Red Hill Energy Inc.
TSX VENTURE : RH

Red Hill Energy Inc.

December 15, 2009 09:00 ET

Red Hill Energy Acquires Thor Rare Earth Property in Southwestern Nevada

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 15, 2009) - Red Hill Energy (TSX VENTURE:RH) reports that the Company has acquired the Thor Rare Earth Property, Nevada, located approximately 27 km east of the Mountain Pass Rare Earth Mine, California, which is one of the largest and richest rare earth element mines outside of mainland China. Red Hill's Thor Rare Earth Property consists of 91 recently staked mining claims (approximately 737 hectares) covering two areas described in historical government documents as containing rare earth elements (REE). Additional claims have now been staked by the Company to cover adjoining prospective ground.

The Thor Rare Earth Property in Nevada and the nearby Mountain Pass Rare Earth Mine in California have many geological similarities. Host rocks at both properties consist of a series of strongly foliated and sheared Precambrian-age gneisses and schists intruded by gneissic granite and bodies of intrusive carbonate (known as carbonatite). The carbonatite complex at the Mountain Pass Mine was discovered in the mid 1950s almost by accident as it was almost overlooked due to its low radioactivity. It was only when the US Geological Survey (USGS) identified bastnasite, a REE-enriched fluorocarbonate mineral, that it became of interest and an economic ore body was discovered.

Red Hill's Thor Property was also discovered by uranium prospectors about the same time as the Mountain Pass discovery. Published information (Nevada Bureau of Mines, 1965) indicates the Precambrian host rocks at the Thor Property are intruded by a small quartz monzonite body of Cretaceous or Tertiary age. The intrusive is a strongly radioactive vertical pipe-like body consisting of a 8 to 9 m wide central zone that contains 30% monazite and 60% apatite. Monazite and apatite are both known for containing REE metals. Additionally, USGS reports indicate that bastnasite, which is the principal REE ore mineral at Mountain Pass, may also be present at the Thor Property. Grab samples from the Thor Property are reported to contain from 1.54% to 6.81% REE metal oxides, together with substantial amounts of uranium and thorium.

REEs are of strategic value and key to 21st century industry, being employed in hundreds of technological uses ranging from mobile phones to lasers to ultra-strong magnets to aviation. China, which accounts for more than 95% of the world's REE supply, recently announced a possible ban on exports of many REE metals. As a result, Molycorp Minerals recently announced plans to resume full mining operations at the Mountain Pass Rare Earth Mine, which has been largely inactive since 2002. Historically, the very high grade bastnasite ore produced at the Mountain Pass Mine was the source of various valuable REE metals including cerium, lanthanum, samarium, gadolinium, neodymium, and europium.

The information herein was reviewed on behalf of Red Hill Energy by Chris Broili, C.P. Geo & L.P. Geo; who is an independent consultant to Red Hill Energy and a Qualified Person (QP) as defined by Canadian National Instrument 43-101.

In consideration for the Thor Rare Earth Property, Red Hill has agreed to pay the vendor (a private arm's length company registered in the province of British Columbia) US$15,000 in cash and 350,000 common shares of Red Hill Energy. The project is subject to a 2% Net Smelter Royalty of which Red Hill has the option to purchase at anytime from the private company for US$500,000 per each one percent.

ABOUT RED HILL ENERGY INC.

Red Hill Energy Inc. is a junior resource company trading on the TSX-Venture Exchange under the trading symbol RH. The Company is advancing over one billion tonnes of 100% owned coal from two Mongolian coal basins towards production. Red Hill has a full-time office in Mongolia's capital, Ulaanbaatar. Red Hill also owns a 100% interest in the Thor Rare Earth Property and the Red Lithium Property, both located in Nevada, USA.

Red Hill Energy Inc.

G. Arnold Armstrong – Chairman and CEO

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