Rare Element Resources Ltd.
TSX : RES
NYSE Amex : REE

Rare Element Resources Ltd.

December 21, 2011 16:30 ET

Rare Element Reports Additional Drilling Results and Progress With Pilot Plant Testing

VANCOUVER BRITISH, COLUMBIA--(Marketwire - Dec. 21, 2011) - Rare Element Resources Ltd. (TSX:RES)(NYSE Amex:REE) is pleased to announce rare earth element (REE) assay results from 10 additional drill holes completed during its 2011 core drill program at the Company's 100% owned Bear Lodge property, located in northeastern Wyoming, USA. These results include 3 drill holes from the Bull Hill Resource Area, 4 drill holes from the Bull Hill West Target, and 3 drill holes from the Whitetail Ridge Area. These are the first results reported from the recently recognized Bull Hill West area. The Company also reports on the successful pilot plant testing recently completed.

Dr. Jim Clark, Vice President-Exploration, states, "The current results indicate that the Bull Hill mineralized zone may continue to the west into the Bull Hill West Target area, and the next resource estimate should reflect this expansion of the Bull Hill deposit resource. Similarly, the results from Whitetail Ridge also indicate a probable significant expansion of that resource. We continue to be encouraged by the upside potential of the Bear Lodge REE District."

Highlights from the recently received drill holes include the following intercepts:
Bull Hill and Bull Hill West
RES11-09 - 71.5 feet @ 2.64% TREO (total rare earth oxide)
RES11-39 - 172 feet @ 2.77% TREO
29.5 feet @ 3.89% TREO
68 feet @ 2.31% TREO
72 feet @ 3.71% TREO
32.5 feet @ 2.99% TREO
64.5 feet @ 3.71% TREO
RES11-42 - 37 feet @ 2.03% TREO
129.5 feet @ 4.02% TREO
43.5 feet @ 2.44% TREO
Whitetail Ridge
RES11-30 - 18.5 feet @ 2.13% TREO
25 feet @ 2.44% TREO
89.5 feet @ 3.64% TREO
RES11-45 - 60.5 feet @ 4.79% TREO
21 feet @ 2.72% TREO
24 feet @ 2.22% TREO

Drilling Results

Rare earth mineralization intersected in the 10 drill holes is primarily contained within the near-surface oxidized (FMR) and oxidized but incompletely leached (oxide carbonate/OxCa) equivalents of carbonatite dikes. These dikes are widespread in the district and concentrated in dike swarms and stockwork zones on Bull Hill, Bull Hill West and Whitetail Ridge (Figure 1). FMR refers to the major constituents of the highly oxidized, former carbonatite dikes that occur in the depth range from the surface to 300-500 feet beneath the surface-F (FeOx)-M (MnOx)-R (REE minerals). Maps for the corresponding drilling areas will be on the Company's website at www.rareelementresources.com.

Bull Hill Resource Area and Bull Hill West Target Area

The seven holes in the Bull Hill Resource Area were drilled along a prescribed NE-SW grid at an azimuth of 045º. Three holes were drilled to test the eastern and southeastern limits of the main Bull Hill deposit and four holes were drilled to expand the resource to the west across the drainage in the Bull Hill West area (Figure 1). Highlights from the Bull Hill area drill holes are summarized in Table 1 below.

