Athabasca Potash Inc.
TSX : API

Athabasca Potash Inc.

August 12, 2008 20:25 ET

Athabasca Potash Inc. Announces Second Quarter Results

SASKATOON, SASKATCHEWAN--(Marketwire - Aug. 12, 2008) - Athabasca Potash Inc. (TSX:API) ("Athabasca" or the "Company") reports the unaudited results of Athabasca's operations for the quarter ended June 30, 2008 have been filed and may be viewed at www.sedar.com.

A summary of key financial and operating results for the quarter follows:

Highlights

- 3-D seismic survey on 60.22 kms was completed and the compilation and interpretation of the survey data is now complete.

- Appointment of Terry Walbaum as Chief Operating Officer, Bradley Fettis as Vice President, Mining and Robert Connochie as Advisor to the Management.

- In addition to the Burr Project, the Company has obtained 22 permits with five permits granted in the quarter for prospective potash mineralization.

- MDH Engineered Solutions Corp. has been engaged for a tailings management and site study for the Environmental Assessment Review.

- The issued and outstanding shares are 36,836,623 at June 30, 2008.

Burr Project

During the first half of 2008, Athabasca continued to focus on the exploration and development of its 100% owned Burr Project. A 3-D seismic survey covering 60.22 square kilometres was completed in January 2008. The compilation and interpretation of the survey data is now complete. The results of the survey will be used to help identify localized geological hazards and the optimal mine shaft location.

Assay results from the five exploration drill holes completed in 2007 were received in February, 2008. The assay results are available in the press release dated February 19, 2008 at www.sedar.com or www.athabascapotash.ca. An updated National Instrument 43-101 compliant technical report and resource estimate is scheduled for completion by the third quarter of 2008 and will include the five historical drill holes and the five holes drilled in 2007.

Quarter End Results

As of June 30, 2008, Athabasca's cash and cash equivalents balance totalled $45,659,608 for the quarter ended. The Company recorded a net loss of $209,894 ($0.01 per share) compared to a net loss of $72,324 ($0.01 per share) for the same period in 2007. The Company's source of income is the result of investing excess cash reserves in short-term deposits. For the quarter ending June, 2008, the Company reported interest revenue of $379,528, compared to $16,722 for the quarter ending June 30, 2007.

Total operating costs for the quarter ending June 30, 2008 equalled $686,322 compared to $97,846 for the quarter ended June 30, 2007. This represents an increase of $588,476 and reflects increases in all categories of expenditures associated with the administration of a public company. Management fees and wage expense increased from $49,471 in the second quarter of 2007 to $170,287 for the quarter ending June 30, 2008. The $120,816 increase resulted primarily from the growth of the Company's management and technical team. Business development and investor relations increased to $157,533 during the second quarter of 2008 compared to $19,629 for the same period in 2007 as a result of the Company's additional promotion and travel expenses.



Selected financial highlights include:

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June 30, December 31,
Balance Sheets 2008 2007
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Current assets $ 46,766,343 $ 45,089,755
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Total assets 62,419,771 55,285,777
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Current liabilities 559,938 1,779,404
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Future income tax liability 1,281,083 -
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Share capital 57,209,822 51,762,028
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Contributed surplus 5,374,121 4,495,951
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Deficit 2,005,193 2,751,606
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June 30, June 30,
Statements of Income 2008 2007
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Interest Income $ 379,528 $ 16,722
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Operating Expenses 686,322 97,846
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Loss for the period before income taxes (306,794) (81,124)
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Net (loss) income for the period (209,894) (72,324)
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(Loss) income per share (0.01) (0.01)
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June 30, June 30,
Statements of Cash Flows 2008 2007
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Cash flows from operating activities $ (177,560) $ (88,059)
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Cash flows from investing activities (1,000,036) (885,724)
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Cash flows from financing activities 193,178 10,129,729
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Increase (decrease) in cash and cash
equivalents (984,418) 9,155,946
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Cash and cash equivalents - beginning of
period 46,644,026 794,874
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Cash and cash equivalents - end of period 45,659,608 9,950,820
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Outlook

Athabasca recently initiated its planned 2008 summer drill program at the Burr Project. The Company plans to drill up to six potash exploration drill holes to better define and further expand the resources estimate. The Company has also engaged MDH Engineered Solutions Corp. to do hydrology and hydrogeological testing for mine site and tailings management, and the selection of shaft locations.

A 3-D seismic survey was completed in January 2008 and the compilation and interpretation of the survey is now complete. The drill results from the five drill holes completed in 2007 were received and an updated 43-101 compliant resource estimate is being prepared by AMEC Americas Ltd. ("AMEC") incorporating the new drill results and the 3-D seismic results. The Company is also evaluating opportunities relating to the additional 22 potash exploration permits it holds.

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