A technique for lossy compression of images is presented, utilizing ideas of logic minimization. The approach specifically addresses the compression of the binary image data originated in Block Truncation Coding (BTC). The binary vector corresponding to a block of 4 X 4 pixels is treated as the output of a Boolean function and prime cubes are generated. The largest prime cube is encoded. Bit rate less than 1.5 bits/pel is attained in BTC without many perceivable errors in the reconstructed grey scale image. Training, pre-stored tables or codebooks, and prior knowledge of the image source are not required by the technique which uses simple logic operations. Computational simplicity of the algorithm makes it suitable for VLSI implementation. Potential of the technique in attaining rate less than 0.5 bit/pel by applying on image sequences and extending to blocks of larger size is indicated.