rare-earth elements - Hard Assets Rare Earths Investment Summit

RARE-EARTH ELEMENTS 

& GOLD 

NYSE AMEX: REE 

TSX: RES 

REEs 

A Look at the Road Ahead 


TSX: RES 

1

Disclaimer 


TSX: RES 

• The information contained herein, while obtained from sources which we believe are reliable, is not guaranteed as to 

its accuracy or completeness. The company is an exploration company and its mineral project has yet to be proven to 

be economic. Some references to geologic and technical information contained herein are historical or have been 

generated by external consultants who may or may not be QPs under NI 43-101 and are therefore not in accordance 

with the requirements under NI 43-101 or have to be prepared in accordance with a preliminary or final feasibility 

study. The content of this presentation is for information purposes only and does not constitute an offer to sell or a 

solicitation to purchase any securities referred to herein. 

• Forward-looking statements: This presentation includes certain forward-looking statements about future events 

and/or financial results which are forward-looking in nature and subject to risks and uncertainties. Forward-looking 

statements include without limitation, statements regarding the company’s plan, goals or objectives and future mineral 

projects, potential mineralization, resources and reserves, exploration results and future plans and objectives of Rare 

Element Resources. Forward-looking statements can generally be identified by the use of forward-looking terminology 

such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, or “continue” or the negative thereof or 

variations thereon or similar terminology. There can be no assurance that such statements will prove to be accurate 

and actual results and future events could differ materially from those anticipated in such statements. Important 

factors that could cause actual results to differ materially from expectations include risks associated with permitting, 

mining generally, and pre-development stage projects in particular. Potential investors should conduct their own 

investigations as to the suitability of investing in securities of Rare Element Resources. 

• Cautionary Note to U.S. Investors Concerning Estimates of Measured, Indicated and Inferred Resources 

This presentation uses the term “Inferred” Mineral Resources. U.S. investors are advised that while such terms are 

recognized and required by Canadian regulations, the Securities and Exchange Commission does not recognize them. 

“Inferred Resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their 

economic and legal feasibility. It cannot be assumed that all or any part of an inferred resource will ever be upgraded 

to a higher category. Under Canadian rules, estimates of Inferred Resources may not form the basis of feasibility or 

other economic studies. U.S. investors are also cautioned not to assume that all or any part of an Inferred Mineral 

Resource exists, or is economically or legally mineable. 

2

Current Status - REEs 


TSX: RES 

• China accounts for ~96% of the world’s current REE production 

• Currently believed to be operating at or near capacity 

• Reducing exports year-on-year 

• Attempted to acquire the two most advanced projects outside China 

• Potential importer of rare earths in 5 - 6 years 

• Problem with lack of transparency in reserves and future plans 

• No significant non-Chinese supply sources currently available 

• Small and limited production - Russia, India, and California 

• Two rare-earth operations being constructed outside China: 

• Development-stage projects - production in late 2012 & 2013 

• Mt. Weld, W. Australia – Lynas Corporation 

• Mountain Pass, California – Molycorp 

• Others at earlier stages with longer lead times to production 

• New projects – technical, economic, and environmental hurdles 

3

Chinese Policies and Production 


TSX: RES 

• China wants to create major wind turbine, solar panel, and electric car industries 

