TORONTO, Feb 7 (Reuters) - Shares of Karnalyte Resources were among the biggest losers on the Toronto Stock Exchange on Tuesday after the exploration company said it continues to address regulator concerns about its resource estimate for its Wynyard potash project in Saskatchewan.
In December, Karnalyte shares fell nearly 25 percent after it was forced to shelve a proposed C$115 million ($115 million) financing because the Alberta Securities Commission sought clarification of its reserve and resource estimates for Wynyard.
At the time, Karnalyte said it had held discussions with the securities regulator to review its concerns. It added, however, that as a result of the delay, a final short form prospectus could not be filed in the required timeframe forcing it to back down on the equity financing deal.
Calgary, Alberta-based Karnalyte, said late on Monday it has now received a further comment letter from the regulator. It did not provide details.
The announcement spooked investors and sent Karnalyte shares tumbling as low as C$8.10, almost 20 percent below Friday’s close of C$10.03 a share. Shares of the company were trading at C$8.50 a share at 2.30 p.m. (1930 GMT) on Tuesday.
Analysts believe the company’s latest announcement may well result in whole new round of interaction between the company and the regulator that could delay development of the project.
Karnalyte said it remains committed to advancing the project and will provide a further update when available.
“We are pleased with the progress we have made and will continue to work with the ASC to resolve the outstanding comments on the technical report,” Chief Executive Robin Phinney said in a statement.
$1=$1.00 Canadian Reporting By Euan Rocha; Editing by Peter Galloway