Karnalyte Resources Inc. Announces 2021 First Quarter Results
KARNALYTE.COM
TSX: KRN
KARNALYTE RESOURCES INC. ANNOUNCES 2021 FIRST
QUARTER RESULTS
Not for distribution to U.S. news wire services or dissemination in the United States.
SASKATOON, SK (CNW- May 14, 2021) – Karnalyte Resources Inc. ("Karnalyte" or the "Company") (TSX:
KRN) today announced its financial results and corporate highlights for the first quarter ended March
31, 2021.
During the first quarter of 2021, the Company focused on the activities surrounding the strategic review that
was initiated in 2020 including analysis, valuation and market sounding activities for the Wynyard Potash
Project, review and analysis of the proposed nitrogen project (the “ Proteos Nitrogen Project”), and
external/independent review of the pre-feasibility study completed internally with assistance from the
Company’s strategic partner, Gujarat State Fertilizers and Chemicals (“GSFC”).
The Company has been in contact with multiple potential partners for the Wynyard Potash Project. The
Company has also been in contact with several potential partners for the Proteos Nitrogen Project.
Discussions with these potential partners are ongoing. Management expects to provide an update as to these
discussions and the conclusions of the strategic review in the coming weeks.
POTASH - MARKET UPDATE
The agricultural industry is showing strength worldwide, with strong crop prices increasing demand for
fertilizer. The supply/demand gap for potash appears to be tightening as signalled by recent modest price
increases. Overall, the prospects for increases in potash prices are positive given these factors and an overall
positive outlook for commodities. The Company continues to closely monitor the global market conditions
for potash.
NITROGEN – MARKET UPDATE
With respect to nitrogen, strength in the agricultural industry worldwide, strong crop prices and the
resulting affordability of fertilizer to growers coupled with some global production outages has resulted in
significant increases to nitrogen prices. The Company continues to monitor the market conditions for
nitrogen fertilizer.
OUTLOOK FOR 2021
During the second quarter of 2021, the Company plans to complete the strategic review that was initiated in
2020 and solidify a strategic direction for the Company. The Company expects to announce the results of this
over the coming weeks. It will also be necessary in 2021 for the Company to spend time and financial
resources in dealing with various court actions commenced against it.
2021 FIRST QUARTER RESULTS
At March 31, 2021, the Company had cash of $3.3 million and positive net working capital of $3.1 million
and no debt. The Company has adequate cash to fund any existing commitments in 2021 as well as to
meet short term operating and capital requirements. The Company is considering strategic alternatives
as the ability of the Company to continue as a going concern will require further equity issuances or
other forms of financings. Karnalyte’s First Quarter 2021 Financial Statements and Managements’
Discussion and Analysis are available at www.sedar.com and on Karnalyte’s website at
www.karnalyte.com.
The following information has been summarised from the Company's Condensed Interim Unaudited
Financial Statements.
March 31, 2021 March 31, 2020
Total revenue - -
Net and comprehensive loss (577) (483)
Basic and diluted per share (0.01) (0.01)
Total current assets 4,177 7,647
Total assets 10,110 13,442
Total liabilities 2,748 2,595
Total shareholders’ equity 7,362 10,847
ABOUT KARNALYTE RESOURCES INC.
Karnalyte Resources Inc. is a development stage company focused on two fertilizer products, potash
and nitrogen, to be produced and manufactured in Saskatchewan. Karnalyte owns the construction
ready Wynyard Potash Project, with planned phase 1 production of 625,000 tonnes per year (“ TPY”) of
high grade granular potash, and two subsequent phases of 750,000 TPY each, taking total production up
to 2.125 million TPY. Karnalyte is also exploring the development of the Proteos Nitrogen Project,
which is a proposed small-scale nitrogen fertilizer plant with a nameplate production capacity of
approximately 700 metric tonnes per day (“MTPD”) of ammonia and approximately 1,200 MTPD of
urea, and a target customer market of independent fertilizer wholesalers in Central Saskatchewan.