Chinese Government Policy 

• Strategic value of REO well understood 

• Export quotas declining annually 

• -10% since 2004 to 59,600t in 2007 

• -6% to 56,900t in 2008 

• -12% to 50,100t in 2009 

• -40% to 30,300t in 2010 

• -7% ? to ~28,000 in 2011 

• Raised export tariffs to 15-25% 

• Key interest in maintaining long-term 

domestic supply for the Chinese 

manufacturing industry 

• Pressure high-tech companies that need 

these REE to relocate production to China 

Source: Metal-Pages 

Chinese Production Limits 

• Largest REO mine - Bayan Obo (50% of 

world supply) probably operating at or 

near capacity 

• REO is a by-product of iron mining 

• Future ore selection forecast to result in 

lower REO grades 

• Sichuan 

• Environmental issues 

• Underground mining 

• Jiangxi, Guangdong, Hunan, Fujian 

• Fragile resource due to over exploitation 

• Fragile environment due to mining methods 

• Limited reserves 

4

Looking Ahead at REE Market 


TSX: RES 

• China will account for a decreasing share of the world’s REE 

production 

• Lynas Corp. and Molycorp expected to be in production by 2012 / 

2013 and progressing to their stated capacities 

• Hurdles to other potential REE producers: 

• Decreasing prices as supply begins to meet demand 

• Grades and value per ore tonne for some deposits too low 

• Either high Nd-Pr grades or favorable HREE grades 

• Good metallurgy and high grade of mineral concentrate 

• Logistical and infrastructure challenges 

• Environmental challenges due to thorium content 

• Technology of REO separation 

• High capital costs of mine & plant construction 

5

Advanced-Stage Projects 

Being Evaluated 


TSX: RES 

Other projects with longer lead times to production: 

• Steenkampskraal, South Africa – Great Western 

• Bear Lodge, Wyoming – Rare Element 

• Nolans Bore, Australia – Arafura 

• Zandkopsdrift, South Africa – Frontier 

• Eldor, Quebec – Commerce 

• Sarfartoq, Greenland – Hudson 

• Nechalacho, NWT – Avalon 

• Strange Lake, Quebec – Quest 

• Kvanefjeld, Greenland – Greenland Minerals 

• Dubbo, Australia – Alkane 

• Bokan, Alaska – Ucore 

• Norra Karr, Sweden – Tasman 

• Kipawa (Zeus), Quebec – Matamec 

6

Rare Element Resources 

Why the Bear Lodge Project? 


TSX: RES 

• 2 nd highest grade rare-earth deposit in North America 

• Excellent distribution of elements (rich in Nd, Pr, Eu, Tb, Dy) 

• Simple low-cost metallurgical processing 

• Exceptional infrastructure 

Financial Information 

• 44.1M shares outstanding (47.9M FD) 

• Market cap of $240M 

• ~$63M in cash on hand, no debt 

• 52 week H/L of $17.92/$3.86 

• Insiders hold 5.8% 

7

Rare Element Resources Projects 


TSX: RES 

Bear Lodge Property, Wyoming, USA 

• Indicated Rare-Earth mineral resource (NI 43-101-compliant) 

• 4.9 million tons @ 3.77% REO (1) 

• Inferred Rare-Earth mineral resource (NI 43-101-compliant) 

• 17.8 million tons @ 3.03% REO (1) 

Preliminary Economic Assessment completed - 40% IRR 

• Carbonatite deposit - same type as Bayan Obo and Mountain Pass 

• Property 100% controlled & metallurgical process outlined 

Sundance Project, Wyoming, USA 

• Cripple Creek-style gold target 

• 947,000 oz inferred Au resource: 76 mm tons @ 0.0125 opt (2) (0.42 gpt) 

(NI 43-101 compliant) 

• Excellent potential for more resources of near-surface and higher grade gold 

(1) 1.5% REO cut-off-grade; prepared by Ore Reserves Engineering, June, 2011 

(2) 0.005 opt Au cut-off grade; prepared by Ore Reserves Engineering, March 2011 

8

Scoping Study Highlights 


TSX: RES 

Pricing basis - RE bulk concentrates 

Base Case 

3-year trailing average price 

($5.51/kg thru Aug 2010) 

Production rate 1,000 tpd 

Mine life 15 years (5M tons) 

Initial capital $87M 

Operating cost $213/ton 

LOM sustaining capital $88M 

REO recoveries to concentrates (23,700 tonnes conc.) 80% 

Annual tons REO in concentrates (10,300 tonnes REO) 11,400 tons 

Annual payable value of REO $143M 

Annual operating cash flow $50M 

Internal rate of return (IRR) 40% 

After tax LOM cash flow (undiscounted) 

