The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from Marketwire

Karnalyte Resources Inc. Announces Operations Update

Monday, December 20, 2010

Karnalyte Resources Inc. Announces Operations Update08:45 EST Monday, December 20, 2010CALGARY, ALBERTA--(Marketwire - Dec. 20, 2010) -NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.Karnalyte Resources Inc. ("Karnalyte" or the "Corporation") (TSX:KRN) announces today that it has commenced a drilling program comprised of two drill targets as recommended in its National Instrument 43-101 preliminary assessment study dated August 26, 2010. The focus of the drilling program is to provide large diameter core for rock mechanical analysis which management anticipates will be used in a feasibility study and for inclusion in future resource updates. The first well of the program has currently reached the zone of interest and is scheduled to be cored prior to December 31, 2010, after which management anticipates drilling will commence on the second location with completion expected by mid January 2011. Upon completion of both wells, the extracted core will be forwarded to third party laboratories for assays and analysis.Karnalyte also announces that it has granted an aggregate of 528,000 stock options to directors, officers, employees and consultants of the Corporation, of which, 408,000 stock options were granted to directors and officers, in accordance with the Corporation's incentive stock option plan. All of the options are exercisable at same price as the Corporation's initial public offering price of $8.60 per share. The options all vest in equal tranches of one-fourth every six months following the date of grant and expire after five years.About Karnalyte Resources Inc.Karnalyte is engaged in the business of exploration and development of high quality agricultural and industrial potash and magnesium products. Karnalyte intends to develop and extract a carnallite - sylvite mineral deposit through a known solution mining process at competitive costs and with minor environmental impact. Karnalyte owns a 100% interest in Permit KP 360 located near Wynyard, Saskatchewan which is comprised of 83,981 acres.This press release contains forward-looking statements. More particularly, this press release contains statements concerning the Corporation's future operations and the completion of its drilling program. The forward-looking statements contained in this document are based on certain key expectations and assumptions made by Karnalyte, including with respect to the anticipated timing for completion of drilling and the uses of the resulting core. Although Karnalyte believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Karnalyte can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the failure to obtain necessary regulatory approvals, risks associated with the mining industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price and exchange rate fluctuations. The forward-looking statements contained in this document are made as of the date hereof and Karnalyte undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.The securities offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any applicable U.S. state securities laws and may not be offered or sold in the United States, absent registration or any applicable exemption from the registration requirement of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.FOR FURTHER INFORMATION PLEASE CONTACT: Robin PhinneyKarnalyte Resources Inc.President & Chief Executive Officer(403) 995-6560ORRon LoveKarnalyte Resources Inc.Chief Financial Officer & Vice-President Finance(403) 995-6560ORJulius BrinkmanKarnalyte Resources Inc.Vice-President Corporate Development(403) 995-6560info@karnalyte.comwww.karnalyte.com