Rare Element Resources Ltd. (TSX:RES)(NYSE Amex:REE)(NYSE MKT:REE)
is pleased to inform investors that its unaudited consolidated
interim financial statements on Form 10-Q for the quarter ended
September 30, 2012 have been filed on www.sedar.com and
www.sec.gov.
Regarding the first quarter fiscal 2013 financial report filing,
Randall J. Scott, President and Chief Executive Officer stated,
"This quarter's expenditures were focused on our targeted 2012
drilling program, continued progress on permitting and developing
additional metallurgical data to support the start of our
definitive Feasibility Study. The quarter's drilling program
continues a successful year of supporting an expansion and upgrade
of the Bull Hill and Whitetail Ridge resources, and delineation of
the heavy rare earth element (HREE) enriched mineralization at the
Carbon target located approximately one kilometer to the northwest
of Bull Hill. The 2012 drill program of 22,000 meters will result
in an updated resources report in the first quarter of 2013. We
continue to safeguard our healthy cash balance as we position
ourselves to meet our calendar year 2013 goals."
Update on the Bear Lodge REE Project:
Project Development Work
Current development efforts are progressing as planned and
focusing on acquiring additional key information in support of a
definitive Feasibility Study, the next major project milestone,
which we expect to complete during the fourth quarter of 2013. The
current drilling program, metallurgical testwork, ongoing strategic
partner and off-take discussions, and environmental and social
impact studies are concentrated on advancing the project and
maximizing stakeholder value. We intend to start the formal portion
of the definitive Feasibility Study during the first quarter of
2013.
We expect to submit a revised Plan of Operations to the U.S.
Forest Service (USFS) before the end of 2012. This submittal will
formally start the Environmental Impact Statement (EIS) assessment
for the Project. The goal is to obtain a favorable Record of
Decision (ROD) from the USFS in 2014. The Wyoming mine permit
application is expected to be submitted in late 2013 with the goal
of receiving a permit to mine by the end of 2014. A Wyoming
Industrial Siting Permit application will also be submitted in late
2013.
Drilling
We are on track to complete at least 15,000 meters of core
drilling and 7,000 meters of reverse circulation (RC) drilling
during the 2012 drilling season. Four core drill rigs and one
reverse circulation drill rig are currently on-site. The objectives
of the drilling program in 2012 were to: (i) increase the Measured
and Indicated resources at the Bull Hill deposit; (ii) upgrade a
significant portion of the Whitetail Ridge heavy rare earth
enriched resource to the Indicated category; and (iii) delineate
the zone of HREE-enrichment at the Carbon exploration target. We
expect to provide a second update on our partial drill results
soon.
Metallurgy
A coordinated effort of Rare Element geologists and
metallurgists provided a selection of eleven sample sites that
exhibit variable mineralogy and are spatially representative of the
expanded mine pit foot print. SGS Lakefield is currently conducting
confirmatory metallurgical testwork using the current process
flowsheet.
Nagrom Research Laboratories, Perth, Australia is conducting
additional HREE testwork on sample material from the Whitetail
Ridge and Carbon areas. Physical upgrading methods have been
applied in this phase of testwork, which include gravity
concentration, flotation and magnetic separation. Based on the
results from this testwork and results from exploration drilling at
Whitetail Ridge, RER has determined that the Whitetail Ridge
resource area will be integrated into the development phase of the
project which includes the definitive Feasibility Study and
permitting timeline for the Bear Lodge REE Project. The addition of
Whitetail Ridge into the development phase may provide enhanced
project economics.
Metallurgical testwork is also underway with the Australian
Nuclear Science and Technology Organization (ANSTO). The first
phase of testwork identified that further purification processing
is required for the production of rare-earth element (REE) products
either as a mixed concentrate or as a series of defined products.
This testwork was successful in removing many of the impurities
associated with REE processing. The Company's current strategy is
to commence production of samarium, gadolinium and europium (SEG);
neodymium-praseodymium (also known as didymium); cerium products;
lanthanum products; and other HREE's, including dysprosium and
terbium. As this purification and separation work advances, we may
adjust the product suite to add or further separate additional
products. The next phase of testwork will study upgrading and
additional purification processes that will chemically achieve the
desired separated REE products. Once these tasks are successfully
accomplished, the Company plans to continue testing of separation
into individual rare earth oxides (REO). The specifications for the
individual REO will be determined by customer requirements.
First Quarter Ended September 30, 2012 Financial Highlights:
Please note that financial results published by the Company are
all stated in U.S. Dollars.
As an exploration stage company, we have no production revenues
to report. The net loss for the first quarter ended September 30,
2012 totaled $5.9 million or $0.13 per share as compared to a net
loss of $10.9 million or $0.25 per share for the same period in
2011. The $5.0 million positive variance in net loss between the
periods was due to the following:
-- Increased exploration expense of $1.5 million;
-- Higher corporate administration expense of $0.8 million due to increased
corporate administrative expenses, excluding stock-based compensation
expense, due to a full quarter of near full staffing in our Lakewood
Colorado headquarters and at our Sundance Wyoming development office;
-- Reduced stock-based compensation expense, included in corporate
administration expense, of $2.3 million due to a decrease in stock-based
compensation expense due to fewer option grants at lower share prices;
-- Positive variance in currency translation of $5.3 million due to a $1.8
million foreign exchange gain in the current quarter compared to a $3.5
million foreign exchange loss in the comparable quarter from the prior
year. The Canadian dollar strengthen by 3.6% in the current quarter
compared to the Canadian dollar weakening by 7.2% in the comparable
quarter from the prior year;
-- Negative variances in non-operating income and expenses amounted to $0.2
million.
Cash and cash equivalents, and short-term investments at
September 30, 2012 were $47.3 million compared to $51.7 million as
of June 30, 2012. The $4.3 million decrease in cash and cash
equivalents, and short-term investments was primarily due to
spending related to exploration, corporate administrative costs,
and partially offset by foreign exchange gains on our Canadian cash
balances.
The audited financial statements are available through the
Canadian securities regulatory authorities at www.sedar.com, and
with the Securities and Exchange Commission at www.sec.gov. They
are also available on the Company's website at
www.rareelementresources.com.
Rare Element Resources Ltd. (TSX:RES)(NYSE Amex:REE)(NYSE
MKT:REE) is a publicly traded mineral resource company focused on
exploration and development of rare-earth elements (REEs). In
addition to the REE exploration and evaluation efforts, the Company
controls the Sundance gold project, which is located on the same
property in Wyoming.
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", "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.
Cautionary Note to U.S. Investors - The United States Securities
and Exchange Commission permits U.S. mining companies, in their
filings with the SEC, to disclose only those mineral deposits that
a company can economically and legally extract or produce. We may
use certain terms in public disclosures, such as "measured,"
"indicated," "inferred" and "resources," that are recognized by
Canadian regulations, but that SEC guidelines generally prohibit
U.S. registered companies from including in their filings with the
SEC. U.S. investors are urged to consider closely the disclosure in
our Form 10-K which may be secured from us, or from the SEC's
website at http://www.sec.gov.
Contacts: Rare Element Resources Ltd. David Suleski
720-278-2460dsuleski@rareelementresources.com
www.rareelementresources.com