After tax net present value (NPV) 

$598M 

10% discount rate $213M 

15% discount rate $131M 

Payback 3.1 years 

Concentrate prices: 3-year trend average $5.51/kg; 3.75-yr average $14.45/kg; current price of $38/kg 

Concentrates contain 42-45% REO (~43.5%) 

NI 43-101 Scoping Study (PEA) prepared by J.T. Boyd Company, November 2010 

9

Bear Lodge 

Location and Infrastructure 

Excellent Mining 

Infrastructure 

• Paved road within 2 miles of 

project 

• Low-cost power within 1 mile of 

project 

• 40 miles to nearest railhead 

• Skilled labor and water available 

• Favorable community 

acceptance; Major coal mining 

center 60 miles W 

• Top ranked mining jurisdiction (1) 

(1) Wyoming ranked as one of the top worldwide locations favorable for mining by the Fraser Institute 


TSX: RES 

10

Bear Lodge 

Rare-Earths Overview 


TSX: RES 

• Contains “one of the largest deposits of disseminated (low-grade) 

rare earths in North America” plus high-grade zones (US Geological 

Survey (2) ); USBM historic resource estimate 

• Indicated mineral resource - 4.9 mm tons @ 3.77% REO (1) of oxide, 

Inferred mineral resources of 17.8 mm tons @ 3.03% REO (1) 

including oxide zone of 11.6 mm tons @ 3.22% REO (NI 43-101) 

• Exploring for additional oxidized REE mineralization in the Bull Hill area 

carbonatites within 500 feet of surface 

• Low-cost simple metallurgical process for near-surface oxide 

mineralization; Pilot Plant in progress; 

• Preliminary Feasibility Study in progress 

(1) NI-43-101 compliant using 1.5% REO cut-off-grade; prepared by Ore Reserves 

Engineering, June 2011 

(2) US Geological Survey (Staatz, Professional Paper 1049-D, 1983) 

11

Rare-Earth Drilling 


TSX: RES 

12

Bull Hill Area Drill Holes 

Carbon 

w/ HREE 

East Taylor 

w/ HREE 

Whitetail Ridge 

Resource HREE 

(USBM target) 

Target 

Bull Hill NW 

Resource 

Bull Hill West 

Bull Hill 

Bull Hill 

Resource 


TSX: RES 

7 Target Areas 

Only Bull Hill 

well drilled 

Large areas of 

adjacent 

low-grade (1%) 

stockwork REE 

13

Dike-Swarm Section - Bull Hill 

Plug? 

Old holes 

Low-grade 

2008-11 holes 

High-grade 

REE in 

Dikes Low-grade 

Indicated Mineral Resource 

4.9 million tons @ 3.77% REO 

(compliant with NI 43-101) 

Plus Inferred Resources 


TSX: RES 

14

2010 Drilling Results 

REE - Selected Intervals 


TSX: RES 

Hole Oxide/Non Thickness Total Rare Earth Oxides 

RES 09-21 oxide 93 ft 4.08% 

oxide 59 ft 8.79% 

oxide / trans. 96 ft 5.59% 

RES 10-01A oxide 97 ft 6.57% (step-off) 

RES 10-04 oxide / trans 163 ft 4.64% (step-off) 

RES 10-07 oxide 97 ft 8.43% (step-off) 


RES 10-28 oxide 183 ft 3.55% 

RES 10-34 oxide 161 ft 4.10% 

RES 10-37 oxide 76 ft 10.01% 

RES 10-39 oxide 102 ft 4.20% 

oxide 99 ft 4.25% 


15

2011 Drilling Results 

REE - Selected Intervals 


TSX: RES 

Hole Oxide/Non Thickness Total Rare Earth Oxides 

RES 11-10 WR oxide 32 ft 3.94% (step-off) 

oxide 44 ft 3.27% (step-off) 

oxide / trans 27 ft 4.68% (step-off) 



oxide / trans 115 ft 3.38% (step-off) 

