American Rare Earths announced the results of the ?Halleck Creek Scoping Study Technical Report? compiled by Stantec Consulting Services Inc. Located in the major mining hub of Wyoming, USA, the Halleck Creek project provides compelling economics and the ARR board has unanimously recommended the project advance to the next phase of development. Highlights: Under its base case 3Mtpa operating scenario, Scoping Study outlines NPV8 of USD 673.9 and NPV10 of USD 505.1m (pre-tax) at Halleck Creek, equating to an IRR of 22.5% and payback period of 2.9 years with total initial capex of USD 456.1 million (inc. USD 76.0 million contingency).

LOM average Cost (USD/kg NdPr Equivalent) = $38.38/kg, which is favorable when compared to the most recently reported USD 50/kg cash cost of NdPr by China Northern Rare Earths1 ? the world?s largest integrated producer. A full breakdown of operating costs by product is illustrated in the Project Metrics table below.

Low operating costs are attributable to favorable geology and mining economics, coupled with the beneficiation and concentration circuit (Density Separation and Wet High Intensity and Magnetic Separation (WHIMS), which provides a 10X upgrade in grade) along with good recovery/extraction via direct leaching, without the need for cracking. The recoveries are illustrated in the Project Metrics table below. The Study is based on an initial phase of 3.0 Million tonnes per annum (Mtpa) of mining to create a low capital cost for market entry and financing.

A 6 Mtpa economic case was also prepared to illustrate future potential. The project had previously evaluated mining cases of 15, 10, 7 and 5 Mtpa before settling on this 3Mtpa mining case; making the project uniquely scalable over time, given the vast resource base (540 Mt total that were modeled in scoping exercise to identify grade for mine sequencing: 180 years at 3Mtpa and 90 years at 6Mtpa). The Study was designed to include separation of individual rare earth products in Wyoming, avoiding sending a concentrate overseas and includes all capital costs to separate products (sorted by revenue % attributable).

The products include the heavy rare earths Terbium and Dysprosium as separated products, contributing 30% of revenue: 66%: Neodymium (Nd)/Praseodymium (Pr) Oxide also referred to as ?Didy? 16%: Dysprosium Oxide (Dy) 14%: Terbium Oxide (Tb) 2%: Samarium (Sm), Europium (Eu), Gadolinium (Gd) ?SEG? concentrate 2% : Lanthanum (La) Carbonate The mine plan averaged an in-situ grade of 3,805 ppm TREO, the entirety of the cash flow presented (20+ years) is limited to approximately 400 acres on Wyoming state lands, which provides a very compact footprint.

The planned design allows future optionality and enhances project economics by accelerating permitting and leveraging established infrastructure in later stages. Late in 2023 the US Treasury Department released a proposed rule for the Advanced Manufacturing Production Tax Credit, part of the Inflation Reduction Act (IRA), better known as 45X. This production tax credit, equal to 10% of the costs incurred by the producing taxpayer, seeks to incentivise the domestic production of, among other things, critical minerals, including rare earths.

The Study has applied this 10% tax credit to costs incurred during the project?s production process, with certain exclusions as detailed in the full report. A long-term price of USD 91/kg of NdPr was used based on consensus estimates from leading investment banks along with those for Tb and Dy. Low-Cost Open-Pit Mining in a Favorable Mining Jurisdiction: A strip ratio of 0.03: 1 Open-pit mining well suited to homogenous TREO grades.

Substantial pre-existing infrastructure (BNSF and UP Tier 1 railroads, I-25 highway). Mining hub with availability of skilled labor given the decline of the local coal industry. Low-cost power ($0.0349 per kWh).

Cowboy State Mine designed on Wyoming State Mineral Leases The Wyoming Department of Environmental Quality (?WDEQ?) has rigorous and comprehensive, yet well-defined processes for obtaining mining permits on state lands. Thorium and Uranium, and associated daughter products, occur in low levels in-situ naturally at Halleck Creek, approximately 68 ppm in the mineralized material. Rare Earth Element (?REE?) Bearing Allanite can be concentrated 10X using conventional technology: Up to 86% of Allanite shown to be liberated from in-situ rock mass during crushing and grinding.

Up to 93% of non-REE gangue material can be separated from the coarse REE bearing allanite. Physical separation methods shown to increase grade by approximately 10X with an 84% recovery of TREO. In-Situ TREO grades between 3,500ppm and 4,000ppm increased to 35,000ppm (3.5%) to 40,000 (4.0%).

Gravity and Dense Media Separation removes between 77% and 83% of gangue material from ore material. WHIMS can separate another 7% to 10% of non-magnetic material from paramagnetic material. Metamict structure observed in SEM micrographs of the non-refractory allanite.

Metamictization causes allanite to become amorphous and amenable to acid leaching (requires less aggressive techniques). Favorable Direct Leaching Kinetics: REE recoveries up to 87% observed when using sulfuric acid at 90oC for 6 hours. 90oC is relatively low temperature for acid-leaching processes.

Low temperatures and shorter residence times reduce the production of silica gel. Silica gel contaminates process streams and increases precipitation and filtration costs. High-temperature Acid baking not needed to ?crack?

allanite, compared with others that must heat temperatures to 1,000 oC. This affords the project a significant ESG advantage moving forward that will be quantified in future phases of work.