Cerium and Lanthanum Separated into Individual Products, Resulting in Significantly Reduced Mass Going to Advanced Separation

Bench-Scale Optimization Removed Nearly All Cerium and Produced a High-Purity Light Rare Earth Basket

December 16, 2015 – Lakewood, Colorado – Rare Element Resources Ltd. (NYSE MKT: REE and TSX: RES), a publicly traded, strategic materials company focused on delivering rare earth products for technology and defense applications by advancing the Bear Lodge Critical Rare Earth Project located in northeast Wyoming, announces additional results from its successful pilot-plant campaign of its patent-pending, zero-discharge solvent extraction (SX) separation technology, as well as the results of subsequent bench-scale optimization test work.  The results of this most recent test work include:

• Pilot plant testing of a lanthanum recovery circuit that resulted in a 99%-pure lanthanum oxide product, samples of which were promptly supplied to an interested party for evaluation; and
• Optimization, at bench-scale, of the recovery process that not only increased cerium removal to 99% using one mixer/settler but also separated the remaining rare earths into light rare earth (LRE) and heavy rare earth (HRE) baskets using only two mixer/settlers.  The resulting LRE stream was 99.7% pure and consisted predominantly of lanthanum and didymium (neodymium and praseodymium). It is expected that using the LRE stream as feed for the lanthanum recovery module will produce both pure lanthanum and pure didymium products.  

Each SX module used conventional extraction mixer/settlers and commercially available stripper reagents, extractants and diluents but did not require acid-stripping mixer/settlers or the use of strong acids to recover separated rare earths. The process generated no waste effluent and eliminated the need for neutralization, important accomplishments that are expected to improve the cost-effectiveness of the process. The SX pilot plant successfully recycled both the stripped organic liquor and raffinate without generating any waste products, making it environmentally sound.  

“The data generated by testing confirmed and expanded our success at utilizing our proprietary separation technology to increase the purity of our concentrate while recovering commercially valuable separated rare earth products that were then supplied to an interested potential offtake partner,” said Randall J. Scott, President and Chief Executive Officer.  “In bench-scale test work, we effectively optimized the cerium removal to 99% and also separated out the remaining light rare earths to make the recovery of both pure lanthanum and pure didymium products possible.  While additional pilot testing is expected to optimize the process, METSIM® modeling, a steady-state and dynamic process simulator, indicates that 99% of the lanthanum could be recovered, thus reducing the mass of rare earth solutions going to advanced separation by more than 65%.”  

The Company has initiated discussions regarding application of its innovative separation technology to remove thorium from various mineral deposits and the use of its innovative stripping technology in certain commercial SX plants.  

Advantages of Patent-Pending, Zero-Discharge SX Separation Technology  

Pilot plant data indicates the following economic advantages of the new SX separation technology with regard to both capital and operating costs:  

• Process improves upon conventional SX technology that is already used in numerous, commercial-scale operations;
• The number of mixer/settlers necessary for cerium and thorium removal is significantly less than traditional SX;
• The reduced mass going to advanced separation due to the early recovery of cerium and lanthanum is expected to improve the Project economics associated with recovering the more valuable rare earths;
• The efficiency of the stripping process represents a significant improvement over traditional SX, including the complete elimination of any acid-stripping mixer/settlers;
• Using commercially available reagents and no strong acids for stripping eliminates the need for a neutralization plant; and
• The ability to recycle the barren organic and stripping agent is expected to reduce raw material costs.  

SGS-Lakefield, Canada executed the SX pilot and bench-scale test work under the direction of Dr. Henry Kasaini, Rare Element Resources’ Director of Science and Technology.  The SX pilot plant was run at a throughput of 8kg/day using the 98%-pure, total rare earth oxide concentrate generated from previous recovery testing. The Company adopted a modular approach to design, construct and operate the SX plant to focus on the early removal of cerium, thorium and lanthanum to reduce the capacity necessary for advanced separation.  Final assays provided by SGS to the Company were consistent with the preliminary results reported in the October 14, 2015 press release entitled, “Rare Element Resources Successfully Completes First Phase of Pilot Plant Testing of Patent-Pending, Zero-Discharge SX Separation Technology” available on the Company’s website at www.rareelementresources.com.  

Rare Element Resources Ltd. is a publicly traded, strategic materials company focused on delivering rare earth products for technology and defense applications by advancing the Bear Lodge Critical Rare Earth Project in northeast Wyoming.  Bear Lodge is a significant mineralized district containing many of the less common, more valuable, critical rare earths that are essential for electronics, fiber optics, laser systems for health and defense, as well as many evolving green technologies, like hybrid cars, solar panels and wind turbines. Permitting and feasibility work on the Project continues to advance.  The Company is an affiliate member of the U.S. Department of Energy’s Critical Materials Institute, a combined government and private sector organization committed to eliminating supply chain issues for rare earths and other critical elements.

Please contact Robbin Lee at 720-278-2462, or rlee@rareelementresources.com, for additional information.

Jaye T. Pickarts, P.E. and Chief Operating Officer of Rare Element Resources, is a qualified person under Canadian NI 43-101 and supervised the preparation of the technical information in this press release.

Forward Looking Statements

This news release contains forward-looking statements within the meaning of securities legislation in the United States and Canada. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements. Forward-looking statements are usually identified by our use of certain terminology, including "will", "believes", "may", "expects", "should", "seeks", "anticipates", "plans", "has potential to", or "intends" or by discussions of strategy or intentions. Such forward-looking statements include statements regarding current and expected future results of pilot plant test work and its economics, the potential for conducting further test work, timing of such test work and the results, if conducted, anticipated timing and outcome of our federal, state and local permitting efforts, and overall progress of the Bear Lodge Project.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results or achievements to be materially different from any future results or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, the progress of our Bear Lodge Project, fluctuations in demand for, and price of, rare earth products; timing of and unexpected events at the Bear Lodge property; delay or failure to receive government approvals and permits; changes in U.S. and Canadian securities markets; our ability to obtain financing and general economic conditions. There can be no assurance that future developments affecting the Company will be those anticipated by management. Please refer to the discussion of these and other risk factors as set out in our filings made from time-to-time with the U.S. Securities and Exchange Commission and the Canadian securities regulators, including without limitation, the Company’s most recent reports on Form 10-K and Form 10-Q. We do not undertake to update any statements or estimates at any particular time or in response to any particular event, other than in accordance with applicable law.  Investors and other should not assume that any forecasts in this news release represent management’s estimates as of any date other than the date of this news release.