Verde Potash Provides Update on Corporate Activities and FLSmidth Processing Run

TORONTO, Dec. 4, 2012 /CNW/ - Verde Potash (TSX: "NPK") ("Verde" or the "Company") is pleased to provide an update with respect to corporate activities including results from the processing run at FLSmidth's facility in Pennsylvania, the negotiation of off-take agreements with Brazilian fertilizer buyers, and progress on the Company's Bankable Feasibility Study ("BFS") for the Cerrado Verde potash project.

Successful FLSmidth Four Week Processing Run

Verde conducted a four week test of its potash rock to KCl process at FLSmidth's rotary kiln facility in Pennsylvania. FLSmidth is the largest supplier of rotary kiln equipment in the world, with over 2,500 units installed. Verde successfully processed 42 tonnes of feed material during this period. The testing allowed for the optimization of variables in the KCl production process, including the quantities of potash rock, salt and limestone used, kiln temperature and kiln residence time. The tests at FLSmidth also enabled the Company to confirm the results of Verde's own test work at its facility located in Belo Horizonte, Brazil. Results from the FLSmidth tests will be incorporated into the Company's BFS.

Off-Take Agreement Negotiations Initiated

The Company is currently engaged in negotiations with a number of potential counterparties regarding an off-take agreement for the Company's granular KCl product. Each of the entities the Company is engaged with is currently a buyer of granular KCl in Brazil. The purpose of an off-take agreement would be to assist potential lenders to the project in completing their due diligence and to expedite the process of securing debt financing.

Lender Due Diligence Discussions Commence

Management has entered into discussions with key development agencies regarding debt funding of the Cerrado Verde project. The Company has begun providing these lending agencies with financial and technical data regarding the project.

Bankable Feasibility Study on Track for H1 2013

The Company is on track to publish its BFS in the first half of 2013. A consortium of top tier engineering companies have been engaged to produce a BFS for the Cerrado Verde potash project, which will build on the PEA published in February 2012, the test work completed at FLSmidth's facility and the 2012 in-fill drilling results at the Cerrado Verde property.

Balance Sheet Update

As outlined in the Company's Q3 2012 financials, Verde had $21.1 million in cash and cash equivalents on its balance sheet as at September 30, 2012. Management is confident that the Company's liquidity position is sufficient to fund the completion of the BFS in H1 2013 and to fund all other necessary corporate activities through 2014.

About Verde Potash

Verde Potash, a Brazilian fertilizer exploration and development company, is focused on advancing the Cerrado Verde Project located in the heart of Brazil's largest agriculture market. Cerrado Verde is the source of a potash-rich deposit from which the Company intends to produce potassium chloride (KCl). In addition, the Company is developing its Calcario limestone project, limestone being a key raw material in the production of KCl.

About the Cerrado Verde Potash Project

Cerrado Verde is a unique project: 1) its high grade potash rock outcrops and is amenable to strip mining, allowing fast construction of a scalable operation; 2) it is located in the midst of the world's third largest and fastest growing fertilizer market; 3) it connects to Brazil's largest fertilizer distribution districts via existing and high quality infrastructure; 4) it has the potential to supply KCl to Brazil's local agriculture market from its large potash-rich deposit.