IMAGE RESOURCES NL — Capital/Financing Update 2012

Dec 11, 2012

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ASX Code: IMA 12 December 2012

Image Resources NL Level 2, 16 Ord St West Perth WA 6005 PO Box 644 West Perth WA 6872 Telephone +61 8 9485 2410 Facsimile +61 8 9485 2840 info@imageres.com.au www.imageres.com.au ABN 57 063 977 579

NORTH PERTH BASIN PROJECT FEASIBILITY STUDY FULLY FUNDED

_____________

 $6.7M placement to institutional and sophisticated investors completed.

 Funds to be used to complete the Feasibility study on the North Perth Basin mineral Sands project.

Image Resources NL is pleased to confirm it has completed the capital raising announced to ASX on 6 November 2012, adding $6.7M to Image’s cash balances via the issue 33,500,000 fully paid ordinary shares at 20 cents each.

The funds raised, together with current working capital, exceed the current estimated costs for Image to complete a Bankable Feasibility Study on its Boonanarring and Atlas mineral sands projects in the North Perth Basin. The work is scheduled to be completed in July 2013, including an independent expert review.

The funds raised cover costs related to technical studies, environmental and mining approvals at Boonanarring and augment general working capital. The raising will also fund limited exploration at the Boonanarring project and other high priority project areas.

“With this raising, Image will continue its move to bring the Boonanarring and Atlas deposits into production. We are now focusing on the main feasibility study and associated environmental and approvals work”, said Peter Davies, Managing Director of Image Resources.

Image is pleased to have yet again received strong support from its Singaporean and Malaysian based investors who have been joined by a new group of investors.

Next steps will be completion of the extensions to the current resources at Boonanarring, continuation of process test work and preparation of marketing samples of zircon and ilmenite.”

Image has a 10.5 Mt JORC Measured and Indicated Resource at Boonanarring as part of 52.9 Mt overall in the North Perth Basin (refer Appendix A). Resource upgrades are expected to bring the Boonanarring deposit alone to 15-25 Mt, depending on the cut-off grade used.

By world standards, the Boonanarring project contains a high grade resource, with the majority on cleared freehold farmland. Infrastructure in the area is excellent with the Brand Highway, power and gas lines all crossing the project area. Image’s target is to construct a 3.3 Mt per annum single mine and wet plant operation at Boonanarring with production to commence in late 2014.

Image also holds a number of other tenements in the North Perth Basin which contain major deposits with significant upside potential; these include at Atlas, Red Gully and Gingin South.

Appendix 3B – New Issue Announcement, application for quotation of additional securities and agreement is attached.

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

Please direct enquiries to:

Peter Davies George Sakalidis Managing Director Executive Exploration Director Phone +61 8 9485 2410 Phone +61 8 9485 2410 Mob +61 409 296 676 Mob +61 411 640 337

COMPETENT PERSON’S STATEMENT – EXPLORATION RESULTS

The information in this presentation 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 announcement.

COMPETENT PERSON’S STATEMENT – RESOURCE ESTIMATES

The information in this presentation that relates to mineral resources is based on information compiled by Lynn Widenbar BSc, MSc, DIC, MAIG, MAusIMM employed by Widenbar & Associates who is a consultant to the Company. Lynn Widenbar 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 of Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Lynn Widenbar consents to the inclusion of this information in the form and context in which it appears in this announcement.

COMPETENT PERSON’S STATEMENT – PROJECT EVALUATION

The information in this presentation that relates to project evaluation is based on information compiled 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/Project Manager 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 announcement.

FORWARD LOOKING STATEMENTS

Certain statements made during or in connection with this communication, including, without limitation, those concerning the economic outlook for the mining industry, expectations regarding prices, exploration or development costs and other operating results, growth prospects and the outlook of Image’s operations contain or comprise certain forward looking statements regarding Image’s operations, economic performance and financial condition. Although Image believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct.

Accordingly, results could differ materially from those set out in the forward looking statements as a result of, among other factors, changes in economic and market conditions, success of business and operating initiatives, changes that could result from future acquisitions of new exploration properties, the risks and hazards inherent in the mining business (including industrial accidents, environmental hazards or geologically related conditions), changes in the regulatory environment and other government actions, risks inherent in the ownership, exploration and operation of or investment in mining properties, fluctuations in prices and exchange rates and business and operations risks management, as well as generally those additional factors set forth in our periodic filings with ASX. Image undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after today’s date or to reflect the occurrence of unanticipated events.

