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IMAGE RESOURCES NL Capital/Financing Update 2011

Sep 26, 2011

65117_rns_2011-09-26_4c155d77-1892-440f-8669-ff33264f7679.pdf

Capital/Financing Update

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2nd Floor, 16 Ord Street West Perth WA 6005 PO Box 644 West Perth WA 6872 Telephone 08 9485 2410 Facsimile 08 9485 2840 [email protected] www.imageres.com.au

ABN 57 063 977 579

ASX Release 27 September 2011

ASX code: IMA

Gingin South Infill Confirms High Grade Deposit

______________

HIGHLIGHTS

  • Consistently high grade intersections confirmed by 100m spaced infill drilling.

  • Best intersection of 10m at 18.0%HM from 18m at 2.5% HM cut-off, including 6m @ 25.4% HM (10% HM cut-off).

  • Most of the 5.5km long deposit now drilled at 20m x 100m line spacing, allowing estimation of a Measured Resource once mineralogy determinations are complete.

Introduction

In March 2011 Image completed infill drilling of its Gingin South deposit to 20m x 100m hole spacing over a strike length of 4.0km, as shown on Figure 1. All laboratory processing results have now been completed for this drilling and Image is preparing samples for mineralogical analysis. In July 2011 Image released an interim resource extension for the Gingin South deposit, resulting in a 240% increase in contained HM to 492,000t (ASX release 21 July 2011). The receipt of the new results and mineralogical data will allow the update of the Indicated part of this resource to Measured status. When compared to the previous drilling the new results confirm the high grade nature and extent of the deposit.

HM Grade Results

The best results are summarised in Table 1 and all intersections of 3m or greater thickness at a 2.5% HM cut-off are detailed in Table 2. The list of intersections shows the deposit to be quite robust with a maximum average slimes content of 12.5% and only 9 intersections averaging greater than 10% slimes. This suggests that slimes will not present a significant processing issue for this deposit.

Typical sections are shown in Figures 2 to 5 illustrating the high grade nature of the deposit. These sections also show that the mineralisation occurs on two levels, the western strand at ~ 58m RL and the eastern strand at ~70m RL. The eastern strand appears to merge with the western strand in the central area and then separate further north.

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Table 1

Best Intersections using 10% HM cut-off

Hole
Number
East North From
(m)
To
(m)
Interval
(m)
HM
(%)
GG609 399422 6521897 20.0 31.0 11.0 15.3
including 23.0 29.0 6.0 23.4
GG611 399383 6521900 17.0 29.0 12.0 13.4
including 22.0 29.0 7.0 18.9
GG612 399364 6521902 18.0 29.0 11.0 11.1
including 21.0 26.0 5.0 17.0
GG624 399145 6522096 25.0 32.0 7.0 10.9
including 27.0 30.0 3.0 18.2
GG625 399163 6522093 17.0 27 10 16.5
including 19.0 24.0 5.0 24.2
GG626 399182 6522092 17.0 26.0 9.0 10.9
including 19.0 23.0 4.0 17.2
GG633 399278 6522102 19.0 33.0 14.0 13.2
including 23.0 30.0 7.0 21.1
GG634 399260 6522103 17.0 28.0 11.0 16.6
including 21.0 27.0 6.0 25.4
GG635 399241 6522098 17.0 28.0 11.0 17.1
including 19.0 27.0 8.0 20.9
GG636 399219 6522103 17.0 27.0 10.0 14.3
including 18.0 25.0 7.0 17.7

Future Work

The next step in the assessment of the Gingin South deposit is to composite the mineral intersections for mineralogical analysis and then refine the geological model in preparation for a new resource estimate, upgrading the status of most of the deposit to the Measured category. Drilling is also scheduled to infill the Inferred section of the resource to at least 20m x 200m hole spacing to upgrade this section to Indicated status. This drilling will commence mid to late October when a drill rig becomes available.

The Gingin South deposit was one of the six resources included in the Scoping Study, the results of which were announced 25 August 2011 and is now part of the Feasibility Study. It was scheduled towards the end of the mine sequence for the Scoping Study, but in light of the high grade nature of the deposit its sequencing will be re-examined in the Feasibility Study to determine if earlier exploitation will improve project economics.

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 is based on information compiled by Paul Leandri BAppSc who is a member of the Australasian Institute of Mining and Metallurgy. Paul Leandri is an employee of Image Resources NL. He 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’. Paul Leandri consents to the inclusion of this information in the form and context in which it appears in this report.

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==> picture [392 x 582] intentionally omitted <==

Figure 1 Gingin South Deposit Drill Hole and Section Location

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==> picture [693 x 288] intentionally omitted <==

Figure 2 HM Cross-section line 6 521 900m N

4

==> picture [691 x 263] intentionally omitted <==

Figure 3 HM Cross-section line 6 522 100m N

5

==> picture [694 x 290] intentionally omitted <==

Figure 4 HM Cross-section line 6 522 300m N

6

==> picture [693 x 299] intentionally omitted <==

Figure 5 HM Cross-section line 6 522 900m N

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Table 2 List of all intersections >=3m thick at 2.5 % HM cut-off.

