NI43-101Pre-Feasibility Study Report - page 559

Rare Element Resources
Bear Lodge Project
Canadian NI 43-101 Technical Report
October 9
, 2014
10135-200-46 – Rev. 0
25 Interpretation and Conclusions
25.1 General
Several companies have explored the Bear Lodge area for rare earths since the
1970s, including Duval Corporation, Molycorp, Hecla, and Rare Element (through its
wholly owned subsidiary Paso Rico (USA), Inc., now known as Rare Element). This
pre-feasibility study captures revisions to the resource estimate, the mine, PUG plant,
Hydromet plant, Tailings Storage Facility and numerous other project aspects that
have been further developed and improved upon since the update of the resource
estimate in 2013. The Qualified Persons listed herein have developed the
conclusions presented in this section.
25.2 Geology
The Bear Lodge alkaline-igneous complex hosts one of the largest disseminated
(low-grade) REE deposits in North America (M.H. Staatz, 1983, USGS Professional
Paper 1049D). The Company is focused on exploring high-grade rare earth
mineralized zones within this large low-grade mineralized system. The high-grade
zones are strongly enriched in the most valuable critical rare earths, like neodymium,
praseodymium, and europium. They contain important quantities of dysprosium,
terbium, and yttrium, as well as abundant cerium and lanthanum, the most widely
used REE. All of the known significant occurrences of REE mineralization in the Bear
Lodge area are contained within the Rare Element claim block.
Past exploration work by Duval, Molycorp, Hecla, and Rare Element shows that
potentially economic REE mineralization occurs in carbonatite dikes and their
oxidized equivalents that are concentrated in an area of about 1.5 square-miles (3.9
square kilometers) near Bull Hill, in the central part of the Bear Lodge alkaline-
igneous complex. The RE bearing dikes are hosted primarily within and adjacent to
the western margin of the Bull Hill diatreme and within the Whitetail Ridge diatreme;
both diatreme bodies consist mainly of heterolithic intrusive breccias. In the near–
surface zone of weathering and oxidation, these dikes are altered to iron (Fe) oxide-
manganese (Mn) oxide-REE-bearing bodies that are designated as “FMR” dikes and
veins. The FMR bodies are interpreted to transition at depth into unoxidized, REE-
bearing carbonatite. The FMR dikes and veins occur from the surface to a depth
range of 300 to 600 feet (about 90 to 180 meters), where they progressively transition
into unoxidized carbonatite over a depth interval of approximately 30 feet (9 meters).
The REE mineralogy exhibits predictable variation through a series of zones
delineated based on degree of oxidation and leaching of groundmass carbonate.
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