IMA - Image Resources

[grace]

Okay, this company is now in Fat Prophets best picks for 2008 and also in the AFR top 20 for this year. Cockatoo Coal gets the big move from prophets recommendations.....this one goes down. Trust me to own this one...and bucket loads of them......

 

[Tukker]

One of my favorite shares, I believe Image is one heck of a takeover target, hope they get more than one bidder; crazy not to.

Bought in at 0.55 and believer $3.5 or $4 is very realistic her.

 

[grace]

Did you take up the Emu Nickel priority entitlement to buy shares? I didn't, so just have the bonus ones coming. Saving my money for other things.

 

[jaffa]

Any views on today's announcment. Might be a good pick amongst all the turmoil and while the market is heading over the cliif trying to minimise losses??

Jaffa

 

[grace]

It is getting sold off. The initial jorc is due out soon and it should be between 100 - 200 million tonne at a grade of 10%. This is very high grade and will be a long life mine (cooljarloo and cooljarloo north). Is a takeover target. The price it is going at at the moment is very cheap, but so is everything I guess. The amount of channels they haven't even touched is just amazing. They have the best bit of dirt around for mineral sands in my opinion.

Sorry meant to quote you Jaffa.

 

[grace]

BRR accouncement

http://www.brr.com.au/event/40984

George (MD) has stated that initial JORC for Cooljarloo and Cooljarloo north is VERY CLOSE, and looks VERY GOOD. However, this will not include recent drilling results, and drilling continues, still a lot not drilled!

Also of note is per BRR discussion, this will be a baby compared to other deposits for drilling as follows:-

March/April Bidammina drilling
18km long x 500m wide channel deposits

Another deposit near Diatreme (hoping to line up drilling soon)
28km long x 9km wide with drilling next door by Diatreme with very high grades. This could be massive!

This company could end up being a very large mineral sands producer, as the big thing is the very high grades that George is able to continually find (often no overburden grading up to 50% heavy minerals, possibly about 10% average, but the resource will tell). Iluka recently spruked about a new deposit at 3% HM just to give you a comparison.

One thing to note is that unlike other mines, mineral sands mines are quite quick to get up and going!

Others' comments would be appreciated.

 

[grace]

I would hope that our initial JORC is very very close and should be very good if rumours are anything to go by.. (it's just my opinion, but eventually they will beat Iluka's resources..eventually)

From the Australian

CRITERION hears faint but distinct rumblings on the resources bush telegraph about offshore interest in the West Australian mineral sands explorer involving some serious moolah.

The ambitious minnow (market cap $118 million) has posted upbeat drilling results at its Coljarloo tenements in WA's North Perth Basin, but aspires to win mineral sands dominance from Iluka Resources (market cap $860 million). Given Iluka's woes, maybe it's not such an unrealistic target.

But firstly, Image needs some serious dough from a deep-pocketed backer. Perhaps, just perhaps, the two Singaporean individuals who hold a collective 7-8 per cent of Image are an ideal source of some spare change.

Image chief George Sakalidis yesterday was keeping mum about the rumours, but was happy to discuss the string of Coljarloo results, which point to a world-class deposit.

Image's turf is only a boot's throw from the existing TiWest and Iluka mines. Not for the first time, Image has uncovered stuff on ground formerly owned by the majors, thanks to its customised aeromagnetic techniques. "We've had amazing results in areas where there are supposed to be no resources," Sakalidis says.

Image is spending a couple of hundred grand on 23,000 metres of aircore drilling across 19 targets at Coljarloo, over a strike length of 40km. What investors are really hanging out for is an imminent resources statement that screams: "We are sitting on a humungous deposit."

With 2100km of tenements, Image is the biggest holder in the mineral sands province. The region already supplies 25 per cent of the world's zircon requirements. Iluka is devoting its attention to its Murray basin and Eucla Basin projects.

Image also holds ground at the Eucla Basin, touted by some (but not all) as the future of the mineral sands industry.

Image's share price has been hovering around the $1.50-a-share ($118 million market cap) level, having peaked at $2.37 last July. Image unbundled its nickel interests into Emu Nickel, raising $10million. There are not many positive nickel vibes around, which explains why the 50c shares have tanked to 33.5c

Image's potential has been spruiked for some time, but we'll rate the company a speculative buy on the prospect of a sugar daddy helping Image to recast the sector in its own likeness.

