Drilling Continues to Intersect Strong Potash Expanding the Deposit and Confirming Continuity
TORONTO, ONTARIO–(Marketwire – March 19, 2012) – Allana Potash Corp. (TSX:AAA)(OTCQX:ALLRF) (“Allana” or the “Company”) is pleased to announce that it has intersected two zones of strong potash mineralization in Holes DK-11-32, DK-11-33, and DK-11-34 (“Holes 32, 33,and 34”). All Holes are located southeast of the Musley Deposit, an area targeted to test the extension of the Sylvinite Zone into a gap in the previous drilling pattern. All holes intersected two main zones of potash mineralization, sylvinite and kainitite. Hole 34 intersected 3 metres of 38.4% KCl in the Sylvinite Zone and 7.9 metres of 22.9% KCl in the Kainitite Zone. Hole 33 intersected 1.5 metres of 30.1% KCl in the Sylvinite Zone and 6 metres of 23.9% KCl in the Kainitite Zone. Hole 32 intersected a Sylvinite Zone 1.4 metres wide of 29.6% KCl within a zone 3.2 metres thick of sylvinite and carnallite. Hole 32 intersected the Kainitite Zone at a depth of 203.2 metres and returned 3.3 metres of 15.4% KCl.
Holes 32, 33, and 34 are located southeast of the historic Musley Deposit, north of Holes 16 and 8 and east of Hole 31. Potash mineralization was intersected at relatively shallow depths in all holes with sylvinite occurring at depths of 197.1 metres, 467.5 metres and 174.0 metres in Holes 32, 33, and 34 respectively.
Farhad Abasov, President and CEO, commented: “Allana continues to be pleased with the continuity and strength of potash mineralization in the western portion of the property as exhibited by the results of Holes 32, 33, and 34. This area continues to yield high grade potash in the Sylvinite and Kainitite zones, which management believes will allow Allana to upgrade mineral resources from Inferred to Measured and Indicated categories as well as add to the Indicated and Inferred mineral resource categories. In last year’s mineral resource update, this area represented a gap in the drilling pattern and no sylvinite mineral resources were calculated for this region. Management believes the presence of sylvinite mineralization in all three holes indicates an extension of the Sylvinite Zone into this area. The relatively shallow and high grade nature of the Sylvinite Zone make this area ideal for solution mining with recovery through solar evaporation.
Holes 32, 33, and 34 are part of an in-fill drilling program in the west designed to test the extension of the potash mineralization associated with the historic Musley Deposit and allow upgrading of the mineral resource estimate to the Measured and Indicated mineral resource categories and to expand the Sylvinite mineral resource in this area. The results for Holes 32, 33, and 34 are presented in the table below. True widths of the potash zones are estimated to be very similar to drilled widths due to the flat-lying nature of the potash horizons. The zones of potash mineralization are outlined in the following table:
|HOLE ID||FROM (m)||TO (m)||WIDTH (m)*||KCL (%)||ZONE|
Hole 32 was drilled vertically and was collared approximately 500 metres northeast of Hole 31 (see attached figure). Hole 32 is located in the western part of the concession block and east of the historic Musley Deposit suggesting that potash mineralization at Musley continues into the gap between Holes 30 and 16. Previously released Allana drill holes in this region yielded high sylvinite grades (see attached figure) and the results of Hole 32 further support the interpretation of the extension of potash throughout the region.
Hole 33 was drilled vertically and is located approximately 1000 metres east of Hole 32 (see attached figure). The presence of sylvinite and kainitite in this region suggests the continuity of the potash mineralization further east from Hole 32, extending the Musley Deposit to the eastern margin of the Allana license in this area.
Hole 34 was drilled vertically and is approximately 1000 metres north of Hole 16. The strong potash mineralization in this hole, where both sylvinite and kainitite were intersected, indicates continuity of the zones between Holes 16 and 8 in the south and Holes 10 and 30 in the north.
Exploration drilling has shifted to the far eastern part of the property (Hole 46) as part of the mineral resource expansion drill program that management has designed to expand the mineral resources. Samples from Holes 35-45 are undergoing analysis or are en route to the laboratory in Saskatoon, Canada. Technical studies in support of the Feasibility Study are in progress including geotechnical drilling to supply large diameter core for rock mechanic testwork, solar evaporation pond construction, environmental baseline studies and hydrogeological studies. Allana has recently initiated a ground resistivity survey over the western portion of its property to identify aquifers in the alluvial fans. This technique has been successful in the past at outlines water sources in sand and gravel. Mobilization of drilling equipment is ongoing and water well drilling is expected to commence in Q2, 2012. Recent photographs of evaporation pond construction are available to be seen on the company’s web-site.
