Allana Potash Corp.

Allana Potash Corp.

February 09, 2010 07:30 ET

Allana Potash Corp. Provides Update on Exploration Activities in Ethiopia

TORONTO, ONTARIO--(Marketwire - Feb. 9, 2010) - Allana Potash Corp. Inc. (TSX VENTURE:AAA) ("Allana" or the "Company"), is pleased to provide an update of exploration activities at its Danakhil Potash Project in Ethiopia.

The main activities include camp construction, road rehabilitation and mobilizing a diamond drill and support infrastructure for the planned 2,500 - 3,000 m drill program. The objective of the drill program is to confirm drill results from previous work on the project, increase the confidence in the estimated Inferred mineral Resource reported last year to such a level that it, or part of it, can be upgraded to the Indicated category, and to add additional inferred resources from the middle of the evaporite basin.

Allana management has requested the government of Ethiopia to repair a road leading to the potash project. The road was damaged due to unseasonable high rains. This has created challenges with transport of drill rig and other heavy equipment using the local access roads that pass through the highlands west of the Danakhil Potash Project. In addition, portions of the road have had to be re-contoured to allow heavy truck and machinery to pass.

The Ethiopian government has demonstrated a strong commitment to Allana's project by mobilizing construction crews to fix the road. Six Ethiopian government road crews and heavy machinery are active and have rehabilitated approximately 40 km of road to date (see for pictures). The government estimates that the road repairs will be completed by mid-February.

The main shipments of Allana's modular camp have arrived in Djibouti and are currently clearing Customs. Upon clearing Customs, and subject to road re-construction, the camp will be trucked to the project area to begin camp construction. It is estimated that camp construction will be completed in approximately two weeks from arrival at the project site.

Drilling equipment has also already arrived at Djibouti and is in the process of clearing Customs. The main drilling rig, as well as the Marooka support vehicle, is currently being processed through Customs. Management has estimated that this process will take 10-14 days after which the equipment will be transported to the Allana storage area in Mekele. Two additional shipments of tools, rods and drilling supplies have also arrived in Djibouti and are being processed through Customs. Transport to Mekele will follow the clearing of Customs and all drilling equipment is expected to be at the project site and functioning by the last week of February or early March.

The Company will issue another news release once the drill program is underway.

Farhad Abasov, President and CEO, commented: "Allana management is grateful to the federal government of Ethiopia for its commitment and dedication to our potash project by mobilizing road construction crews in the last two months. The government crews have been making steady progress in completing the road rehabilitation, and we are extremely excited that this will allow us to start our drill campaign in the next few weeks. I would also like to thank our exploration and government relations executives whose contributions have been invaluable to Allana's progress to date. The start of drilling will position Allana at the forefront of potash exploration efforts in Ethiopia, and will pave the way to a full-fledged development stage for our potash project".

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 with NI 43-101-compliant Inferred Mineral Resource of over 100 million tonnes of potash mineralization (Sylvite and Kainite) with a composite grade of 20.8 % KCl (see News Release Sept. 17, 2008). Allana has approximately 98.1 million shares outstanding and trades on the TSX-Venture exchange under the symbol "AAA".

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.

Forward-Looking Statement

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 road re-construction and drill program on the Company, the receipt of all required regulatory approvals, estimated production, the estimation of mineral reserves and mineral resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; capital expenditures; success of exploration activities; permitting time lines and permitting, mining or processing issues; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; litigation liabilities; limitations on insurance coverage and the effect of terminating the investor relations contract. 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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