ABOUT THE WYNYARD POTASH PROJECT
The Wynyard Potash Project is a construction ready solution mining potash project located in Wynyard,
Saskatchewan, with planned phase 1 production of 625,000 TPY of high grade granular potash, and two
subsequent phases of 750,000 TPY each, taking total production up to 2.125 million TPY. All
environmental permits remain valid, preliminary detailed engineering is complete, and the existing
offtake agreement with Gujarat State Fertilizers & Chemicals Limited remains in effect. Further
development is dependent on improved potash prices and obtaining financing.
ABOUT THE PROTEOS NITROGEN PROJECT
The Proteos Nitrogen Project is an advanced stage development project consisting of a proposed small-
scale nitrogen fertilizer plant to be located in Central Saskatchewan, having a nameplate production
capacity of approximately 700 MTPD of ammonia and approximately 1,200 MTPD of urea, and designed
to produce two products – anhydrous ammonia (82-0-0) and granular urea (46-0-0). Karnalyte’s primary
target market is independent local Saskatchewan fertilizer wholesalers within a 400-kilometer radius of
Saskatoon, Saskatchewan. A secondary target market is the US Midwest fertilizer wholesalers near to
the Canadian – United States border. The proposed plant would be the first greenfield nitrogen
fertilizer plant built in Canada in the last 26 years.
ABOUT GUJARAT STATE FERTILIZERS & CHEMICALS LIMITED
Gujarat State Fertilizers & Chemicals Limited (“GSFC”) is a leading Indian Fortune 500 chemicals and
fertilizer company that has been in business for more than 50 years. GSFC currently operates one
ammonia plant that was commissioned in the year 2000, and two urea plants that were established in
1969, at its fertilizer production complex in Vadodara, Gujarat State, India.
As the Company’s strategic partner and single largest shareholder, GSFC remains committed to the
Company and the Wynyard Potash Project, and is fully supportive of the Company pursuing the
development of the Proteos Nitrogen Project. GSFC has also confirmed to the Company that it will
continue to support the structuring of the most cost-effective financing package for the development
of the Wynyard Potash Project, as GSFC has consistently offered to the Company since becoming a
shareholder in 2013.
For further information, please contact:
Danielle Favreau
Interim CEO
Karnalyte Resources Inc.
1(306) 986-1486
www.karnalyte.com
FORWARD-LOOKING STATEMENTS
Certain information included in this press release is forward-looking, within the meaning of applicable
Canadian securities laws. Forward-looking information is often, but not always, identified by the use of
words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “plan”, “intend”, “forecast”,
“future”, “guidance”, “may”, “predict”, “project”, “should”, “strategy”, “target”, “will” or similar
words or phrases suggesting future outcomes or language suggesting an outlook.
The forward-looking statements contained in this press release are based on certain key expectations
and assumptions made by Karnalyte, including, without limitation, assumptions as to: projected
economics for the Company’s planned potash production facility, the confirmation in an independent
feasibility study of Karnalyte’s assumptions regarding the technical and economic viability of the
Proteos Nitrogen project, the ability of Karnalyte to obtain financing on terms favourable to the
Company, and the ability of Karnalyte to receive, in a timely manner, the necessary approvals from the
Company’s board of directors, shareholders, regulatory authorities, and other third parties.
Karnalyte believes the expectations and assumptions upon which the forward-looking information is
based are reasonable. However, no assurance can be given that these assumptions and expectations
will prove to be correct. Accordingly, readers should not place undue reliance on the forward-looking
statements and information contained in this press release. Without limiting the generality of the
foregoing, readers are cautioned that the Company has not received a feasibility study prepared by a
third party with respect to the Proteos Nitrogen project.
Actual results may vary from the forward-looking information presented in this press release, and such
variations could be material. Risk factors and uncertainties could cause actual results to vary from the
forward-looking information in this press release. Additional information on forward-looking statements
and other factors that could affect Karnalyte’s operations and financial results are included in
documents on file with Canadian securities regulatory authorities and may be accessed through the
Company’s profile on the SEDAR website (www.sedar.com).
These forward-looking statements are made as of the date hereof and are expressly qualified in their
entirety by this cautionary statement. Subject to applicable securities laws, the Company assumes no
obligation to update or revise them to reflect new events or circumstances.