Mr. Alain Wilson reports

QUEST UPDATE ON PRIVATE PLACEMENT OF SPECIAL WARRANTS

The Toronto Stock Exchange has granted conditional approval for Quest Rare Minerals Ltd.'s previously announced best-efforts private placement of special warrants to accredited investors in Ontario, Alberta and British Columbia in a maximum amount of $8-million.

The private placement will consist of a maximum of 37.5 million Special Warrants at a price of $0.20 per Special Warrant, for maximum proceeds to Quest of $7.5 million. Secutor Capital Management Corporation, the lead agent for the private placement, will have an "agent's option", which may be exercised prior to closing, to sell up to an additional 2.5 million Special Warrants for additional proceeds of $500,000. If the agent's option is exercised in full, Quest will issue 40 million Special Warrants for gross proceeds of $8 million.

The net proceeds from the private placement will be used by Quest for its full-scale pilot plant project and process optimization (part of Quest's Strange Lake Project) and for working capital and general corporate purposes.

Each of the Special Warrants may be exchanged for no additional consideration for one Quest common share ("Share") and one Quest common share purchase warrant ("Warrant"). Each of the Warrants will entitle its holder to purchase one Share at a price of $0.275 for a period of three years from the closing date of the private placement.

Quest will file a prospectus in those provinces in which Special Warrants are sold in order to qualify for distribution the Shares and Warrants issuable upon the exchange of the Special Warrants. The Special Warrants will be deemed to be exercised without payment of additional consideration or further action on the third business day following the day upon which Quest obtains a receipt for the final prospectus. In the event that Quest does not obtain a receipt for the final prospectus from the applicable Canadian securities authorities within 30 days of the closing of the private placement, each Special Warrant will be exchanged, at no additional cost, for 1.25 Shares and 0.75 Warrants (instead of one Share and one Warrant). In that event, each Warrant will entitle its holder to purchase one Share at a price of $0.275 for a period of four years from the closing date of the private placement.

The closing of the private placement is expected to take place on or about February 17, 2017, subject to customary closing conditions and filing of standard documents with the Toronto Stock Exchange. Quest and Secutor Capital Management Corporation have agreed to waive the previously-announced minimum of 25 million Special Warrants ($5 million), such that there is no minimum amount for the private placement.

ABOUT QUEST

Quest is a Canadian-based company focused on becoming an integrated producer of rare earth metal oxides and a significant participant in the rare earth elements (REE) material supply chain. Quest's objective is the establishment of major hydrometallurgical and refining facilities in Becancour, Quebec, to separate and produce strategically critical rare earth metal oxides.

We seek Safe Harbor.