RES 11-22 oxide 26 ft 4.17% 

oxide 64 ft 5.48% 

oxide / trans 79 ft 3.96% 

RES11-25 WR oxide 108 ft 3.81% (step-off) 

RES11-26 ET oxide 42 ft 4.15% 

RES11-26A ET oxide 19 ft 3.30% 

16

Bull Hill REE Mineralization - 

FMR Dikes & Veins 

This image cannot currently be displayed. 

Bull Hill Diatreme 

Breccia ~1% 

Low-grade REO 


TSX: RES 

OXIDE Zone Mineralization - FMR 

with Bastnasite-group Minerals 

(light brown) High-grade REO 

17

Metallurgical Flowsheet 

Mineral 

Concentration 

(~ gravel wash plant) 

Preconcentrate 

90% recovery 

Chemical 

Concentration 

RE Carbonate 

Concentrate 

Overall 80% recovery 

(Oxide Mineralization) 


TSX: RES 

18

Mineral Concentration 

Pilot Plant 

+ 1 inch 

Coarse Reject 

10m x 48m Fine Middling 


TSX: RES 

1 inch x 10m Coarse Middling 

Pre-concentrate 

1 in x 10 m 

Recycle 

19

Chemical Concentration 

Pilot Plant 


TSX: RES 

Acid Addition Pre-concentrate Feed HCL Leaching 

Iron Hydroxide Precipitation REO Carbonate Precipitation Filtration 

20

Oxide Zone Distribution of REE 

Rare-Earth 

Element 

Wt-% Oxide 

Distribution (1) 

% Relative Value(2) 

Lanthanum 28.6% 19.6% 

Cerium 43.5% 15.3% 

Neodymium 17.2% 31.0% 

Praseodymium 4.9% 8.7% 

Samarium 2.6% 1.1% 

Europium 0.6% 17.1% 

Gadolinium 1.3% 0.8% 

Terbium 0.1% 2.7% 

Dysprosium 0.3% 3.0% 

Yttrium 0.8% 0.6% 

Total 99.9% 99.9% 

(1) From 43-101 resource estimation model of indicated category, ORE, June 2011 

(2) Based on 2010 average prices of REEs from January through August 


TSX: RES 

Bull Hill Deposit 

“Big 5” - most 

important and 

valuable 

elements for 

magnets – Nd, 

Pr, Tb, Dy & CFL 

–Eu, Tb 

23% of total 

distribution but 

over 62% of 

value 

21

Exploration Deposits & Targets 

HREE 

HREE 

Target? 