About Allana Potash Corp.
Allana is a publicly traded corporation with a focus on the acquisition and development of potash assets internationally with its major focus on a previously explored potash property in Ethiopia. Allana has secured financial support from two significant strategic investors: IFC, a member of World Bank Group, and Liberty Metals and Mining, a member of Liberty Mutual Group. Allana has Measured and Indicated Sylvinite Resources of 97.8 Million Tonnes of 30.0% KCl; Inferred Sylvinite Resource of 108.3 Million tonnes grading 31.3% KCl; Measured and Indicated Kainitite Resources of 284.2 Million tonnes at 19.8% KCl, Inferred Kainitite Resource of 271.2 Million Tonnes of 20.3% KCl; Measured and Indicated Upper Carnallitite Resources of 78.5 Million Tonnes grading 18.4% KCl, Inferred Upper Carnallitite Resource of 85.6 Million Tonnes of 17.1% KCl; Measured and Indicated Lower Carnallitite Resources of 212.6 Million Tonnes of 12.0% KCl, Inferred Lower Carnallitite Resource of 130.7 Million Tonnes grading 11.7% KCl. The foregoing mineral resource estimates are as at June 13, 2011 and are set out in the Company’s NI 43-101 compliant Technical Report entitled “Resource Report for the Danakhil Potash Deposit, Afar State/Ethiopia” dated June 24, 2011 filed on SEDAR. Allana has approximately 228.5 million shares outstanding and trades on the Toronto Stock Exchange under the symbol “AAA”.
Quality Control and Quality Assurance
Allana employees follow standard operating and quality assurance procedures intended to ensure that all sampling techniques and sample results meet international reporting standards. Procedures for handling core samples begin with securing the potash-bearing HQ-NQ-sized core at the drill site in plastic poly-tubing which is then thermally sealed. Core is placed in plastic core boxes and transported to Allana’s camp for geological logging, geotechnical logging and photographing. Significant intervals are dry cut in half using a specially modified tungsten carbide bladed band-saw. Half core samples are then double bagged and thermally sealed prior to transporting to Addis Ababa by Allana personnel. In this initial phase, halite blanks are randomly inserted into the sample stream at a rate of 1 in 20 and sent for analysis with the core samples. The remaining core is re-sealed in plastic poly-tubing and the core boxes secured at Allana’s exploration camp. Upon arrival in Addis Ababa core samples are stored at Allana’s small warehouse facility and then taken to the Ethiopian Ministry of Mines & Energy where permission is obtained to export the samples. The bagged samples are then carefully packed into boxes and shipped via DHL to the Saskatchewan Research Council in Saskatoon. This sampling procedure was initiated by ERCOSPLAN Ingenieurgesellschaft Geotechnik und Bergbau mbH, Allana’s potash consulting firm, supervised by Allana’s Ethiopian based Project Manager Jason Wilkinson, M.Sc., and periodically reviewed by Allana’s Senior Vice President of Exploration, Peter J. MacLean, Ph.D., P. Geo.
Allana is utilizing SRC’s Potash ICP Analysis package designed for multi-element analysis of potash samples. Upon arrival at SRC Geoanalytical Laboratories, core samples are jaw crushed to 60 % @ -2mm and 100 g sub sample is split out using a riffler and transferred to vials. The subsample is pulverized to 90 % @ -106 microns using a puck and ring grinding mill to create a pulp. The grinding mills are cleaned between groups using Quintus quartz. The pulp is then transferred to a labelled plastic snap top vial. An aliquot of pulp is placed in a test-tube with 15 ml of 30°C DI water. The sample is shaken. The soluble solution is then analyzed by ICP-OES. The method is suitable for the soluble analysis of commercial potash (Sylvite). The soluble solution is then analysed by ICP-MS. In addition, samples are analysed for FeO (wt%), Br and Cl by MS, plus insolubles. SRC Geoanalytical Laboratories has been certified by the Standards Council of Canada (SCC) to conform to the requirements of ISO/IEC 17025:2005 (CAN-P-4E).
Peter J. MacLean, Ph.D., P. Geo., Allana’s Senior VP Exploration, is a Qualified Person as defined under National Instrument 43-101 and has reviewed and approved the technical information presented in this release.
Except for statements of historical fact relating to the Company, certain information contained herein constitutes “forward-looking information” under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the effect and estimated timeline of the drilling and assay results on the Company, the estimation of mineral reserves and mineral resources; the timing and amount of estimated future exploration; costs of exploration; capital expenditures; success of exploration activities; permitting time lines and permitting, ; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; and title disputes or claims; Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. The Company does not undertake to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except in accordance with applicable securities laws.
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