Encanto announces clarification of reserves and resources

TRADING SYMBOL:  TSXV:EPO

VANCOUVER, March 25, 2014 /CNW/ - Encanto Potash Corp. ("Encanto" or the "Corporation") (TSXV: EPO and OTCQX: ENCTF) issues the following clarifying disclosure as a result of a review by the British Columbia Securities Commission.

Encanto is retracting previous corporate disclosures which incorrectly included the Measured and Indicated tonnages with the Reserves and references to an expanded expected mine life.  Further, Encanto retracts any reference in previous corporate disclosures which alluded to Inferred resources referencing an expanded mine life.  Adding any classification of Resources to Reserves in disclosures is contrary to CIM best practices which states, "Mineral Resources must never be added to Mineral Reserves and reported as total Resource and Reserves."  The addition of Resources to Reserves is misleading as it treats Mineral Resources as if they were Reserves and implies economic viability that has not been demonstrated.

Investors should not rely on any previous disclosures that included Reserves and Resources together. The Reserves currently provide for up to a 57 year mine life.

Encanto announced the positive results of a Pre-Feasibility Study dated February 28 2013 titled "Encanto Potash Corp. Technical Report Summarizing the Preliminary Feasibility Study for the Muskowekwan First Nations Home Reserve Project in South Eastern Saskatchewan, Canada", in which it reported a Proven and Probable Recoverable Reserve of 161.97 million tonnes grading 28% KCI.  This Reserve tonnage would support a mine life of 57 years with an assumed extraction rate of 2.8 million tonnes annually. 

The reserve/resource breakdown is as follows:

Solution Mining Resource Summary (Proven and Probable Reserves)*

Category

KCI Reserves (MMT)

Total Proven Reserves

34.23

Total Probable Reserves

127.74

Proven and Probable Reserves

161.97

*Note – Reserves listed above in addition to and separate from the Resources listed in the table below.


Solution Mining Resource Summary (Measured and Indicated)

Category

KCI Resources (MMT)

Total Measured

4.84

Total Indicated

30.56

Total Measured and Indicated

35.40



Solution Mining Resource Summary (Inferred)

Category

KCI Resources (MMT)

Total inferred

165.80

About Encanto:

Encanto Potash Corp. is a TSX Venture Exchange listed and OTCQX traded Canadian resource company engaged in the development of potash properties in the Province of Saskatchewan, Canada, the largest producing potash region in the world. Through a joint venture agreement with Muskowekwan Resources Ltd. ("MFN JV") on our flagship property, Encanto has a project land package which totals approximately 61,000 largely contiguous acres. A Pre-Feasibility Study dated February 28 2013 titled "Encanto Potash Corp. Technical Report Summarizing the Preliminary Feasibility Study for the Muskowekwan First Nations Home Reserve Project in South Eastern Saskatchewan, Canada" confirms the Proven & Probable KCI Reserves totaling 162 MMt grading 28% which supports primary and secondary mining for over 50 years at an assumed annual rate extraction rate of 2.8 million tonnes.

The Company has an interest in two additional potash properties in Saskatchewan: 20% interest in the 55,000 acre Ochapowace/Chacachas property and 100% interest in the 55,437 acre Spar property.

Encanto is currently exploring domestic & international strategic partnerships for the financing, development and sale of potash production from its MFN JV Property.

The technical content of this news release has been reviewed and approved by James Walchuck, a qualified person as defined by NI 43-101.

For additional information about Encanto Potash Corp., please visit the Company's website at www.encantopotash.com or review the Company's documents filed on www.sedar.com.

ON BEHALF OF THE BOARD OF DIRECTORS

Per:   "James Walchuck"   
James Walchuck
President and CEO

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

THE FOREGOING INFORMATION MAY CONTAIN FORWARD-LOOKING INFORMATION RELATING TO THE FUTURE PERFORMANCE OF THE COMPANY. FORWARD LOOKING INFORMATION IS SUBJECT TO A NUMBER OF KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE ANTICIPATED IN OUR FORWARD LOOKING STATEMENTS. SUCH RISKS AND OTHER FACTORS INCLUDE, AMONG OTHERS, THE ACTUAL RESULTS OF EXPLORATION ACTIVITIES, CHANGES IN WORLD COMMODITY MARKETS OR EQUITY MARKETS, THE RISKS OF THE MINING INDUSTRY INCLUDING, WITHOUT LIMITATION, THOSE ASSOCIATED WITH THE ENVIRONMENT, DELAYS IN OBTAINING GOVERNMENTAL APPROVALS, PERMITS OR FINANCING OR IN THE COMPLETION OF DEVELOPMENT OR CONSTRUCTION ACTIVITIES, TITLE DISPUTES, CHANGE IN GOVERNMENT AND CHANGES TO REGULATIONS AFFECTING THE MINING INDUSTRY, AND OTHER RISKS AND UNCERTAINTIES DETAILED FROM TIME TO TIME IN THE COMPANY'S FILINGS WITH THE CANADIAN SECURITIES ADMINISTRATORS (AVAILABLE AT WWW.SEDAR.COM). FORWARD-LOOKING STATEMENTS ARE MADE BASED ON VARIOUS ASSUMPTIONS AND ON MANAGEMENT'S BELIEFS, ESTIMATES AND OPINIONS ON THE DATE THE STATEMENTS ARE MADE. SHOULD ONE OR MORE OF THESE RISKS AND UNCERTAINTIES MATERIALIZE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE DESCRIBED IN THE FORWARD-LOOKING INFORMATION CONTAINED HEREIN. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE FORWARD-LOOKING STATEMENTS IF THESE ASSUMPTIONS, BELIEFS, ESTIMATES AND OPINIONS OR OTHER CIRCUMSTANCES SHOULD CHANGE, EXCEPT AS REQUIRED BY APPLICABLE LAW.

SOURCE Encanto Potash Corp.

For further information: James Walchuck, President and CEO, Tel: 604-683-2402; Martin Gagel CFA, MBA, Vanguard Shareholder Solutions, Tel: 604-608-0824, Toll Free: 1-866-918-0824