Karnalyte Resources Inc. Files Preliminary Short Form Base Shelf Prospectus

CALGARY, Sept. 10, 2012 /CNW/ - Karnalyte Resources Inc.("Karnalyte" or the "Corporation"), filed on September 7, 2012 a preliminary short form base shelf prospectus with the securities commissions in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador. If a (final) short form base shelf prospectus is filed, the filing will, subject to securities regulatory requirements, allow the Corporation to make offerings of common shares, units, preferred shares in series and notes or other types of unsecured debt securities (collectively, the "Securities") up to an aggregate offering price of $350 million during the 25-month period that the final short form base shelf prospectus, including any amendments thereto, remains effective. The Securities may be offered at prices and on terms to be determined based on market conditions at the time of sale and set forth in an accompanying shelf prospectus supplement or in certain cases, an accompanying pricing supplement.

Unless otherwise specified in a prospectus supplement, the net proceeds from the sale of the Securities will be used to fund the development of Karnalyte's Wynyard Carnallite project on its property, which is comprised of a total of 85,126 acres of land and which includes the area covered by Karnalyte's Subsurface Mineral Permit KP 360A and Subsurface Mineral Lease KLSA 010.

A copy of the preliminary short form base shelf prospectus may be obtained from the Corporation by directing a request to Karnalyte Resources Inc. at Unit 104, 26 Crystalridge Drive, Okotoks, Alberta, T1S 2C3, Telephone 778-372-1806, Attention: Chief Financial Officer, or can be found on SEDAR at www.sedar.com.

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 minimal environmental impact.  Using a staged approached to potash plant construction, the Corporation plans to operate a solution mining facility that will initially produce 625,000 tpy of potash, increasing to 2.125 million tpy potash.  Karnalyte owns a 100% interest in Subsurface Permit KP 360A and Subsurface Mineral Lease KLSA 010 located near Wynyard, Saskatchewan, comprising a total of 85,126 acres.

Forward-Looking Statements

This press release contains forward-looking statements.  More particularly, this press release contains statements concerning the Corporation's offering of securities and projected use of proceeds.  The forward-looking statements contained in this document are based on certain key expectations and assumptions made by Karnalyte, including with respect to the Corporation's future operations.  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.

SOURCE: Karnalyte Resources Inc.

For further information:

Robin Phinney, President & Chief Executive Officer
Ron Love, Chief Financial Officer & Executive Vice-President 
Telephone: (403) 995-6560
E-mail: info@karnalyte.com
Website: www.karnalyte.com


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