Karnalyte Resources Inc. (
TSX: T.KRN,
Stock Forum) said Monday it has written off its Wynyard Carnallite Project in Saskatchewan.
“The board of directors has determined that in the current price environment for potash, it is not possible to finance and profitably construct and operate a potash production facility at the Wynyard Project,’’
the company said in a press release.
The company went on to say that it is suspending all activity in relation to the Wynyard Project other than the minimum required to maintain title to the project.
Karnalyte shares fell 10% to 71 cents on Monday, leaving a market cap of $19.5 million, based on 27.5 million shares outstanding. The 52-week range is $1.38 and 71 cents.
The company said it had been in talks with an Indian financial institution, but added that talks have not resulted in a proposal that would be in the best interests of the company.
Meanwhile, after completing an impairment review, the company said it has incurred a non-cash impairment expense of $59.1 million related to the Wynyard Project. The company said the project is now carried on its balance sheet at approximately $4 million, an amount that reflects its salvage value, the company said.
Carnallite is an evaporate mineral, a hydrated magnesium chloride. It is used mostly in fertilizers and is an important source of potash.
The Wynyard Carnallite Project is an exploration and early stage pre-development property with a dominant zone of carnallitite and sylvinite (potassium-containing minerals).
Read more at https://www.stockhouse.com/news/newswire/2015/04/13/karnalyte-resources-t-krn-writes-off-saskatchewan-potash-project-stock-down-10#9hWJC7mjbY7P42oY.99