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TORONTO, ONTARIO--(Marketwire - Feb. 7, 2011) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES

Allana Potash Corp. (TSX VENTURE:AAA) ("Allana" or "the Company"), is pleased to announce that Liberty Metals & Mining Holdings, LLC ("LMM"), a subsidiary of Liberty Mutual Group and the Company's largest shareholder, has elected to exercise its participation rights in connection with the Company's previously announced brokered private placement for proceeds of up to $32,085,000 (including exercise in full of the over-allotment option) (See Allana news release dated February 4, 2011).

In order to maintain its 16.27% ownership in the Company, LMM has agreed to purchase up to 4,022,748 common shares (the "Common Shares") of the Company on a non-brokered basis at a purchase price of $1.55 per Common Share for total gross proceeds $6,235,259.40 (the "Financing").

The net proceeds from the Financing will be used to fund continued exploration and development work, including a definitive feasibility study, at the Company's Ethiopian potash project as well as future potential strategic land acquisitions and general corporate purposes.

Closing of the Financing is anticipated to occur concurrently with the brokered private placement on or about March 1, 2011 (the "Closing Date") and is subject to the receipt of applicable regulatory approvals including approval of the TSX Venture Exchange. The Common Shares will be subject to a statutory hold or restricted period of four months and one day following the Closing Date.

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 with Inferred Mineral Resources of 70.3 million tonnes of kainitite mineralization grading 61.7 % kainite and 30.3 million tonnes of sylvinite resource grading 25.4 % sylvite (combined 105,200,000 tonnes with a composite grade of 20.8 % KCl (see News Release dated Sept. 17, 2008). Allana has approximately 149.3 million shares outstanding and trades on the TSX-Venture 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 the 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 terms and use of proceeds of the Financing, the ability of the Company to complete the Financing and the impact of the Financing on the Company. 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 information is 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 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 information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information 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 information. The Company does not undertake to update any forward-looking information that is included herein, except in accordance with applicable securities laws.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements.

NEITHER THE 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.