Rare Element Resources Reports Successful Confirmation and Enhancement of its Proprietary Separation Technology

LITTLETON, Colo–(BUSINESS WIRE)–Rare Element Resources Ltd. (“RER” or the “Company”) (OTCQB: REEMF) is
pleased to announce significant progress on the third-party testwork
relating to its proprietary rare earth separation technology being
conducted by Umwelt-und Ingenieurtechnik GmbH Dresden (“UIT”). UIT is an
affiliate of Synchron, a significant shareholder of the Company. RER
engaged UIT in April 2018 to validate and further enhance its
proprietary rare earth element processing technology.

UIT’s program included the validation and enhancement of the Company’s
hydrometallurgical recovery process for the physical upgrading of mined
ore, counter-current acid leaching of the upgraded concentrates and
oxalate precipitation of rare earth elements from the leachate. UIT,
which has advanced mineral and materials research capabilities in
Dresden, Germany, has reported that their test work successfully
validated the Company’s proprietary technology and process flowsheet and
identified additional opportunities for improvement.

The scope of the UIT work included the confirmation and enhancement of
processes for the downstream separation of certain rare earth elements
and compounds, particularly Neodymium-Praseodymium oxide (NdPr oxide).
This important work was done using the Company’s proprietary solvent
extraction technology with a limited number of solvent extraction and
mixer-settler stages. UIT has reported that it was successful in
optimizing the separation of NdPr oxide from +97% mixed rare earth oxide
concentrate, derived from ore obtained at the Company’s Bear Lodge
deposit in Wyoming.

RER is pleased to now move forward with a pilot plant campaign to
verify, at scale, all process steps from the hydrometallurgical process
through the final separation of NdPr oxide. The pilot plant campaign is
expected to occur during the first 9 months of 2019.

Randall J. Scott, President and CEO of Rare Element, stated, “We are
very encouraged with the testwork results and have board approval for a
path forward to complete a pilot scale confirmation and optimization of
our proprietary technology for the separation and production of
market-ready NdPr oxide. Bear Lodge remains one of the highest-grade Nd
and Pr rare earth resources in the world and is well positioned to take
advantage of the continued rapid growth in permanent magnet
manufacturing, especially for application in electric vehicles.
Furthermore, this technology, coupled with the favorable attributes of
the Bear Lodge deposit including its location in Wyoming, is expected to
provide capital and operating cost benefits.”

During 2018, the Company additionally updated its environmental baseline
data at the Bear Lodge Project, specifically the proposed Bull Hill Mine
and the nearby Upton Hydrometallurgical Plant site. This work included a
hydrological evaluation, re-activation of the two meteorological
stations, wildlife monitoring, and vegetation surveys. These
environmental studies will provide additional support to the permitting
and licensing of the Bear Lodge Project which is currently on hold
pending completion and evaluation of the UIT pilot plant campaign.

Synchron and its affiliated General Atomics companies are a privately
held group of companies engaged in advanced research, technology,
products and systems for the energy and defense sectors.

Rare Element Resources Ltd. is a publicly traded, strategic
materials company focused on delivering rare earth products for
technology, energy and defense applications by advancing the Bear Lodge
Critical Rare Earth Project in northeast Wyoming. Bear Lodge is a
significant mineralized district containing many of the less common,
more valuable, critical rare earths that are essential for high-strength
permanent magnets, electronics, fiber optics, laser systems for health
and defense, as well as many evolving technologies like hybrid cars,
solar panels and wind turbines.

Please contact Randy Scott at +1 720-278-2460 or rscott@rareelementresources.com
for additional information.

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,” “plans,”
“has potential to,” or “intends,” or by discussions of strategy or
intentions. Such forward-looking statements include statements regarding
the impact of the completed and ongoing testwork to the Company and the
Bear Lodge Project, including the ability to restart permitting of the
project following testwork completion, testwork progression plans and
timelines, and the potential ramifications and applications of its rare
earth technology. Factors that could cause actual results to differ
materially include, but are not limited to, the Company’s ability to
remain compliant with U.S. Securities and Exchange Commission (SEC)
reporting requirements, the impact of cost-conservation measures on the
project, market conditions, and other matters discussed under the
caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal
year ended December 31, 2017, and our other periodic and current reports
filed with the SEC and available on www.sec.gov
and with the Canadian securities commissions available on www.sedar.com.
There can be no assurance that future developments affecting the Company
will be those anticipated by management. Please refer to the discussion
of these and other uncertainties and risk factors set out in our filings
made from time to time with the SEC and the Canadian regulators,
including, without limitation, our reports on Form 10-K and Form 10-Q.
Any forward-looking statement made by us in this news release is based
only on information currently available to us and speaks only as of the
date on which it is made. While we may elect to update our
forward-looking statements at any time, we undertake no obligation to
publicly update any forward-looking statement, whether written or oral,
that may be made from time to time, whether as a result of new
information, future developments or otherwise.

Contacts

Rare Element Resources Ltd.
Randy Scott, +1 720-278-2460
rscott@rareelementresources.com