Encanto Potash Corp. announces $6,000,000 private placement offering of
flow-through shares and units

/NOT FOR DISTRIBUTION TO A US NEWSWIRE SERVICE OR FOR DISSEMINATION IN THE UNITED STATES/

Trading Symbol: TSXV EPO.V

VANCOUVER, May 17 /CNW/ - Encanto Potash Corp. (the "Company") is pleased to announce that it has entered into an agreement with Mackie Research Capital Corporation ("Mackie Research Capital") to act as lead agent and sole bookrunner, on a best-efforts basis, for a private placement offering (the "Offering") of up to $5,000,000 in common shares to be issued on a "flow-through" basis ( the "Flow-Through Shares") and up to $1,000,000 in units (the "Units"), for aggregate gross proceeds to the Company of $6,000,000.

The Offering will be priced in the context of the market, with indicative terms of $0.23 per Flow-Through Share and $0.20 per Unit, each Unit consisting of one common share and one-half of one common share purchase warrant. Each whole common share purchase warrant will entitle the holder thereof to acquire one common share of the Company at a price of $0.25 for a period of 24 months from the date of the closing of the Offering.

The proceeds from the issuance of the Flow-Through Shares will be used to fund the Company's ongoing exploration programs on its qualifying properties in the Province of Saskatchewan. The proceeds from the issuance of the Units will be used by the Company for working capital.

In connection with the Offering, a cash commission of 6.0% of the aggregate gross proceed arising therefrom will be paid to Mackie Research Capital. In addition, upon closing of the Offering Mackie Research Capital will receive non-transferable options, exercisable into common shares of the Company at any time up to 24 months from the date of the closing of the Offering, equal to 6.0% of the number of Units issued and exercisable at the price of the Units, and 5.0% of the number of Flow-Through Shares issued and exercisable at the price of the Flow-Through Shares.

All securities issued in connection with the Offering will be subject to a hold period of four months from the date of the closing of the Offering. The Offering is subject to the approval of the TSX Venture Exchange.

At this time the Company also announces the resignation of Wayne Roberts from its Board of Directors. The Company would like to thank Mr. Roberts for his contribution to the board and wishes him every success in his future endeavors.

About Encanto:

Encanto Potash Corp. is a TSX Venture Exchange-listed Canadian resource company engaged in the exploration and development of potash properties in the Province of Saskatchewan, Canada, the largest producing region for potash in the world.

For additional information about Encanto Potash Corp., please visit the Company's website at www.encantopotash.com or review the Company's documents filed on www.sedar.com.

ON BEHALF OF THE BOARD OF DIRECTORS

    
          "James Walchuck"
    Per:  -----------------------

          James Walchuck
          President and CEO
    

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

The foregoing information may contain forward-looking information relating to the future performance of the Company. Forward looking information is subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in our forward looking statements. Such risks and other factors include, among others, the actual results of exploration activities, changes in world commodity markets or equity markets, the risks of the mining industry including, without limitation, those associated with the environment, delays in obtaining governmental approvals, permits or financing or in the completion of development or construction activities, title disputes, change in government and changes to regulations affecting the mining industry, and other risks and uncertainties detailed from time to time in the Company's filings with the Canadian securities administrators (available at www.SEDAR.com). Forward-looking statements are made based on various assumptions and on management's beliefs, estimates and opinions on the date the statements are made. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking information contained herein. The Company undertakes no obligation to update forward-looking statements if these assumptions, beliefs, estimates and opinions or other circumstances should change, except as required by applicable law.

For further information: James Walchuck, President and CEO, Tel: [phone]; Keith Schaefer, Vanguard Shareholder Solutions, Tel: [phone], Toll Free: 1-866-918-0824