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The Mt Woods Project comprises six granted exploration tenements and one mining lease covering an area of 3,290km2, located approximately 700km north-west of Adelaide in South Australia. IMX Resources has been exploring the region since 2000.  The tenements comprise over 50% of the highly prospective Mt Woods Inlier and are immediately north of the tenements containing Prominent Hill, where OZ Minerals Ltd is close to completing their mine development.

Several types of mineralisation have been targeted for exploration:

Magnetite / Magnetite – Copper - Gold: Cairn Hill is the most advanced example of this style of mineralisation, where resources have been defined over a 1.6km strike length in two lodes.  Recent detailed aeromagnetics and sparse historical drilling strongly suggest that the mineralisation appears to be in the form of a recrystallised Banded Iron Formation (BIF) with copper / gold overprinting in parts. The detailed aeromagnetics also indicates possible extensions of the BIF horizons and other potential magnetite targets.

Iron Ore – Copper – Gold (IOCG): Two potential targets of this style of mineralisation have been selected for further investigation, Black Hills and Mt Paisley.  At Mt Paisley there are targets defined by coincident gravity and magnetics features, with similarities to the Olympic Dam geophysical signature, however the targets are relatively deep.

Platinum Group Metals: An initial reconnaissance hole drilled by Anglo American Exploration Australia Pty Ltd on a 20km long gravity feature at Kangaroo Dam intersected increasing PGE at the end of the hole, with the bottom 4 metres assaying 0.3g/t PGE with elevated copper and nickel. Follow-up RC and diamond drilling has confirmed the validity of this target.

Uranium: Permian and Tertiary palaeochannels with the potential for roll front uranium targets have been identified from the detailed gravity coverage and recent drilling.

Kangaroo Dam (PGE)

The Kangaroo Dam prospect is located 25km west-southwest of Cairn Hill (Figure 1). Anomalous palladium and platinum mineralisation was discovered by IMX Resources in a series of limited RC and diamond core drill programs at Kangaroo Dam since 2002. Previously, the best drill intercepts at the prospect include 1.94 g/t Pd+Pt+Au over 2m from 151m (KDRC001) and 0.74 g/t Pd+Pt+Au over 4m from 56m (MWRC012). The holes intersected a sequence of felsic and mafic gneisses with patchy ‘mafic skarn’ alteration and pyrrhotite±PGE mineralisation in magnetite gneiss.

Two RC holes were drilled in 2008 to test the extent of the mineralisation intersected by MWRC012 in 2007. Both holes intersected amphibolite and magnetite gneiss basement with intervals of disseminated sulphides below approximately 55m of cover sediments. Laboratory results are awaited.

Black Hills IOCG Project
The Black Hills IOCG prospect is located approximately 20km south of Cairn Hill and 50km northwest of the Prominent Hill deposit (Figure 1). As reported previously, an anomalous copper-gold zone was discovered during reconnaissance RAB drilling in 2006 and followed-up by three RC holes all of which intersected copper mineralisation and anomalous gold geochemistry, the best result being 1m from 72m @ 1.7% Cu and 0.1g/t Au in amphibolite rock,

In early 2008, two additional RC holes (MWRC017 & 018) were drilled, with both holes confirming the presence of the host amphibolite. Hole MWRC018 intersected two intervals of stringer chalcopyrite (copper sulphide).

The mineralisation appears to dip to the north and RAB geochemistry highlights two NNE and ESE tending lineaments which may reflect fabric and/or structures in the basement rocks. The anomalous copper-gold zone is open to the east and west, is approximately 400m wide and has been traced over 2.6km of strike.

Further RC drilling and an IP geophysics program is being planned for 2008-2009 to help identify zones with disseminated/stringer chalcopyrite mineralisation.

Mt Paisley
The Mt Paisley project is located approximately 150 km east southeast of Coober Pedy and 100km northwest of Olympic (Figure 1). Geophysical modelling, using gravity and magnetics, has identified a number of potential IOCG targets within the licence area. The largest such feature is a high tenor coincident magnetic and gravity feature that had been modelled as an Olympic Dam style target deep in the basement rocks.

In February 2008, a single vertical diamond core hole, MPD001, was drilled to 1,683.7m to test the anomaly. Basement rocks were intersected from a depth of 1288m. Core from the drill hole revealed a 185m thick sequence of dense hematite-rich banded iron formation (BIF) with minor zones of brecciation. Below the BIF unit lies a sedimentary sequence comprising conglomerate, siltstone and black shale. This sequence is intruded by dolerite consisting of quartz-sericite±chlorite with coarse-grained amphibole and magnetite.

The combination of a dense BIF sequence and intrusions of magnetic dolerites has explained the modelled deep, large gravity and magnetic anomaly. Although trace chalcopyrite was present in the BIF and shales, this copper sulphide mineralisation is not considered significant at the depths intersected.

Drill hole MPD001 successfully tested one of several Olympic Dam style target in the area, but intersected only minor mineralisation. Additional coincident magnetic and gravity anomalies exist at shallower depths northeast of MPD001. Further modelling of these geophysical features is planned, as well as downhole geophysical surveys in MPD001

Project will nominally produce 1.7 million tonnes per annum (mtpa) of ore after ramp up.

Jilin Tonghua Iron & Steel (Group) Mining Co Ltd will purchase up to 1.4mtpa of ROM ore on a 3 year contract. Ore will be processed at a purpose built processing plant at Bayuquan in Liaoning Province in NE China. The processing plant can be completed within 3 months of IMX securing funding.

Pictures A, B, C, D: Cairn Hill Trial Mine - the dark area in images B and C is exposed ore with blasted ore evident in image D.

Testwork conducted by SGS Oretest:

•Ore is soft and easy to crush and grind.

•Dry magnetic separation after crushing to P100 of 10mm followed by wet magnetic separation after grinding to P80 of 500 microns and 250 microns to produce a 68.8% and 69.9% Fe magnetite respectively.

•Premium quality ultra coarse magnetite concentrate.

Aim to produce 1.9 million mtpa ROM ore producing 1.2mtpa magnetite concentrate.

If the iron grade can be increased sufficiently it may be possible to ship an intermediate concentrate to an existing plant and avoid the capital and operating cost of grinding and wet magnetic separation.

Next steps

•Upgrade the mineralisation so that mine planning can be undertaken.<

•Additional testwork to optimise the flowsheet and determine the effects of finer crushing on iron grade improvements and recoveries.

•Feasibility study in parallel with the preparation of the necessary approvals for mining and processing.

Initial investigations suggest that the capital and site operating costs will be significantly less than more conventional magnetite operations.