CALGARY, June 14, 2013 /CNW/ - Karnalyte Resources Inc. ("Karnalyte" or
the "Corporation") (TSX: KRN) today announced that it has entered into
an engagement letter (the "Engagement Letter") pursuant to which it has
engaged BNP Paribas and Natixis, New York Branch, on an exclusive
basis, to act as lead arrangers (the "Lead Arrangers") for a senior
secured project finance facility (the "Facility") of up to US$300
million. The purpose of the Facility is to fund the construction and
commissioning of the Wynyard Carnallite Project (the "Project").
The Facility will be structured on an underwritten basis whereby each
Lead Arranger will underwrite 50% of the Facility subject to credit
approval, due diligence and satisfactory legal documentation, and will
syndicate it to banks, financial institutions and other institutional
lenders. The Engagement Letter contemplates the entering into of a
definitive term sheet and commitment letters for the Facility upon the
satisfaction of certain conditions.
The net proceeds from the Facility together with funds provided through
Gujarat State Fertilizers and Chemicals Ltd., the Corporation's
strategic investor, will provide Karnalyte with approximately 60% of
the total capital required to construct the Project. Karnalyte is
pursuing a financing strategy for the Project based on a combination of
the Facility and equity.
Bank of Montreal is acting as Karnalyte's financial advisor in
connection with the Facility.
About Karnalyte Resources Inc.
Karnalyte is engaged in the 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 impacts. Using a staged approached to potash plant
construction, the Corporation plans to operate a solution mining
facility that will initially produce 625,000 tonnes of potash per year,
increasing to 2.125 million tonnes of potash per year. Karnalyte owns a
100% interest in Subsurface Permit KP 360A and Subsurface Mineral Lease
KLSA-010 located near Wynyard, Saskatchewan, comprising a total of
About BNP Paribas
BNP Paribas (www.bnpparibas.com) has a presence in nearly 80 countries with 190,000 employees,
including 145,000 in Europe. It ranks highly in its three core
activities: Retail Banking, Investment Solutions and Corporate &
Investment Banking. In Europe, the Group has four domestic markets
(Belgium, France, Italy and Luxembourg) and BNP Paribas Personal
Finance is the leader in consumer lending. BNP Paribas is rolling out
its integrated retail banking model across Mediterranean basin
countries, in Turkey, in Eastern Europe and a large network in the
western part of the United States. In its Corporate & Investment
Banking and Investment Solutions activities, BNP Paribas also enjoys
top positions in Europe, a strong presence in the Americas and solid
and fast-growing businesses in Asia-Pacific.
This press release contains forward-looking statements. More
particularly, this press release contains statements concerning the
Corporation's securing of a credit facility 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. Readers are
cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could affect
Karnalyte's operations and financial results are included in documents
on file with Canadian Securities regulatory authorities and maybe
accessed through the SEDAR website (www.sedar.com). 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, Executive Vice-President & Chief Financial Officer
Telephone: (403) 995-6560