Image Resources NL (ASX: IMA) has announced that construction of its Atlas mineral sands project is progressing as planned, with commissioning and initial heavy mineral concentrate (HMC) production expected to commence in Q1 2025.
The project, located 170 kilometres north of Perth in the Dandaragan Shire, has overcome recent challenges and is now fully funded through to its first anticipated revenue in Q2 2025.
Despite a setback caused by a bush fire in late November 2024, which necessitated a brief site evacuation, construction crews quickly resumed work in December.
This rapid progress has reinforced confidence in meeting the original target for early-stage commissioning and initial HMC production before the end of March 2025.
To ensure adequate working capital, Image Resources has initiated a drawdown on a US$20 million HMC Prepayment Facility.
This facility, originally arranged with long-standing HMC offtake partner Shantou Natfort Zirconium and Titanium Co., Ltd. (Natfort), has been partially shared with Billion Sunny Investment Limited to mitigate single-provider funding risks.
The company received US$5 million in late December, with the remaining funds expected in Q1 2025.
Patrick Mutz, Managing Director and CEO of Image Resources, expressed optimism about meeting the Q1 2025 production goal despite earlier permitting delays that postponed construction by over 12 months.
He emphasised that the Prepayment Facility ensures sufficient funding to bridge the gap until Atlas generates its first revenue, anticipated in early Q2 2025.
The Prepayment Facility’s repayment structure involves delivering approximately 25 per cent of each bulk HMC shipment at no cost, while the remaining 75 per cent will be sold at market prices over a 12-month term.
This arrangement, split between Natfort and Sunny Investment, allows for alternating HMC shipments to be processed by nominated mineral separation plants in China.
With US$10 million already received from Sunny Investment on January 7, 2025, and the remaining US$5 million expected from Natfort in Q1 2025, Image Resources appears well-positioned to transition smoothly from construction to production at its Atlas project.
