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Rare Element Resources upgrades resource at Bear Lodge to indicated, boosts overall size

|Includes: Rare Element Resources Ltd. (REE)

Rare Element Resources (AMEX:REE) (TSE:RES) announced late Tuesday that it has significantly upgraded and increased the overall size of the resource at its Bear Lodge rare earth project in Wyoming, with three of the site's deposits also showing potential for further expansion.

Rare-earth elements are key components of green energy technologies, used in everything from hybrid automobiles, to advanced wind turbines and computer hard drives. China currently produces more than 96% of the 130,000 tonnes of rare-earths consumed worldwide each year, but has recently begun reducing its export quotas, making the metals more and more critical.

The rare earth explorer's new estimate, conducted by Ore Reserves Engineering, was based on data from 86 core drill holes completed by the company between 2008 and 2010, for a total of 19,093 metres. These new holes were substituted for those drilled before 2008, as well as for those completed prior to 2004 by other companies, Rare Element said.

The three deposits in focus were the Bull Hill Southwest, which contains the bulk of the current resources, the Bull Hill Northwest and the Whitetail Ridge.

According to the NI 43-101 compliant updated report, a total of 4.9 million tons were estimated in the indicated category at a grade of 3.77% rare earth oxides (REO), increasing the total pounds of REO contained in the Bull Hill high grade deposits by 20%, from 1,210 pounds to 1,450 pounds, at a 1.5% REO cut-off grade.

In addition, 17.8 million tons of inferred resources were established, at a grade of 3.03% REO.

All of the indicated resource, and 11.65 million tons of the inferred resources are near-surface oxide and oxide-carbonate mineralization, the company said.

In comparison, the previous estimate from May 2010 indicated only an inferred mineral resource of 17.5 million tons, averaging 3.46% REO.

"The Bear Lodge project is advancing rapidly. The current upgraded resource, plus additional resources planned for upgrade during the 2011 drill program, will be included in a Preliminary Feasibility Study scheduled for completion in late 2011 or early 2012," said president Dr. Don Ranta.

Indeed, the company's 2011 exploration program is planned to include more than 50 infill and step out holes to further upgrade and expand this resource. Rare Element is also expecting results from its pilot plant metallurgical test this year as it advances its commercial process.

The company said that drilling so far has shown expansion potential in the three deposits on which the resource model was based, specifically at Bull Hill Southwest, which is open at depth, to the southeast and to the northwest.
 
There is also potential for mineralization to be found in the undrilled areas between the targets, as well as in additional areas, such as Bull Hill West and the Carbon Rare Earth Element zone.