LREE 


TSX: RES 

Bear Lodge 

Rare-Earth 

District 

2010 drill holes 

Main resource 

at Bull Hill 

HREE targets to 

the West 

22

Bear Lodge REE Geology 


TSX: RES 

Bear Lodge 

REE District 

High-grade 

REO shown as 

FMR in dark 

MnOx dikes 

Soil cover 

masks some 

geology 

23

Milestones 

• Completed 

√ 2004-2009: Drilled 32 core holes 

in REE mineralization, + 23 

historic holes, favorable met test 

results, estimated resources 

√ 2010: Updated resource 

estimate; drilled 60 holes + 40 

large diameter holes for bulk 

sample; positive Scoping 

Study (PEA) on oxides, $66M 

financings 

√ 2011: Updated resources 

estimate, drilled 63 holes, 

continued met testing, began 

pilot plant testing 

• Upcoming 


TSX: RES 

– Q4 2011: Collect environmental 

baseline data; pilot plant tests 

on 10-ton bulk sample 

– Q1 2012: Complete 

Preliminary Feasibility Study 

– Q1 2012: Market products from 

pilot plant tests; initiate mine 

permitting; continue tests for 

extraction and separation of REEs 

24

Appendix 

Thank You 


TSX: RES 

25

Proven Management Team 


TSX: RES 

Donald E. Ranta, PhD, PGeo, President, CEO & Director 

• 40 years of leadership in exploration and project evaluation 

• Previously at Echo Bay, Phelps Dodge, AMAX, Kennecott 

Jaye T. Pickarts, P.E., Chief Operating Officer 

• 25 years’ experience in project evaluation and production 

• Previously at Knight Piesold, Pegasus, Texasgulf, Freeport 

David Suleski, CPA, Chief Financial Officer 

• 25 years of leadership as CFO, treasurer, controller, & in financings 

• Previously at Atna, Golden Star, Rothschild, Apex, Cyprus-Amax, 

PWC, E & Y 

James G. Clark, PhD, LGeo, VP Exploration 

• Rare-earth geology expert with 30 years experience 

• Previously at Molycorp and Hecla Mining 

George G. Byers, M.A., VP Government & Community Relations 

• 35 years’ experience in successful project development 

• Previously at Santa Fe Pacific Gold, Rio Algom, Cameco 

26

Directors & Strategic Advisors 

Directors: M.N. Anderson, Chairman 

• M. Norman Anderson, PEng, Past Chairman & CEO, Cominco 

• Mark Brown, C.A., President, Pacific Opportunity Capital 

• Norman W. Burmeister, P.E., President & CEO, Saratoga Gold 

• Gregory E. McKelvey, PGeo, consullting geologist 

• Paul Schlauch, retired partner, Holland & Hart 

Advisors: 

• Jefferey D. Phillips, President of Global Market Development 

• Dr. Anthony Mariano, consulting mineralogist & geologist 

• Stephen P. Quin, PGeo, President & CEO, Midas Gold 

• Robert Bishop, investor and former newsletter writer 

• William H. Bird, PhD, PGeo, President of Medallion Resources Ltd. 

• David Beling, P.E., former Executive VP & COO of Geovic, Ltd. 

• Matt Bender, P.E., Senior Director, Newmont Mining Company 


TSX: RES 

27

Bear Lodge Project 

Technical Team 

• Dr. Tony Mariano – Mineralogy & REE geology 

• Dr. Roshan Bhappu, P.E. – Metallurgy, Mountain States R&D 

• Dudley Kingsnorth, PEng – Rare-earth markets 

• Jack Lifton – Strategy and OEM contacts 

• John Ray – REE & Gold exploration manager 

• Dr. Ellie Leavitt, PGeo – REE geology & exploration 

• James Leavitt, PGeo – Gold geology & exploration 

• Alan Noble, P.E. – Resource estimation, Ore Reserves Engineering 

• Michael Richardson, P.E. – Mining engineering, John T Boyd Co. 

• William Ahrens, P.E. – Metallurgical engineering, Mountain States R&D 

• Dr. Richard Hammen, P.E. – Extraction & separation, Intellimet 

• Thomas Kerr, PEng – Geotechnical engineering, Knight Piesold 

• Richard DeLong – Environmental & permitting, Enviroscientists 


TSX: RES 

28

What are Rare-Earth Elements? 

Rare Earths Commercial Use 

REO Price 

(USD/kg) 

Scandium Stadium Lights Not Av. 

Yttrium Lasers 11.30 

Lanthanum Electric car batteries 6.12 

Cerium Lens polishes 4.57 

Praseodymium Searchlights, aircraft parts 28.38 

Neodymium High-strength magnets 29.49 

Promethium Portable X-ray units Synthetic 

Samarium Glass 4.50 

Europium Compact fluorescent bulbs 480.00 

Gadolinuim Neutron radiography 8.43 

Terbium High-strength magnets 350.00 

Dysprosium High-strength magnets 129.50 

Holmium Glass tint Not Av. 