While prices for zircon and titanium have been soaring on the back of unremitting Chinese demand, sentiment towards the sector has suffered because of Iluka's problems and because mineral sands has all the sex appeal of week-old roadkill.

Iluka has posted a dismal half-year result and warned that the appreciating currency would slash full-year earnings from last year's $51 million to $10-20 million. It's also facing rising costs to get its Murray Basin and Eucla Basin projects up and running and has flagged a $350million rights offer.

Criterion last rated Iluka a speculative buy at $4.50 in mid-December, on the grounds that things couldn't get much worse. Guess what? They did. But we'll stick with the speculative buy.

 

[grace]

Rang Image and spoke to Scott Cruthers (George's offsider). Initial jorc for Cooljarloo and Cooljarloo North is planned for the end of March. Personally can hardly wait. It has been a long time coming.
George's view that he didn't want to release jorc and keep upgrading keeps me guessing. Perhaps a strategic move. They are not finished at Cooljarloo yet though. A "world class" deposit in George's words. He keeps buying, although I suspect he won't be in the next couple of weeks re:regulations.

 

[speves]

Hi Grace, if it wasn't for you there would be no posts on this thread....but thanks for your persistence and in keeping us informed. I think that will change as we get closer to the announcement and interest returns.

As a longer term holder I am looking forward finally to the JORC coming out it will be good to see the SP back where it was a years ago....and beyond. I am also hopeful of additional information on plans to get this massive resource to market......then watch things really start to hot up

 

[prawn_86]

So let me get this straight, these guys are a mineral sands explorer due to release a JORC at some stage in the short term.

Their market cap is $100mill approx. Do they have any other projects to justify this MC? Or what is the target of the JORC to be defined? Apart from "world class" which surely isnt quantifiable.

This market is so strange. There are current mineral sands producers with MCs less than what their plant cost to build, and being cashflow positive

 

[grace]

So let me get this straight, these guys are a mineral sands explorer due to release a JORC at some stage in the short term.

Their market cap is $100mill approx. Do they have any other projects to justify this MC? Or what is the target of the JORC to be defined? Apart from "world class" which surely isnt quantifiable.

This market is so strange. There are current mineral sands producers with MCs less than what their plant cost to build, and being cashflow positive

Look back at all of their drilling. They have HM to surface at very high grades. Broker estimate some time back was 100 - 200 mill tonne at 10%. A considerable amount of drilling has been done since. This is on just one deposit, and they still have lots of drilling to go on this deposit, let alone their other deposits. One other deposit is 9km wide x 28km long. That should be a beauty when they finish there.

Some of their drills were up to 60% HM from memory. I believe it is the very high grade that has attracted the MC. But don't worry, it was nearlly $3 last year so it has eased back a tad! The MD George has a knack for finding things under the ground. Found other world class deposits over the years (both mineral sands and nickel) and these have been sold off, taken over. Image also hold royalty type things in other recent spin-offs when/if they mine.

I see you follow Australian Zircon - is that correct? I was looking at it recently too. MC seems very low considering it is up and running.

 

[Tukker]

What a wealth of information you are grace . Have turned off the computer since the credit crunch began for fears of throwing myself off a cliff. Every time i get news from good o'l George i always check it out. George never lets me down, always makes me feel good about the price of the share regardless of its bearish trend.

I love the liquidity of this one, hardly ever over 100,000. Its off the radar for now, a little hidden gem in my portfolio. Sure its down from $2.20 in Nov 2007 to $1.20 in March (this is me not caring) while sellers attempt to fund their other margin positions . Let the markets falter, i see strong support at 1.20 for this baby. Also George's Superfund keeps buying in, supporting the price a bit with relatively small purchases.

If i had more liquidity id be buying bucket loads of this one.

Excited

 

[grace]

What a wealth of information you are grace . Have turned off the computer since the credit crunch began for fears of throwing myself off a cliff. Every time i get news from good o'l George i always check it out. George never lets me down, always makes me feel good about the price of the share regardless of its bearish trend.

I love the liquidity of this one, hardly ever over 100,000. Its off the radar for now, a little hidden gem in my portfolio. Sure its down from $2.20 in Nov 2007 to $1.20 in March (this is me not caring) while sellers attempt to fund their other margin positions . Let the markets falter, i see strong support at 1.20 for this baby. Also George's Superfund keeps buying in, supporting the price a bit with relatively small purchases.

If i had more liquidity id be buying bucket loads of this one.

Excited

Thanks Tukker. I'm about to top up......

