KARNALYTE RESOURCES ANNOUNCES MAJOR SHAREHOLDER GSFC TO PARTICIPATE IN RIGHTS OFFERING

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SASKATOON, Sask., July 28, 2022 /CNW/ – Karnalyte Resources Inc. (“Karnalyte“or the”Company“) (TSX: KRN) is pleased to announce today that its strategic partner and significant shareholder, Gujarat State Fertilizers and Chemicals (“GSFC“), will participate in the Company’s rights offering (the “Rights OfferingGSFC’s participation further demonstrates its continued commitment and support to Karnalyte and the Wynyard Potash project.

“The additional investment we will receive through GSFC’s participation in the Rights Offering demonstrates the belief and confidence that GSFC, a major player in the india agricultural sector, has in the vision and strategic planning of Karnalyte,” said Danielle Favreau, interim CEO of Karnalyte. “This is great news for our company as we work towards our ultimate goal of maximizing value for shareholders and all stakeholders through the financing and construction of the Wynyard Potash project.

GSFC is a leading fertilizer and industrial chemical manufacturing company in Indiawith a 38.73% stake in Karnalyte.

The strategic partnership between Karnalyte and GSFC, established in 2013, provides a significant competitive advantage to Karnalyte in the market. Participation in the rights offering is further evidence of confidence in Karnalyte’s efforts over the years, as the development of Karnalyte will help provide GSFC with a secure supply of potash for years to come.

A copy of the Rights Offering Notice and Rights Offering Circular is available on Karnalyte’s website at www.karnalyte.com.

ABOUT KARNALYTE RESOURCES INC.

Karnalyte Resources Inc. is a development-stage company focused on two fertilizer products, potash and nitrogen, which will be produced and manufactured in Saskatchewan. Karnalyte owns the Wynyard Potash project, with planned Phase 1 production of 625,000 tonnes per year (“TYP“) of high-grade granular potash, and two subsequent phases of 750,000 TPY each, bringing total production to 2.125 million TPY. Karnalyte is also exploring the development of the company’s nitrogen project, which is a plant proposal small-scale nitrogen fertilizer plant with a design production capacity of approximately 700 metric tons per day (“MTPD“) of ammonia and approximately 1,200 MTJ of urea, and a target market of independent fertilizer wholesalers in central Saskatchewan.

FORWARD-LOOKING STATEMENTS

Certain information contained 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”, “have the intention”, “plan”, “future”, “direction”, “may”, “predict”, “plan”, “should”, “strategy”, “target”, “will” or similar words or expressions suggesting future results or language suggesting a perspective.

The forward-looking statements contained in this press release are based on certain key expectations and assumptions made by Karnalyte, including, without limitation, assumptions regarding: economic forecasts of the company’s planned potash project, confirmation in a feasibility study independent of Karnalyte’s assumptions regarding the technical and economic viability of the Nitrogen Project, Karnalyte’s ability to obtain financing on terms favorable to the Company, and Karnalyte’s ability to receive, in a timely manner, the necessary approvals from the Board, shareholders, regulatory authorities, and other third parties.

Karnalyte believes that the expectations and assumptions on 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 advised that the Company has not received a feasibility study prepared by a third party regarding the Nitrogen Project.

Actual results may differ 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 differ from the forward-looking information contained in this press release. Additional information about forward-looking statements and other factors that could affect Karnalyte’s operations and financial results are included in filings with Canadian securities regulators and can be viewed through the company’s profile at 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 undertakes no obligation to update or revise them to reflect new events or circumstances.

SOURCE Karnalyte Resources Inc.

For further information: Karnalyte Resources Inc., +1 (306) 986-1486, [email protected]www.karnalyte.com

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