Dr. Donald Ranta reports

RARE ELEMENT FILES FINAL PROSPECTUS IN CANADA

Rare Element Resources Ltd. has obtained a receipt for its final short form prospectus filed with the securities regulatory authorities in each of the provinces of Canada, except Quebec, and has entered into an agency agreement with a syndicate of agents for its previously announced best efforts public offering of up to 5.56 million common shares of the company at an issue price of $9.00 per share. The offering will raise gross proceeds to the company of up to $50.04-million. The agents also have the option to purchase from the company up to 834,000 additional shares at the issue price exercisable for a period of 30 days from the closing date (as defined herein). The syndicate of agents was co-led by Byron Securities Limited and GMP Securities LP, and includes Jacob Securities Inc., Global Hunter Securities LLC (as a U.S. placement agent) and Salman Partners Inc.

Mark T. Brown, chief financial officer director, commented that "Rare Element has spent the past three weeks meeting with important investors in many locations. This is an important step in continuing the growth of the company and ensuring that shareholders are well informed about our plans to become a rare earth oxide producer. The agents have done an excellent job of introducing the company to new institutional investors, and we are very pleased with the positive response."

The net proceeds from the offering will be used to finance the work program at the company's Bear Lodge rare earths deposit in Wyoming, USA, including the completion of a prefeasibility study, pilot plant testing, drilling, metallurgical work, exploration programs and for general working capital purposes.

The company has agreed to pay to the agents a cash commission equal to 6 per cent of the total gross proceeds from the offering (including the overallotment option). As additional consideration for the services of the agents, the company shall also issue to the agents broker warrants entitling the agents to subscribe for that number of shares as is equal to 6 per cent of the total number of shares sold pursuant to the offering, including the overallotment option. Subject to regulatory approval, each broker warrant will be exercisable to acquire one share at a price equal to the issue price for a period of 24 months after the closing date.

The offering is expected to close on or about Dec. 22, 2010, subject to customary closing conditions. The company has received conditional approval to list the shares distributed under the offering on the TSX Venture Exchange and has applied to list the shares on the NYSE Amex.

During the review process, the company received comments from the British Columbia Securities Commission on various documents and has refiled its preliminary economic assessment, financial statements for the first quarter ended Sept. 30, 2010, and its management's discussion and analysis for the same period with minor corrections.

We seek Safe Harbor.