Mr. Chris Grove reports

COMMERCE RESOURCES CORP. CLARIFIES AND CORRECTS DISCLOSURE

As a result of a review by the British Columbia Securities Commission, Commerce Resources Corp. has issued the following news release to clarify its disclosure.

On the company website the company did not prominently display the standard cautionary language that the preliminary economic assessment for the Ashram rare earth element deposit is preliminary in nature, includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and that there is no certainty the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The placement of the standard cautionary has been modified and the language is now found prominently and immediately following any reference to the Ashram REE deposit PEA on the company website.

In a corporate presentation titled "Metals for the future, tantalum, niobium and rare earth elements" dated April, 2015, the company did not include the above cautionary language with results of the Ashram PEA, nor did it specifically disclose that the Ashram REE deposit PEA economic metrics were pretax. The current Ashram technical report dated Jan. 7, 2015, explains why no after-tax case is included and that a combined tax rate of around 32.5 per cent may apply to production. All future presentations will contain standard cautionary language featured prominently following any reference to the Ashram REE deposit PEA with the results disclosed as pretax. The presentation has been removed from the website.

In its corporate presentation, on its website, and in reporting the resource estimate and results of the revised PEA for the Ashram REE deposit completed by SGS Geostat, Canada Inc. (effective date Jan. 7, 2015), the company included a statement that is contrary to the definition of a PEA under NI 43-101, "All material above 0.51 per cent TREO [total rare earth oxides] is considered to be economic." This is retracted because the base-case resource estimate used as input to the Ashram PEA has a cut-off grade of 1.25 per cent TREO and the part of these resources considered by the PEA have potential economic viability. In the current PEA, material below the 1.25-per-cent resource cut-off and excluded from the economic analysis cannot have "potential economic viability," so it is not "considered to be economic."

In company news releases dated May 29, June 16 and July 24, 2015, and in website disclosure, the company reported resource estimates for the Ashram REE deposit as "measured and indicated" combined, without also disclosing the individual quantities and grades for the measured and indicated classes. For clarity, the attached table provides a compliant statement of the Ashram resource estimate.

The Ashram REE deposit was the subject of an amended and restated PEA with an effective date of Jan. 7, 2015.

SGS Geostat used a total of 43 drill holes comprising 15,604 metres of NQ- and BTW-sized drill core to develop the mineral resource estimate, with an effective date of March 6, 2012. When using a cut-off grade of 1.25 per cent REO (rare earth oxides), which is the base case for the PEA for the Ashram REE deposit, resources are estimated as in the attached table.

Category                    Tonnage  Density  TREO (%)  LREO (%)  MREO (%)  HREO (%)
 
Measured                  1,590,000     3.07      1.77      1.60     0.089     0.085
Indicated                27,670,000     3.02      1.90      1.77     0.073     0.056
Measured and indicated   29,270,000     3.02      1.90      1.77     0.073     0.057
Inferred                219,800,000     3.00      1.88      1.77     0.068     0.045
 
Notes:
1. LREO (light rare earth oxides) is lanthanum oxide plus cerium oxide plus  
   praseodymium oxide plus neodymium oxide.
2. MREO (middle rare earth oxides) is samarium oxide plus europium oxide plus 
   gadolinium oxide.
3. HREO (heavy rare earth oxides) is terbium oxide plus dysprosium oxide plus 
   holmium oxide plus erbium oxide plus thulium oxide plus ytterbium oxide plus 
   lutetium oxide plus yttrium oxide.
4. Mineral resources that are not mineral reserves do not have demonstrated economic 
   viability.
 

A summary of the PEA follows with appropriate cautionary language.

This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized.

The Ashram deposit hosts a well-balanced rare earth distribution throughout, in addition to significant enrichment over all five of the rare earths considered to be "critical" (neodymium, europium, terbium, dysprosium and yttrium). Within the overall resource, there exists a zone of more intense middle and heavy rare earth oxide (MHREO) enrichment, termed the "MHREO zone." This type of MHREO enrichment is unique to Ashram, and extends from surface with significant tonnage and grade. Over all, the Ashram deposit has a pervasive enrichment in the MHREOs, with the MHREO zone itself an area of more intense enrichment occurring directly at surface that extends to depths in excess of 175 metres.

Key findings of the PEA include:

• A 4,000-tonne-per-day open-pit operation with a waste-to-ore strip ratio of 0.19:1 over a 25-year mine life;
• A pretax and prefinancing net present value of $2.32-billion at a 10-per-cent discount rate;
• A pretax internal rate of return of 44 per cent and a pretax payback period of 2.25 years from start of production;
• An estimated capital cost of $763-million (including 25-per-cent contingency);
• An estimated operating cost of $95.20 per tonne treated or approximately $7.91 per kilogram of rare earth oxide produced;
• Annual production averaging approximately 16,850 tonnes of rare earth oxide over the life of mine, including 2,870 tonnes Nd oxide, 96 tonnes Eu oxide, 26 tonnes Tb oxide, 106 tonnes Dy oxide and 440 tonnes Y oxide;
• The rare earth element host mineralogy (monazite, bastnaesite and xenotime) comprises phases amenable to recovery with processing using conventional and proven techniques.

On the "corporate" page of the company's website, a prominent link to a corporate presentation dated September, 2012, referenced a positive PEA for the Blue River property. The company filed subsequent technical reports for the Blue River property with effective dates of June 21, 2013, and March 18, 2015, the latter of which is current and does not support going-forward disclosure of a positive Blue River PEA result. This outdated presentation and other media referencing the Blue River PEA have been removed from the website.

NI 43-101 disclosure

Darren Smith, MSc, PGeol, a qualified person as defined by NI 43-101, has read and approved the disclosure of the technical information in this news release.