Karnalyte Resources Inc. to Review Development Strategy FOR Its Flagship Wynyard Project
KARNALYTE.COM
TSX: KRN
KARNALYTE RESOURCES INC. TO REVIEW DEVELOPMENT
STRATEGY FOR ITS FLAGSHIP WYNYARD PROJECT
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SASKATOON, SK (CNW- September 24, 2024) – Karnalyte Resources Inc. ("Karnalyte" or the "Company")
(TSX: KRN) today announced it will begin a review of its development strategy to evaluate the economic
potential of increasing magnesium chloride production at the Company’s Wynyard Project by developing
the magnesium assets at the same time as the development of the potash project.
“We have initiated preliminary studies to determine the economic opportunity of co -developing
magnesium and potash production from the Company’s significant underground carnallite and potash
deposits,” said Danielle Favreau, Chief Executive Officer.
Carnallite, also know n as hydrated potassium magnesium chloride, is abundant within the Company’s
mineral deposit. The studies are determining the economic balance of developing carnallite for the co -
production of magnesium chloride and potassium chloride with the aim of significantly increasing
magnesium chloride production , compared to previous studies , through the application of advanced
solution mining technologies.
“Our goal is to create the most economically feasible operation we can while delivering value to
shareholders. In light of the increasing importance of magnesium as one of the building blocks for the
green and digital economy, we are reevaluating our strategy and we believe we have a duty to review
the inclusion of concurrent and optimized magnesium and potash deposit development in our plans for
the benefit of all stakeholders,” Ms. Favreau added.
The Government of Canada lists m agnesium as one of Canada’s 34 critical mineral s. Magnesium also
appears on critical minerals lists in other jurisdictions, such as the United States of America, the
European Union, Japan, South Korea and Australia. Magnesium is a key mineral in the clean technologies
and advanced manufacturing value chains.
Magnesium chloride serves as a key raw material in the production of various chemicals, including
magnesium metal, magnesium hydroxide, magnesium oxide, and magnesium carbonate. These chemicals
are used in industries such as metallurgy, pharmaceuticals, agriculture, wastewater treatment, and high-
tech applications such as semiconductor manufacturing, lithium -ion battery production, and advanced
materials synthesis, driving the demand for magnesium chloride.
See The Canadian Critical Minerals Strategy published by the Government of Canada and available at
https://www.canada.ca/en/campaign/critical-minerals-in-canada/canadian-critical-minerals-
strategy.html.
The Company plans to make progress on its NI 43-101 technical report through the remainder of the year,
which is a key precursor to any mine construction. The company also expects to complete the study on
the review of its development strategy by the first quarter of 2025.
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 pr oduction 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 the continued strength of 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 appr oximately 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
Chief Executive Officer
Karnalyte Resources Inc.
1(639) 638-2537
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 facili ty, 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 pla ce 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 Compa ny’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.
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