Karnalyte Resources Inc. Announces Completion of Magnesium Testing

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SASKATOON, Dec. 6, 2017 /CNW/ - Karnalyte Resources Inc. ("Karnalyte" or the "Company") (TSX: KRN) announces the completion of magnesium testing by industry leading experts in mineral processing, Saskatchewan Research Council ("SRC").

The authors of the Company's technical report filed on SEDAR on July 15, 2016 (the "Technical Report") noted that the Company's pre-feasibility study, described a process for the production of basic Magnesium Carbonate ("BMC") that has a fine grain size and large surface area and that, to confirm the suitability of this process, the Company had requested SRC duplicate and confirm the overall process and to determine product qualities. SRC's past test work showed that the proposed process would allow for the production of >99% purity BMC. The Technical Report also noted that SRC proposed further test work to:

• Define process parameters to produce a range of surface areas;
• Tailor the crystal morphologies;
• Optimize particle size distribution; and
• Determine parameters for producing later stage high purity, medium to high reactive magnesium oxide powder.

The Company previously announced that, during the third quarter of 2017, production brine containing magnesium chloride was extracted from the Belle Plaine zone in the test cavern for further testing to explore the potential of producing high purity 99% plus Magnesium Compounds in a variety of specified formulations that could meet different industrial specifications.

Recently, SRC has produced a report titled "BMC Production and Calcination Laboratory Test" (the "Report"). The Report indicates that >99% BMC and Magnesium Oxide ("MgO") can both be produced from Karnalyte's future magnesium chloride brine tailings. In addition to purity, a wide range of crystal morphologies were produced making the high purity MgO products potentially suitable for a variety of industrial applications including:

• Polymer and plastic additives;
• Fuel, oil and refinery additives;
• Rubber vulcanization;
• Catalysts;
• Mineral flame retardants; and
• High purity chemical feedstock for other magnesium compounds.

Further confirmation will be required, in the form of a continuous scaled-up pilot test that will be performed concurrently with a feasibility study in the future.

Karnalyte's Interim CEO Todd Rowan commented "High Grade BMC and Magnesium Oxide produced from tailings will make magnesium development very attractive for Karnalyte in the future.  Once the potash facility is operational, the required brine will become available to turn this into a reality."

ABOUT KARNALYTE RESOURCES INC.

Karnalyte is a Saskatchewan-headquartered company focused on exploration and development of potash and magnesium in Saskatchewan. The Company intends to develop and extract a carnallite-sylvinite mineral deposit through a solution mining process, at a competitive cost and with minimal environmental impact. Using a staged approach to potash and magnesium plant construction, the Company plans to operate the initial facility at Wynyard, Saskatchewan to produce 625,000 tonnes per year ("TPY") of potash ("Phase I"), increasing to 1,375,000 and 2,125,000 TPY of potash in subsequent phases of the project.

Karnalyte's Common Shares are traded on the TSX under the symbol KRN.

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 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 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.

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 Corporation assumes no obligation to update or revise them to reflect new events or circumstances.

SOURCE Karnalyte Resources Inc.

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