Table 1. Significant assay intercepts from the Bull Hill Resource Area
Drill hole RES11-09 (045º, -45º; t.d. 551 feet) (site 10-F; section 8NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
63 134.5 71.5 50.6 FMR (Oxide) dikes and stockwork 2.64
208 227 19 13.4 FMR (Oxide) dikes and stockwork 2.05
Drill hole RES11-19 (045º, -58º; t.d. 1,206 feet) (site BH11-05; section 8SE)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
461 467 6 3.12 FMR (Oxide) dikes and stockwork 2.22
478 488.5 10.5 5.46 FMR (Oxide) dikes and stockwork 2.42
501 510 9 4.68 FMR (Oxide) dikes and stockwork 2.22
600 604 4 2.08 FMR (Oxide) dikes and stockwork 2.77
631 636 5 2.6 FMR (Oxide) dikes and stockwork 3.34
1178 1190 12 6.24 Carbonatite stockwork and dikes 2.12
Table 2. Significant assay intercepts from the Bull Hill West Target
Drill hole RES11-35 (045º, -45º; t.d. 700.5 feet) (site BH11-13; section 8NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
179 183 4 2.83 FMR (Oxide) stockwork and dikes 3.93
Drill hole RES11-39 (045º, -45º; t.d. 1,344 feet) (site BH11-10; section 2NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
224 242.5 18.5 13.08 FMR (Oxide) dikes stockwork 2.62
299 471 172 121.6 FMR (Oxide) dikes and stockwork 2.77
11.5 Includes 12.23
629 637 8 5.66 OxCa dikes and stockwork 2.26
716 745.5 29.5 20.86 OxCa dikes and stockwork 3.89
762 766.5 4.5 3.18 OxCa dikes and stockwork 2.83
833.5 839 5.5 3.89 OxCa dikes and stockwork 2.10
861 929 68 48.08 OxCa dikes and stockwork 2.31
940 1012 72 50.9 OxCa dikes and stockwork 3.71
20 Includes 6.19
1045 1077.5 32.5 22.98 OxCa dikes and stockwork 2.99
1142.5 1207 64.5 45.6 Carbonatite dikes and stockwork 3.00
Drill hole RES11-42 (045º, -45º; t.d. 1,144 feet) (site BH11-08; section 2SE)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
196.5 206 9.5 6.72 FMR (Oxide) dike and stockwork 2.44
481 486.5 5.5 3.89 FMR (Oxide) stockwork 2.61
581 591 10 7.07 OxCa dike and stockwork 9.02
789 826 37 26.16 OxCa veins and stockwork 2.03
891.5 1021 129.5 91.56 OxCa dike 4.02
17 Includes 6.19
1038 1081.5 43.5 30.75 OxCa veins and stockwork 2.44
1131 1134 3 2.12 Carbonatite stockwork 3.28

Whitetail Ridge

Rare earth mineralization in and adjacent to the Whitetail Ridge Resource Area occurs in dominantly NW-trending dikes, veins, and stockwork zones. The highlights from the Whitetail Ridge area drill holes are summarized in Table 3 below.

Table 3. Significant assay intercepts from the Whitetail Ridge Resource Area
Drill hole RES11-24 (045º, -45º; t.d. 734 feet) (site WT3; section 21NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
172.5 181 8.5 6.01 OxCa dike 2.90
282 285 3 2.12 OxCa dike 7.12
307 311.5 4.5 3.18 OxCa stockwork 3.42
317.5 321 3.5 2.47 OxCa stockwork 2.07
Drill hole RES11-30 (180º, -45º; t.d. 622 feet) (site WT11-06; section 24NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
18 36.5 18.5 13.08 FMR (Oxide) stockwork 2.13
66 78 12 8.48 FMR (Oxide) stockwork 2.07
104 116 12 8.48 FMR (Oxide) vein and stockwork 2.07
268 283 15 10.61 FMR (Oxide) dike 3.68
387 412 25 17.68 FMR (Oxide) dike and stockwork 2.44
443 448 5 3.54 OxCa veins 2.10
488 494 6 4.24 FMR (Oxide) stockwork 2.11
527 616.5 89.5 63.28 OxCa dikes and stockwork 3.64
Drill hole RES11-45 (180º, -55º; t.d. 1,186 feet) (site WT11-06; section 24NW)
Interval
From
(ft)
Interval
To
(ft)
Intercept
(ft)
Est. true
thickness
(ft)
Mineralized lithology TREO
(%)
25.5 35 9.5 5.42 FMR (Oxide) stockwork 2.10
99 103.5 4.5 2.57 FMR (Oxide) dike 3.76
281 341.5 60.5 34.49 FMR (Oxide) veins and stockwork 4.79
17 Includes 8.91
374 395 21 11.97 FMR (Oxide) dike and stockwork 2.72
457 462 5 2.85 OxCa veins and stockwork 2.56
484 494.5 10.5 5.99 OxCa dike 2.57
510.5 521 10.5 5.99 OxCa veins and stockwork 2.53
569.5 593.5 24 13.68 OxCa dike and stockwork 2.22

REE assay values are reported by convention as the combined oxide equivalents (REO) of the fifteen elements in the lanthanide series + yttrium. The Bull Hill deposits at the Bear Lodge project contain predominantly the "light" REE (lanthanum, cerium, praseodymium, neodymium, and samarium), with economically important quantities of several of the "heavy" REE (europium, dysprosium, and terbium). The Whitetail Ridge Resource area and other nearby targets have more abundant HREE enrichment, with enhanced abundances of Eu, Dy, Tb, and Y (see news release dated 4 August 2011).

