Allana Potash Appoints Leading International Bank as Project Financing Advisor

TORONTO, ONTARIO -- (Marketwire) -- 10/03/11 -- Allana Potash Corp. (TSX: AAA)(OTCQX: ALLRF) ('Allana' or the 'Company') is pleased to announce the engagement of BNP Paribas, a leading international investment bank, as financial advisor for the arrangement and structuring of debt financing for the construction of Allana's Ethiopian potash project.

BNP Paribas has Corporate and Investment Banking offices in over 50 countries worldwide, including 12 countries throughout Africa. BNP Paribas has extensive expertise in financing African mining projects with over 30 large-scale transactions completed or ongoing, including significant experience in African fertilizer and potash project debt financing as well as structured commercial financing in Ethiopia. Ranked as the top mandated lead arranger of global export credit agency ('ECA') backed loans for the last four years by Dealogic, BNP Paribas has facilitated transactions with ECA's, international development banks and other global and regional financial institutions and funds that participate in the financing of projects similar in nature to Allana's.

BNP Paribas will advise Allana in determining an appropriate financing plan and approach potential lenders with the view to raising project finance debt. BNP Paribas will also work alongside and integrate with the work of Allana's Feasibility Study contractor, ERCOSPLAN (see September 6, 2011 news release), and will coordinate with the ongoing Environmental and Social Impact Assessment ('ESIA') now underway with Environmental Resources Management (see August 24, 2011 news release). This integration and coordination is intended to ensure that the project's commercial and supply arrangements, along with the due diligence requirements of participating lenders, are developed and assessed in a manner to provide for the most efficient financial closing process subsequent to the completion of the Feasibility Study and ESIA in late 2012.

'Allana is looking forward to working with BNP Paribas and the financial community in developing a team of lenders committed to supporting our Dallol potash project,' said Farhad Abasov, Allana's President and CEO. 'The management team and our advisors believe that most of the debt financing can be sourced from large multi-lateral financing organizations as well as ECA's. We are encouraged by past successful financings of similarly structured resource projects in Africa and we are confident that BNP Paribas' experience and global network will help us to secure the project's financing.'

In consideration for providing the financial advisory services, Allana will pay BNP Paribas a monthly cash work fee, and subject to the receipt of any applicable regulatory approvals, issue to BNP Paribas 1,400,000 Allana common share purchase warrants (the 'Warrants'). Each Warrant shall be exercisable to acquire one common share of Allana at CAD $0.94 per warrant for a period of five years from the date of issue. The Warrants shall vest and become exercisable upon the completion of various milestones. The issuance and terms of the Warrants remains subject to the receipt of all necessary approvals, including, without limitation, approval of the Toronto Stock Exchange.

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. Allana has secured financial support from two significant strategic investors: IFC, a member of World Bank Group, and Liberty Metals and Mining, a member of Liberty Mutual Group. Allana has Measured and Indicated Sylvinite Resources of 97.8 Million Tonnes of 30.0% KCl; Inferred Sylvinite Resource of 108.3 Million tonnes grading 31.3% KCl; Measured Indicated Kainitite Resources of 284.2 Million tonnes at 19.8% KCl, Inferred Kainitite Resource of 271.2 Million tonnes of 20.3% KCl; Measured Indicated Upper Carnallitite Resources of 78.5 Million tonnes grading 18.4% KCl, Inferred Upper Carnallitite Resource of 85.6 Million tonnes of 17.1% KCl; Measured Indicated Lower Carnallitite Resources of 212.6 Million tonnes of 12.0% KCl, Inferred Lower Carnallitite Resource of 130.7 Million tonnes grading 11.7% KCl. Allana has approximately 197.5 million shares outstanding and trades on the Toronto Stock 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 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 financial advisory engagement on the Company, the receipt of all regulatory approvals, the estimation of mineral reserves and mineral resources; the timing and amount of estimated future exploration; costs of exploration; capital expenditures; success of exploration activities; permitting time lines and permitting, ; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; and title disputes or claims; 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.

Contacts:

Investor Cubed

Neil Simon

647 258 3311
info@investor3.ca