Potash Ridge Corporation
TSX : PRK

Potash Ridge Corporation

May 25, 2016 16:39 ET

Potash Ridge Closes Second Tranche of $1.4 Million Private Placement and Provides Update on Projects

TORONTO, ONTARIO--(Marketwired - May 25, 2016) - Potash Ridge Corporation (the "Corporation") (TSX:PRK), a near term producer of premium fertilizer in North America, is pleased to announce the successful closing of the second tranche of the non-brokered Private Placement ("Private Placement") originally announced on May 20, 2016.

The Private Placement offering of units ("Units") was at a price of $0.25 per Unit. Each Unit comprised one common share in the capital of the Corporation (a "Common Share") and one-half of one Common Share purchase warrant. Each whole warrant entitles the holder to purchase one Common Share at $0.50 for a period of three years from the date of closing.

All securities issued in connection with the Private Placement are subject to a restricted period that expires four months plus one day following the date of issuance. The Private Placement is subject to requisite regulatory approvals. In connection with the Private Placement, the Corporation agreed to pay fees to certain qualified finders totaling $41,868.

The Private Placement was capped at $1,400,000 of gross proceeds, representing the total amount of underlying shares available to be issued before necessitating shareholder approval under the Toronto Stock Exchange private placement rules.

Guy Bentinck, President and Chief Executive Officer, commented, "Since November of last year, we have raised $3.8 million in three capital raises to advance our 100%-owned Valleyfield and Blawn Mountain sulphate of potash projects. Sulphate of potash has been one of the best performing commodities over the last few years, and there has been strong investor interest in each of our capital raises, which demonstrates the compelling nature of our projects."

The proceeds of the recent capital raises will allow the Corporation to advance the Valleyfield Project in Quebec and the Blawn Mountain Project in Utah, as highlighted below, and provide sufficient working capital for beyond the end of 2016.

Valleyfield Project:

  • In April 2016, SNC completed a capital and operating budget study ("SNC's Valleyfield Study"). SNC estimated the total capital cost of the Valleyfield facility to be Cdn$48.8 million for a 40,000 tonne per annum sulphate of potash facility. Based on SNC's Valleyfield Study, the Corporation projects an after-tax net present value of Cdn$67 million, assuming a 10% discount rate, and an unlevered after-tax rate of return of 32.5%.

  • Negotiations are advancing on various commercial matters related to Valleyfield, including input commodity supply arrangements, offtake agreements, and project financing. On project financing, discussions have already commenced with multiple parties.

  • Detailed engineering and permitting work for Valleyfield are expected to commence shortly.

  • Assuming successful completion of commercial and other project matters, the Corporation expects to break ground on construction in late 2016.

Blawn Mountain Project:

The Corporation also remains very committed to advancing its Blawn Mountain Project in Utah, a world class sulphate of potash development project.

In this regard, the Corporation intends to engage an engineering company shortly to assess the potential of phasing the development, with the initial phase at a more modest scale than what was contemplated in the Prefeasibility Study, thereby reducing the upfront capital cost. It is anticipated that the results of this study will be completed during the 3rd quarter of 2016.

About Potash Ridge

Potash Ridge's strategy is to become a premier producer of sulphate of potash or SOP in North America. The Corporation owns two SOP projects: the Valleyfield Project that plans to produce SOP through the Mannheim Process; and the Blawn Mountain Project in Utah that plans to produce SOP by processing an alunite material. Potash Ridge has a highly qualified and proven management team in place with significant financial, project management and operational experience and the ability to take projects into production.

Forward-Looking Statements

This press release contains forward-looking statements, which reflect the Corporation's expectations regarding future growth, results of operations, performance and business prospects. These forward-looking statements include statements related to advancing the Valleyfield Project and may also include statements that are predictive in nature, or that depend upon or refer to future events or conditions, and can generally be identified by words such as "may", "will", "expects", "anticipates", "intends", "plans", "believes", "estimates", "guidance" or similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These statements are not historical facts but instead represent the Corporation's expectations, estimates and projections regarding future events. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Corporation, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to: the state of the equity capital markets; the receipt of any required approvals for the private placement; the future financial or operating performance of the Corporation and its subsidiaries and its mineral projects; the anticipated results of exploration activities; the estimation of mineral resources; the realization of mineral resource estimates; capital, development, operating and exploration expenditures; costs and timing of the development of the Corporation's mineral projects; timing of future exploration; requirements for additional capital; climate conditions; government regulation of mining operations; anticipated results of economic and technical studies; environmental matters; receipt of the necessary permits, approvals and licenses in connection with exploration and development activities; appropriation of the necessary water rights and water sources; changes in commodity prices; recruiting and retaining key employees; construction delays; litigation; competition in the mining industry; reclamation expenses; reliability of historical exploration work; reliance on historical information acquired by the Corporation; optimization of technology to be employed by the Corporation; title disputes or claims and other similar matters.

If any of the assumptions or estimates made by management prove to be incorrect, actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained herein. Such assumptions include, but are not limited to, the following: that general business, economic, competitive, political and social uncertainties remain favorable; that agriculture fertilizers are expected to be a major driver in increasing yields to address demand for premium produce, such as fruits and vegetables, as well as diversified protein rich diets necessitating grains and other animal feed; that actual results of exploration activities justify further studies and development of the Corporation's mineral projects; that the future prices of minerals remain at levels that justify the exploration and future development and operation of the Corporation's mineral projects; that there is no failure of plant, equipment or processes to operate as anticipated; that accidents, labour disputes and other risks of the mining industry do not occur; that there are no unanticipated delays in obtaining governmental approvals or financing or in the completion of future studies, development or construction activities; that the actual costs of exploration and studies remain within budgeted amounts; that regulatory and legal requirements required for exploration or development activities do not change in any adverse manner; that input cost assumptions do not change in any adverse manner, as well as those factors discussed in the section entitled "Risk Factors" in the Corporation's Annual Information Form (AIF) for the year-ended December 31, 2015 found on sedar.com. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

Contact Information

  • Potash Ridge Corporation
    Ross Phillips
    Chief Financial Officer
    416-362-8640 ext. 103
    rphillips@potashridge.com

    Potash Ridge Corporation
    Jay Hussey
    Vice President, Corporate Finance
    President, Valleyfield Fertilizer
    416-362-8640 ext. 102 or C: 416.918.6589
    jhussey@potashridge.com

    For investor relations inquiries:
    Skanderbeg Capital Advisors
    Mario Vetro
    604-687-7130 x105 or C: 778-846-9970
    Mario@skanderbegcapital.com