IMAGE RESOURCES NL — Capital/Financing Update 2012

Jul 30, 2012

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Level 2, 16 Ord 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

ASX Code: IMA

31 July 2012

BOONANARRING EXPANDS & CAPITAL RAISING

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Drilling of the Northern Section of the 12 km-long Boonanarring Project has now been completed; see Figure 1. Laboratory results from this drilling have just been received and now are being collated. When these results have been compiled it is expected that a further JORC Indicated Resource will be added to Image’s increasing inventory at Boonanarring. Preliminary assessment of these results suggests that the mineralisation is of similar grade, assemblage and depth as that seen in the defined resource within Mining Lease 70/1994 shown in Figure 1.

In addition, immediately to the south, Image has commenced drilling the area the subject of the recently announced option to purchase. Importantly, visual estimates from this partially completed drilling programme indicate that the geophysical interpretation of high grade mineralisation, already confirmed to the north, extends over the strike length of the area drilled so far; for at least 1.2km. Drilling over the remainder (a further 1.8km) of the interpreted strike within the option area is continuing. It is anticipated that the current drilling programme, planned for completion this quarter, will significantly upgrade and increase the size of the Boonanarring resources.

Further, feasibility study work continues focusing on seasonally dependent environmental and hydrological studies and other activities that are time critical to the targeted mine start-up date, including collection of samples for bulk sample testing and drilling at the initial mining target, the high grade Boonanarring heavy mineral deposit, with the aim of significantly expanding the resources.

The recent technical studies have shown that, solely on an operating cost margin basis, Atlas is still a more attractive target than Boonanarring based on average grade.

However, overall Boonanarring offers a quicker and lower risk route to production – and provides short payback even on average grades. If the expected higher grades in the sections currently being drilled are confirmed, then this approach will be reinforced.

The Company’s aim will be to then bring Atlas on line as a parallel mine and wet plant as soon as possible, in order to further improve the overall project economics.

Drilling recently completed at the southern extension of the Atlas resource, which remains another high priority for Image, appears likely to extend the length of that resource by at least 700m. Results from this drilling are being collated.

Image has raised $1,891,012 for general working capital by issuing shares at 30 cents each to a combination of sophisticated and professional investors. The last trade on 5 July 2012 was at $0.30. Following the placement Image has 106,485,193 fully paid shares on issue. The raising of funds at the last market price ($0.30) is considered to be a very positive outcome in the current market. Image is seeking to divest its non-core mineral assets, including its gold tenements in the Erayinia area, in order to focus on its core North Perth Basin mineral sand project.

Given market sentiment, the Company is maintaining an ever vigilant watch on its expenditure and programmes whilst examining numerous financing options to underpin completion of the feasibility study and, as targeted, to deliver first production in 2014.

The information in this report that is related to the NPB Project technical studies and project development is based on information compiled or reviewed by Peter Davies BSc Eng (Hons) ARSM, C.Eng. MIMMM, FAusIMM FRSA, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Peter Davies is Managing Director of Image Resources NL. Peter Davies 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’. Peter Davies consents to the inclusion of this information in the form and context in which it appears in this report.

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

Please direct enquiries to: Peter Davies George Sakalidis Managing Director Executive Director - Exploration Phone: (08) 9485 2410 Phone: (08) 9485 2410 Mob: 0409 296 676 Mob: 0411 640 337

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Figure 1 Boonanarring Resource Areas and Drilling