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SASKATOON, SK, Sept. 24,
2024 /CNW/ - 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 underground deposits," said Danielle Favreau, Chief Executive Officer.
Carnallite, also known 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 should 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
magnesium as one of Canada's 34
critical minerals. 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 high-tech applications such as
semiconductor manufacturing, lithium-ion battery production, and in
industries such as metallurgy, pharmaceuticals, agriculture,
wastewater treatment, 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 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 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 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.
GSFC is the Company's strategic partner and single largest
shareholder.
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.
SOURCE Karnalyte Resources Inc.