7	460,000
Yoganup	9,800,000	16,600,000	3.8	3.1	630,000
Total	26,300,000	44,600,000	3.0	3.6	1,350,000

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Geopeko undertook modal analyses of the heavy mineral suite on 11 composite samples as summarised in Table 22.

Table 22

Bidaminna Heavy Mineral Assemblages (Optical Method)

Zone	Ilmenite t	Leucoxene/ Rutile t	Zircon t	Monazite t	Garnet t	Other t
Lowgrade	213,000	25,000	13,000	100	200	5,100
highgrade	385,000	42,000	23,000	200	400	9,000
Yoganup	515,000	44,000	38,000	1,100	18,000	15,100
Total	1,113,000	110,000	73,000	1,400	19,000	27,200

ADDITIONAL INFORMATION

Image Resources holds 27 exploration tenements on which it is targeting heavy minerals in the North Perth Basin (8 granted tenements and 19 applications) totalling 2090sq km.

Heavy mineral sands are mineral particles that are 1.3 to 2 times heavier than quartz sand. Valuable heavy minerals include ilmenite, leucoxene, rutile (known as titanium minerals), zircon and, to a lesser extent, garnet. The titanium minerals all contain titanium dioxide ( TiO2 ), the most important uses being in the production of pigments, titanium metal and welding rod flux. Historically, demand for titanium minerals has grown in line with world GDP growth. Zircon is zirconium silicate and is used mainly in the ceramics, refractory and specialty glass industries. Ilmenite gradually oxidises becoming enriched in TiO2. Secondary (altered) ilmenite, HiTi ilmenite and leucoxene are various stages in this process. Rutile and primary ilmenite are not alteration products and are generally formed in igneous rocks and subsequently liberated by erosion.

Heavy minerals are denser than normal sand and may be sorted and concentrated by the actions of waves and water current flow. The most efficient means of formation of a heavy mineral deposit is by the action of waves on a beach. Most of the world’s economic deposits were formed in this way but a few were deposited in river systems. The deposits identified by Image in the North Perth Basin are considered to include both these types of deposits.

The two most common methods of mining heavy minerals are dredging and dry mining (earthmoving by truck and excavator or elevating scraper). Dredging is more suited to large deposits that lie below the water table. Dry mining while more expensive in terms of unit operating cost, offers more flexibility with regard to mining and suits smaller, shallow or clay rich deposits. Clay (or slime) content is an important economic factor affecting mineral recoveries and requiring construction of tailings storage areas. Image’s resources are considered to contain acceptable slime content. Heavy mineral grain size is another factor affecting mineral recoveries. The heavy mineral grain size range from Image’s resources appears to be typical of the North Perth Basin and is expected to facilitate good processing plant recoveries. Some of the deposits contain pyrite which can form acid requiring neutralisation, however the pyrite levels encountered to date are similar to those in operating mines in the region.

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Heavy mineral products are commonly quoted in US$. Two types of processes are used to treat ilmenite: the sulphate process and the chloride process. Only ilmenite of higher Ti02 content is suitable for the chloride process and this ilmenite commands a higher price. Estimates of current heavy mineral commodity prices are shown in Table 23.

Table 23 Commodity Prices

Product	US$/tonne
Ilmenite – Chloride	100
Ilmenite – Sulphate	90
Leucoxene	450
Rutile	450
Zircon	750
Garnet	70

Bibliography

Rothnie, Colin, 1992. Cataby J.V. E70/489 & E70/791 Annual Report Nabaroo and Bidaminna, North Perth Basin May 1991 – April 1992. Open file company report a36673.pdf available from Dept. Industry and Resources.

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

Please direct enquiries to: George Sakalidis Roger Thomson Managing Director Executive Director Phone (08) 9485 2410 Phone (08) 9485 2410 Mob 0411 640 337 Mob 0419 969 183

The information in this report that relates to exploration results is based on information compiled by Scott Carruthers BSc,MSc. Scott Carruthers is a full time employee of Image Resources NL. The information in this report that relates to mineral resources is based on information compiled by Lynn Widenbar BSc, MSc, DIC MAusIMM employed by Widenbar & Associates who are consultants to the Company. Messrs Carruthers and Widenbar have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Persons as defined in the 2004 edition of the ‘Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Messrs Carruthers and Widenbar consent to the inclusion of this information in the form and context in which it appears in this report.

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