Erbium Metal alloys 30.00 

Thulium Lasers 790.00 

Ytterbium Stainless steal 132.00 

Lutetium None 288.42 

Source: Metal-Pages as at February 3, 2010 and at October 11, 2011 


TSX: RES 

• REE – an unusual group of metallic elements with unique properties: chemical, 

catalytic, magnetic, metallurgical and phosphorescent 

• REE – uses in high-strength magnets are in high demand – includes Neodymium, 

Praseodymium, Dysprosium and Terbium, 

Price 

11-1-11 

--- 

142.50 

64.00 

59.00 

218.50 

240.00 

--- 

101.50 

3790.00 

142.50 

3010.00 

2090.00 

--- 

--- 

--- 

--- 

--- 

21 

Sc 

39 

Y 

57 

La 

58 

Ce 

59 

Pr 

60 

Nd 

Periodic Table of REEs 

61 62 63 

Pm Sm Eu 

64 

Gd 

65 

Tb 

- Heavy Rare Earths 

- Light Rare Earths 

- Other Rare Metals 

66 

Dy 

67 

Ho 

68 

Er 

69 70 

Tm Yb 

71 

Lu 

29

Where are REE Found? 


TSX: RES 

• China accounts for ~96% of the world’s current REE production 

• Currently believed to be operating at or near capacity 

• Reducing exports year-on-year 

• Potential importer of rare earths in 5 - 6 years 

• No significant non-Chinese supply sources currently available 

• Small and limited production - Russia, India, and California 

• All REE deposits - environmentally challenging due to thorium content 

• Development projects currently in construction or study: 

• Advanced stage projects - production in late 2011 & 2012 

• Mt. Weld, W. Australia – Lynas Corporation 

• Mountain Pass, California – Molycorp 

• Others at earlier stages with longer lead times to production 

• New projects – technical, economic, and environmental hurdles 

30

Key Applications of REE 


TSX: RES 

• REE are critical and enabling for many emerging Green Energy technologies, High Tech 

applications and Defense Systems; examples include hybrid cars, plug-in hybrid electric 

vehicles, wind power turbines, computer hard drives, fluorescent lights, missile guidance 

systems, lasers and cell phones 

Energy 

Efficiency 

Environmental 

Miniaturization 

Technology 

Application Elements 

• Compact fluorescent lights 

• Weight reduction in cars 

• Higher oil refinery yields 

• Hybrid vehicles 

• Auto catalytic converter 

• Diesel additives 

• Disk drives 

• Digital cameras 

• Flat panel displays 

31

Major Applications of REE 

Hybrid Cars 

Nd-Fe-B magnets & La batteries 


TSX: RES 

Wind Turbines 

With Nd-Fe-B magnets 

32

Applications are Driving Strong 

Forecasted Demand 


TSX: RES 

• Total demand for REE is expected to grow from 125,000 tonnes in 2010, to 170,000 

tonnes by 2015, and to 255,000 tonnes in 2020; a growth rate of ~7% per year 

2008 Demand by Application 

Ceramics 

5% 

Phosphors & 

Pigments 

8% 

Magnets 

21% 

Other 

7% 

Metal Alloys 

18% 

Total = 124,000 tonnes 

Source: Dudley J Kingsnorth, IMCOA 

Catalysts 

19% 

Glass 

Additive 

10% 

Polishing 

Powder 

12% 

Growth Forecast by Application 

Application 

Growth rate 

% p.a. 

2015 demand 

tonnes 

Catalysts 0% 25,500 

Glass Additive 0% 10,000 

Polishing Powder 5-10% 25-30,000 

Metal Alloys 4-8% 36-40,000 

Magnets 10-15% 40-45,000 

Phosphors & Pigments 4-8% 13-15,000 

Ceramics 5-8% 9-10,000 

Other 8-12% 12-14,000 

Total 6-10% 170-190,000 

33

rare-earth elements - Hard Assets Rare Earths Investment Summit

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?