Pilot Plant

In addition to the drilling results, Rare Element also reports that two pilot plant metallurgical test campaigns were completed in 2011. The pilot plant tested an economical ore processing method. The results from the test runs are being analyzed in detail and will be announced in early 2012. Additional testing is being planned and will be used to assist in the development of design criteria that can be used to scale up to commercial-scale operating levels.

Jaye T. Pickarts, Chief Operating Officer, stated, "We are very pleased with the progress that we made on the pilot plant and its results to date. We have been able to run multiple tests at the pilot plant and these data will enable us to configure the optimal operating system going forward. As we analyze the data and conduct more pilot plant test runs next year, we anticipate more good news from the Company on metallurgical and operational results."

The pilot plant tested a total of approximately 9 tons of high grade REE and 4 tons of stockwork REE. The high-grade REE mineralized material graded between 4 and 8% REO (rare earth oxide) while the stockwork REE mineralized material graded between 2 and 4% REO. The initial results have been promising and these results will be incorporated into the PFS (pre-feasibility study) that is scheduled for release in the first quarter of 2012.

Several hundred kilograms of RE (rare earth) carbonate concentrate were produced through the pilot plant testing process. This concentrate material will be used in our marketing efforts with companies that have expressed interest in partnering with Rare Element Resources to gain access to RE concentrates.

Assays, Quality Control, and Standard Certification

ALS Chemex conducted the assaying for the rare earth elements reported here in their Vancouver, British Columbia assay facility. ALS Chemex Vancouver is accredited to ISO 9001 and operates according to ALS Group standards consistent with ISO 17025 methods at other laboratories. The samples were prepared and subjected to lithium metaborate fusion, followed by ICP analysis and a mass spectroscopy finish.

Analytical quality is monitored through the use of randomly inserted quality control samples, including standards, blanks, and duplicates, which are blinded to the analytical laboratory. Results of the analyses at ALS Chemex are evaluated continuously by Dr Jeffrey Jaacks, the Company's QA/QC consultant, who is a Qualified Person according to National Instrument 43-101. The results from the current data set indicate acceptable accuracy and precision. Blank analyses also indicate no issues with carry-over contamination.

Rare Element Resources Ltd (TSX:RES)(NYSE Amex:REE) is a publicly traded mineral resource company focused on exploration and development of rare-earth elements and gold on the Bear Lodge property.

Rare-earth elements are key components of the green energy technologies and other high-technology applications. Some of the major applications include hybrid automobiles, plug-in electric automobiles, advanced wind turbines, computer hard drives, compact fluorescent light bulbs, metal alloys, additives in ceramics and glass, petroleum cracking catalysts, and a number of critical military applications. China currently produces more than 95% of the 130,000 metric tonnes of rare-earths consumed annually worldwide, and China has been reducing its exports of rare earths each year. The rare-earth market is growing rapidly, and is projected to accelerate if the green technologies are implemented on a broad scale.

For additional information, please refer to the Company's website at www.rareelementresources.com.

Donald E. Ranta, PhD, PGeo, serves the Board of Directors of the Company as an internal, technically Qualified Person. Technical information in this news release has been reviewed by Dr. Ranta and has been prepared in accordance with Canadian regulatory requirements that are set out in National Instrument 43-101. This news release was prepared by Company management, who take full responsibility for content.

Forward Looking Statements

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", "has potential to", or "intends' or by discussions of strategy or intentions. 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. Forward-looking statements are statements that are not historical facts, and include but are not limited to, estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to the effectiveness of the Company's business model; future operations, products and services; the impact of regulatory initiatives on the Company's operations; the size of and opportunities related to the market for the Company's products; general industry and macroeconomic growth rates; expectations related to possible joint and/or strategic ventures and statements regarding future performance.

Forward-looking statements used in this discussion are subject to various risks and uncertainties, most of which are difficult to predict and generally beyond the control of the Company. If risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. Forward-looking statements in this document are not a prediction of future events or circumstances, and those future events or circumstances may not occur. Given these uncertainties, users of the information included herein, including investors and prospective investors are cautioned not to place undue reliance on such forward-looking statements.

To view Figure 1. The Bear Lodge REE district showing the location of the Bull Hill, Whitetail Ridge, and East Taylor REE-mineralized areas, please visit the following link: http://media3.marketwire.com/docs/Figure1_Bull_Hill.pdf.

To view Figure 2. Drill hole location map, please visit the following link: http://media3.marketwire.com/docs/Figure2_Drill_Hole_Location.pdf.

Neither Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this release.

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