Hole ID Easting Northing From
(m)
To
(m)
Interval
(m)
HM
(%)
Slimes
(%)
GG601 399452 6521700 22.0 25.0 3.0 4.5 11.6
GG607 399441 6521899 21.0 30.0 9.0 4.5 4.8
GG609 399422 6521897 20.0 31.0 11.0 15.3 6.4
GG611 399383 6521900 17.0 29.0 12.0 13.4 8.2
GG612 399364 6521902 18.0 29.0 11.0 11.1 6.9
GG613 399344 6521901 18.0 27.0 9.0 8.0 3.5
GG614 399325 6521899 19.0 25.0 6.0 4.6 2.5
GG615 399305 6521899 21.0 24.0 3.0 5.5 5.6
GG618 399251 6521904 20.0 24.0 4.0 3.8 11.0
GG618 399251 6521904 26.0 29.0 3.0 11.1 6.1
GG619 399224 6521903 29.0 32.0 3.0 4.1 10.2
GG622 399128 6522101 16.0 20.0 4.0 6.8 7.3
GG623 399111 6522101 27.0 30.0 3.0 3.4 12.5
GG624 399145 6522096 16.0 22.0 6.0 7.7 7.3
GG624 399145 6522096 25.0 32.0 7.0 10.9 9.4
GG625 399163 6522093 17.0 27.0 10.0 16.5 9.7
GG626 399182 6522092 17.0 26.0 9.0 10.9 8.7
GG632 399296 6522102 24.0 32.0 8.0 8.4 3.7
GG633 399278 6522102 19.0 33.0 14.0 13.2 6.2
GG634 399260 6522103 17.0 28.0 11.0 16.6 6.8
GG635 399241 6522098 17.0 28.0 11.0 17.1 5.9
GG636 399219 6522103 17.0 27.0 10.0 14.3 6.4
GG637 399200 6522101 17.0 26.0 9.0 12.7 7.7
GG638 399148 6522304 20.0 24.0 4.0 6.1 2.3
GG639 399129 6522302 17.0 23.0 6.0 10.4 2.2
GG640 399113 6522301 14.0 22.0 8.0 9.0 2.0
GG641 399093 6522303 15.0 21.0 6.0 10.7 2.2
GG642 399075 6522302 14.0 22.0 8.0 8.0 3.3
GG643 399057 6522304 15.0 22.0 7.0 8.1 3.7
GG644 399039 6522303 15.0 29.0 14 6.8 6.1
GG645 399021 6522301 23.0 28.0 5.0 5.8 7.3
GG648 398911 6522507 22.0 25.0 3.0 4.9 9.0
GG649 398929 6522501 22.0 27.0 5.0 6.7 8.5
GG650 398948 6522504 14.0 24.0 10.0 6.6 10.6
GG656 398846 6522699 10.0 23.0 13.0 6.6 6.1
GG658 398828 6522700 18.0 26.0 8.0 6.1 7.7
GG659 398810 6522700 22.0 26.0 4.0 4.0 9.1
GG662 398793 6522912 14.0 17.0 3.0 3.5 3.4
GG663 398775 6522910 10.0 17.0 7.0 4.7 2.4
GG664 398756 6522907 10.0 17.0 7.0 5.2 2.4
GG665 398737 6522903 12.0 28.0 16.0 7.9 5.4
GG666 398716 6522902 25.0 29.0 4.0 6.5 5.9
GG669 398761 6523100 22.0 25.0 3.0 3.6 3.5

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Hole ID Easting Northing From
(m)
To
(m)
Interval
(m)
HM
(%)
Slimes
(%)
GG670 398741 6523096 21.0 25.0 4.0 5.7 4.8
GG672 398703 6523102 21.0 25.0 4.0 4.3 6.6
GG673 398686 6523101 20.0 25.0 5.0 5.3 9.4
GG674 398663 6523097 19.0 24.0 5.0 5.1 10.1
GG675 398643 6523103 19.0 31.0 12.0 6.3 10.5
GG676 398626 6523103 26.0 31.0 5.0 6.2 7.9
GG679 398572 6523437 16.0 19.0 3.0 3.5 6.9
GG680 398553 6523436 14.0 17.0 3.0 4.1 11.1
GG683 397753 6525102 6.0 11.0 5.0 4.5 5.4
GG684 397733 6525102 4.0 10.0 6.0 4.2 4.3
GG685 397717 6525111 3.0 11.0 8.0 4.3 5.1
GG686 397699 6525114 3.0 9.0 6.0 3.8 3.5
GG687 397682 6525107 3.0 9.0 6.0 4.2 3.0
GG687 397682 6525107 11.0 16.0 5.0 14.7 4.5
GG689 397646 6525099 16.0 19.0 3.0 3.8 8.0
GG699 397789 6524913 3.0 10.0 7.0 4.2 4.0
GG700 397773 6524905 5.0 9.0 4.0 3.4 4.2
GG700 397773 6524905 13.0 17.0 4.0 11.3 9.4
GG701 397756 6524898 18.0 22.0 4.0 6.7 4.6
GG702 397737 6524900 18.0 22.0 4.0 3.7 6.6
GG707 397924 6524679 3.0 9.0 6.0 5.0 8.3
GG708 397946 6524665 2.0 9.0 7.0 4.6 10.7
GG709 397909 6524688 2.0 10.0 8.0 4.5 6.9
GG710 397892 6524699 1.0 9.0 8.0 4.1 6.9
GG711 397877 6524708 3.0 13.0 10.0 8.4 8.6
GG712 397862 6524718 2.0 9.0 7.0 4.7 5.6
GG712 397862 6524718 14.0 17.0 3.0 16.8 9.2
GG713 397842 6524703 16.0 19.0 3.0 5.7 4.4

Notes:

  1. Slimes = fraction < 63um

  2. HM determined by TBE separation at 2.96 SG and expressed as % of total (inground) sample.

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