Appendix A :: Resource Statement at North Perth Basin Project

High Grade Resources
Resource	Resource	BCM	TONNES	% HM	% SLIMES	HM TONNES	VHM	Ilmenite	Leucoxene	Rutile	Zircon
	Category						(%)	(%)	(%)	(%)	(%)
Atlas	Indicated	520,000	1,080,000	3.2	19.2	34,000	74	53	8	7	6
Atlas	Measured	4,810,000	9,700,000	8.5	15.3	822,000	76	52	5	8	11
Atlas Total		5,330,000	10,780,000	7.9	15.7	856,000	76	52	5	8	10
Boonanaring	Indicated	3,740,000	7,450,000	7.0	14.9	520,000	80	48	11	3	17
Boonanaring	Measured	1,680,000	3,060,000	7.2	9.9	220,000	67	49	1	3	15
Boonanaring
Total		5,420,000	10,510,000	7.1	13.4	740,000	76	48	8	3	17
Gingin Nth	Indicated	680,000	1,320,000	5.7	15.7	75,000	75	57	9	3	5
Gingin Nth	Inferred	580,000	1,090,000	5.2	14	57,000	78	57	11	4	6
Gingin Nth
Total		1,260,000	2,410,000	5.5	15.0	132,000	77	57	10	3	6
Gingin Sth	Indicated	3,240,000	5,820,000	6.5	7.1	377,000	91	68	10	5	8
Gingin Sth	Inferred	400,000	730,000	6.5	8.4	48,000	92	67	8	6	11
Gingin Sth	Measured	870,000	1,530,000	4.4	7.2	67,000	79	51	15	6	8
Gingin Sth
Total		4,510,000	8,080,000	6.1	7.3	492,000	89	65	10	5	8

High Grade Resources
Helene	Indicated	5,600,000	11,500,000	4.6	18.6	523,000	84	70	1	3	11
Hyperion	Indicated	1,800,000	3,700,000	7.8	19.3	290,000	71	56	0	6	9
Red Gully	Indicated	1,930,000	3,410,000	7.8	11.5	267,000	90	66	8	3	12
Red Gully	Inferred	1,455,000	2,570,000	7.5	10.7	192,000	90	66	8	3	12
Red Gully
Total		3,385,000	5,980,000	7.7	11.2	459,000	90	66	8	3	12
Grand Total		27,305,000	52,960,000	6.6	14.3	3,492,000	80.4	58.3	6.0	4.7	11.4

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12

Name of entity

IMAGE RESOURCES NL ABN 57 063 977 579

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of +securities issued or to Ordinary fully paid shares be issued 2 Number of[+] securities issued or a) 29,500,000 to be issued (if known) or b) 4,000,000 maximum number which may c) 1,000 be issued 3 Principal terms of the Fully paid ordinary shares +securities (eg, if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

• See chapter 19 for defined terms.

Appendix 3B Page 1

01/08/2012

Appendix 3B New issue announcement

4 Do the[+] securities rank equally Yes in all respects from the date of allotment with an existing[+] class of quoted[+] securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration $0.20 per share 6 Purpose of the issue a) and b) share placement to (If issued as consideration for sophisticated and professional the acquisition of assets, clearly investors as announced to ASX on 6 identify those assets) November 2012. c) shares to be issued to investors identified by directors under the prospectus dated 6 December 2012. 6a Is the entity an[+] eligible entity Yes that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the[+] securities the subject of this Appendix 3B , and comply with section 6i 6b The date the security holder 30 November 2012 resolution under rule 7.1A was passed 6c Number of +securities issued 8,500,000 without security holder approval under rule 7.1

• See chapter 19 for defined terms.

Appendix 3B Page 2

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Appendix 3B New issue announcement

6d Number of +securities issued with security holder approval under rule 7.1A 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of securities issued under an exception in rule 7.2 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation. 6h If securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 Dates of entering +securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in section 2 if applicable)	0	0
	25,001,000
	0
	N/A
	N/A
	10,284,578
	a) 10 December 2012 b) 20 December 2012 c) 14 January 2013
	Number	+Class
	140,156,193	Ordinary fully paid shares

• See chapter 19 for defined terms.

Appendix 3B Page 3

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Appendix 3B New issue announcement

9 Number and +class of all +securities not quoted on ASX (including the securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	2,345,000 95,000 2,600,000 1,250,000 1,250,000 1,250,000	Options exercisable on or before 18 December 2014 at $1.1162 per option Options exercisable on or before 21 December 2015 at $0.6995 per option Options exercisable on or before 27 December 2016 at $0.3908 per option Options exercisable on or before 1 June 2015 at $0.50 per option Options exercisable on or before 1 June 2016 at $0.70 per option Options exercisable on or before 1 June 2016 at $1.00 per option
	N/A

Part 2 - Bonus issue or pro rata issue

11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the +securities will be offered	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

Appendix 3B Page 4

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Appendix 3B New issue announcement

14 +Class of +securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has +security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of +security holders 25 If the issue is contingent on +security holders’ approval, the date of the meeting	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

Appendix 3B Page 5

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Appendix 3B New issue announcement

26 Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do +security holders sell their entitlements in full through a broker? 31 How do +security holders sell part of their entitlements through a broker and accept for the balance? 32 How do +security holders dispose of their entitlements (except by sale through a broker)? 33 +Despatch date	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of securities ( tick one )

(a) Securities described in Part 1

(b) All other securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

• See chapter 19 for defined terms.