They have been busy finding things....all good. Yesterday's announcement about Phosphate sands. They are targeting 3 of the 9 known deposits in the region. Phosphate sands easier to extract than phosphate rock. Interesting times.

Also, another 3 new strands drilled near Cooljarloo.

836 holes for a total of 21,200m have now been drilled at Helene (including historical drilling). Of the 2,806 samples processed so far, 1,297 exceed a cut off of 2% HM (average grade 5.3%) and 126 exceed 10% (average grade 14.5%) with a highest grade of 36.9%. In total, 372 holes have intersections of 2% HM or more.

Resource estimation is being finalised on the Hyperion main strand and the Helene multiple strands at Cooljarloo North together with the 35AHD, 28,000 and Mid Level strands, and the channel mineralisation at Cooljarloo.

We await the initial resource (which won't include recent drilling).

 

[grace]

A little bit more information on the above.

Results from 155 holes totalling 3910m of drilling since November 2007 have increased the cumulative strike length of the three main strands at Target 2 (now renamed Helene) to over 11km. Helene is now recognised to consist of multiple strands over a 4km distance with the three main strands averaging between 50m and 200m in width. Three subsidiary parallel strands have also been outlined (refer to map) making the zone of interest over 900m in width on the edge of the Gingin scarp.

Image Resources’ magnetic mapping technique was instrumental in locating the six strands identified to date at Helene. The northern extension of this wide zone is being followed up with a ground magnetic survey covering new tenement E70/3328 with follow up drilling planned upon completion of permitting.

Significantly, the larger heavy mineral (HM) deposits, including Eneabba, Cataby, Gingin and Reagans Ford,
all occur along the Gingin scarp.

As I've mentioned before, these deposits are only Image's babies compared to drilling to start in a few months.

 

[Tukker]

Any Idea when the JORC report will be ready? Would love some good news that actually stimulated the price right about now.

 

[grace]

Any Idea when the JORC report will be ready? Would love some good news that actually stimulated the price right about now.

Per my previous post, Scott Cruthers advised end of March timetable for release of resource.

You could ring them and see if any delays.

 

[Tukker]

Alright ill do that. Thanks grace. Its a long way to $3. Don't think a good Jorc is gonna bring it to much higher than $2 tbo. See how we go.

 

[grace]

Well, we've hit our bottem and moved up to the first resistance level of $1.50. Next resistance level is $1.75, from what I can make out.

Our initial jorc could be running late, who knows...

Don't mind though if the buying in continues. The move up has been on very low volume similar to the move down.

 

[Crash]

And we have the trading halt. That announcement everyone was waiting for on Wednesday hopefully.

 

[Tukker]

And we have the trading halt. That announcement everyone was waiting for on Wednesday hopefully.

Unfortunately the trading halt is to do with the mess at Opes Prime. I am guessing ANZ wish to sell the shares held as collateral to Opes' debt. Massive selling at very discount prices will take place in the coming days/weeks, many probably off market (i.e. out of the average investor's grasp). Image has requested the halt to negotiate with the bank the manner/timing (my guess) in which ANZ liquidate the shares. An announcement about the result of this will come out before the halt is lifted.

This timing has me a bit perplexed.

If ANZ decide to sell off their image shares when the halt is lifted, then this little gem can be grabbed up for a sweet discount before the Jorc comes out.

However, if they wait for the report to come out to begin selling, then their sales would add more liquidity at current prices thus limiting share growth potential.

If the banks are smart they would wait a couple of days to sell. I don't think they will.

They do not need the price to go up, they would sell and know they have recovered their debt. I've read about them selling other shares at 50% discounts off market already. This is a shame. If they were to sell at fair price they may have some cash left over for the mums and dad's who have fallen victim to Opes Prime's receivership.

With regards to Image's price rise, I'm pleased. I wish there was more depth in the market to offer more of a sustainable growth scenario for the Jorc, but i must again remember image is classed as a high risk investment, even though at this point i do not believe so.

With the sub prime uncertainty going on i can see a few large finance companies gearing up to pump and dump image to make some quick cash to cover margin losses elsewhere. Another unfortunate event potentially hindering share price growth.

Image has been on the ASX for 6 years now, they have done so much. Let me propose a question to the forum.

Do you think George and his team actually intend to set up mining operations of their own, or do you you think they intend to sell the company before?



By the way, these are my humble thoughts, i am no pro.

Tukker