Pan American Fertilizer Corp. (CNSL: PAF) Provides an Update on its Merger Partner, Pacific Potash Corporation

Friday, October 12, 2012

VANCOUVER, BRITISH COLUMBIA, October 12th, 2012 - Pan American Fertilizer Corp. (CNSX:PAF) ("Pan American" or the "Company") is pleased to provide an update on Pacific Potash Corporation's Brazilian operations located in the Amazonas basin. The Company and Pacific Potash Corporation ("
Pacific Potash") have signed an Arrangement Agreement in respect of a proposed business combination of the two companies, details of which are set out in the Company's news release dated September 21, 2012.

Representatives from Pacific Potash traveled to the property in late August and conducted a site visit, property tour and compiled historic and new information on the property and surrounding basin from various government and private sources. All information was compiled and analyzed extensively by Pacific Potash officials, management and Qualified Person(s) as defined by NI 43-101.

Pacific Potash used four basic criteria to review and prioritize its extensive land package:

1. (i)Environmentally sensitive areas, natural reservation and indigenous land;

2. (ii)Accessibility (including logistically challenged areas, flooded ground, etc...)

3. (iii)Geomorphology

4. (iv)Geological potential

Based upon this review and prioritization, Pacific Potash has reduced its claims in the Amazonas Basin from 1,474,208 hectares to 805,834 hectares. A map outlining the updated property outline may be found at the bottom of the news release. The reduction in the size of the property is expected to focus Pacific Potash's exploration efforts on the areas with the highest geologic potential, and significantly reduce the annual government taxes/fees required to maintain the property in good standing. Pacific Potash has also commenced an NI 43-101 qualifying report on the Amazonas Potash Property ("Property"). Pacific Potash is also investigating potential commercial offers form local and international strategic partners to earn an interest on a portion of the Property.

Dean Pekeski, P.Geo and Director of Pacific Potash stated "Our review, prioritization, and reduction in size of the Amazonas Property has allowed us to define three target areas. These areas will be further studied and prioritized, and we will develop appropriate potash exploration programs accordingly. The reduction in the size of the block will save Pacific Potash significant amounts of government fees. We can now direct these funds to our exploration program. Our goal remains to identify significant potash resources within our updated claim block."

Randy Wright of Pan American commented "The new tenement package, the large amount of work being conducted by other Potash companies in the immediate area and the indefinite moratorium on new claims being offered by the Brazilian government in the basin bode well for the future exploration and development of Pacific Potash's Amazonas basin potash property."

To View Map Image, below, please copy and paste URL below into a new browser:

http://thenewswire.ca/client_files/2012-10-11-1.pdf

Qualified Person

Dean Pekeski, P.Geol., a Director for Pacific Potash and a qualified person for the purposes of NI 43-101, has approved the preparation of the technical information in this news release.

About Pan American Fertilizer Corp.

Pan American is a Canadian company dedicated to providing fertilizer to a growing global market. The company is focused on the extraction of a specific type of fertilizer called calcium sulphate (also referred to as "Agricultural Gypsum"). To ensure long term development and increase shareholder value, Pan American currently plans to significantly expand its current operational objectives while expanding its asset base by acquiring additional calcium sulphate and other fertilizer related assets.

When used as a fertilizer and as a soil remediator, calcium sulphate is a soft sulfate mineral composed of calcium sulfate dihydrate which is extremely rich in sulphur and calcium. When dissolved in water, the mineral becomes calcium and sulphate sulphur ions, both of which are required nutrients for plants. Calcium sulphate plays a vital role in establishing and maintaining good chemical balance in soil, water and plants, specifically with healthy root development. Ultimately, calcium sulphate increases overall crop quality and yields. www.PAFertilzer.com

About Pacific Potash Corporation

Pacific Potash Corporation trades on the TSX Venture Exchange under the symbol: PP, as well on the OTCQX under the symbol: PPOTF and on the Frankfurt Stock Exchange under P9P. Pacific Potash is engaged in the exploration and development of the Provost Potash Property and the surrounding potash claims targeting the prolific Prairie Evaporite Formation, which is host to multiple conventional and solution potash mines. The Company also has an option to acquire an 80% interest in Western Potash Corporation's (TSX: WPX) Amazonas Basin claims.

On behalf of the board of directors of Pan American Fertilizer Corp.

"Randy Wright"

Randy Wright

President and CEO

FOR MORE INFORMATION, PLEASE CONTACT:

Jeff French

Investor Relations

jfrench@pafertilizer.com

(604)638-3480

The CNSX does not accept responsibility for the adequacy or accuracy of this release.

Forward Looking Statements

Statements contained in this news release that are not historical facts constitute "forward-looking statements" or "forward-looking information" within the meaning of applicable securities laws and are based on expectations, estimates and projections as of the date of this release. The words "is expected" or "estimates" or variations of such words and phrases or statements that certain actions, events or results "may" or "could" occur and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Pan American as of the date of such statements, 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. Many of these factors can affect Pan American's actual results and could cause actual results to differ materially from those expressed or implied in any forward looking statements made by, or on behalf of, Pan American. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management's expectations and plans relating to the future.