Appendix 3B Page 6

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Appendix 3B New issue announcement

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

• 36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

• 37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

• 38 Number of securities for which N/A +quotation is sought

39 Class of +securities for which N/A quotation is sought

• 40 Do the[+] securities rank equally in N/A all respects from the date of allotment with an existing[+] class of quoted[+] securities?

• If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

• See chapter 19 for defined terms.

Appendix 3B Page 7

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Appendix 3B New issue announcement

41 Reason for request for quotation N/A now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security) Number +Class 42 Number and +class of all N/A N/A +securities quoted on ASX ( including the securities in clause 38)

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those +securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

  • Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• See chapter 19 for defined terms.

Appendix 3B Page 8

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Appendix 3B New issue announcement

• 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

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Sign here:

......................................................... Date: 10 December 2012

• ( ~~Director/~~ Company secretary)

Print name: Dennis Wilkins

• See chapter 19 for defined terms.

Appendix 3B Page 9

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Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for +eligible entities

Introduced 01/08/12

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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Insert number of fully paid ordinary 93,788,959
securities on issue 12 months before date
of issue or agreement to issue
Add the following:
• Number of fully paid ordinary securities 0
issued in that 12 month period under an
exception in rule 7.2
• Number of fully paid ordinary securities 31,563,858
issued in that 12 month period with
shareholder approval
• Number of partly paid ordinary securities 0
that became fully paid in that 12 month
period
Note:
• Include only ordinary securities here –
other classes of equity securities cannot
be added
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
Subtract the number of fully paid ordinary 0
securities cancelled during that 12 month
period
“A” 125,352,817
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• See chapter 19 for defined terms.

Appendix 3B Page 10

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Appendix 3B New issue announcement

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Step 2: Calculate 15% of “A”
“B” 0.15
[Note: this value cannot be changed]
Multiply “A” by 0.15 18,802,923
Step 3: Calculate “C”, the amount of placement capacity under rule
7.1 that has already been used
Insert number of equity securities issued or 14,803,376
agreed to be issued in that 12 month period
not counting those issued:
• Under an exception in rule 7.2
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
Note:
• This applies to equity securities, unless
specifically excluded – not just ordinary
securities
• Include here (if applicable ) the
securities the subject of the Appendix
3B to which this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line itemse items itemstemsmss
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----- Start of picture text -----

Insert number of equity securities issued or 14,803,376
agreed to be issued in that 12 month period
not counting those issued:
• Under an exception in rule 7.2
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
Note:
• This applies to equity securities, unless
specifically excluded – not just ordinary
securities
• Include here (if applicable ) the
securities the subject of the Appendix
3B to which this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line itemse items itemstemsmss
“C” 14,803,376
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Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1

placement capacity under rule 7.1
“A” x 0.15	18,802,923
Note: number must be same as shown in
Step 2
Subtract“C”	14,803,376
Note: number must be same as shown in
Step 3
Total[“A” x 0.15] – “C”	3,999,547
	[Note: this is the remaining placement
	capacity under rule 7.1]

• See chapter 19 for defined terms.

Appendix 3B Page 11

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Appendix 3B New issue announcement

Part 2

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Rule 7.1A – Additional placement capacity for eligible entities
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Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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“A” 125,352,817
Note: number must be same as shown in
Step 1 of Part 1
Step 2: Calculate 10% of “A”
“D” 0.10
Note: this value cannot be changed
Multiply “A” by 0.10 12,535,282
Step 3: Calculate “E”, the amount of placement capacity under rule
7.1A that has already been used
Insert number of equity securities issued or 0
agreed to be issued in that 12 month period
under rule 7.1A
Notes:
• This applies to equity securities – not
just ordinary securities
• Include here – if applicable – the
securities the subject of the Appendix
3B to which this form is annexed
• Do not include equity securities issued
under rule 7.1 (they must be dealt with
in Part 1), or for which specific security
holder approval has been obtained
• It may be useful to set out issues of
securities on different dates as separate
line itemse items itemstemsmss
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----- Start of picture text -----

Insert number of equity securities issued or 0
agreed to be issued in that 12 month period
under rule 7.1A
Notes:
• This applies to equity securities – not
just ordinary securities
• Include here – if applicable – the
securities the subject of the Appendix
3B to which this form is annexed
• Do not include equity securities issued
under rule 7.1 (they must be dealt with
in Part 1), or for which specific security
holder approval has been obtained
• It may be useful to set out issues of
securities on different dates as separate
line itemse items itemstemsmss
“E” 0
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• See chapter 19 for defined terms.

Appendix 3B Page 12

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Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	12,535,282
Subtract“E” Note: number must be same as shown in Step 3	0
Total[“A” x 0.10] – “E”	12,535,282 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

Appendix 3B Page 13

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