Rare Element Resources Ltd. announced that the U.S. Nuclear Regulatory Commission ("NRC") has completed its review and issued the Company a Source Material License. This license is necessary to allow the processing of previously stockpiled material from the Bear Lodge Project at the Company's planned processing and separation demonstration plant ("Demonstration Plant") to be built in Upton, Wyoming. The license represents a critical step that advances the project to the next stage approval with the U.S. Department of Energy's ("DOE") Office of Energy Efficiency and Renewable Energy, which is providing approximately 50% of the budgeted project costs.

The Demonstration Plant is designed to advance the Company's proprietary recovery technology, providing operational and economic data critical to the design of a commercial-scale plant. The technology has been pilot-plant tested and successfully produced commercial quality rare earth products. A consortium, led by General Atomics and including RER, has completed system and site design and detailed engineering.

With the NRC license, and subject to DOE review, federal permitting is now complete with one remaining state permit expected in August 2023. Offsite fabrication and equipment assembly have started on key, long-lead time equipment. Rare earth elements are essential to defense systems and green energy technologies, including electric vehicles and direct-drive wind turbines.

Numerous studies have been undertaken by different U.S. administrations and have identified rare earths as "critical" because they are essential to the economic or national security of the U.S. and have been identified as having vulnerable supply chains. A DOE report issued in 2022 entitled "Rare Earth Permanent Magnets: Supply Chain Deep Dive Assessment" estimated that over 85% of the world's refined supply of rare earths and 92% of the global rare earth magnet products were produced in China in 2020.