American Rare Earths: Drilling Commences at Halleck Creek Project after Exploration Target increases 328%

Highlights:

• New drill campaign commences to define significant JORC Resource
• 36 reverse circulation holes planned for total length of 5,400 meters
• Drill permits approved to enable an expanded program up to 55 holes
• Drilling expected to be completed by Mid-December 2022.

October 5, 2022 / JMN Wire / American Rare Earths Limited (ASX: ARR, OTCQB: ARRNF, FSE: 1BHA) (ARR or ‘the Company’) is pleased to announce that exploration drilling began on October 4, 2022 to drill 36 reverse circulation (R/C) holes to define a maiden JORC resource at the 100% owned Halleck Creek project. Each drill hole is planned for a depth of 150 meters, for a total length of 5,400 meters. An additional 19 holes have been permitted to enable the program to be further expanded.

The Company contracted with FTE Drilling USA Inc to perform the work and expects drilling to be completed by Mid-December 2022.

This new drill campaign closely follows the capital raise of A$14.0 million the Company performed in August, 2022 and the 328% increased exploration target announced in September 2022.

Managing Director and CEO Chris Gibbs commented:

“We’re very excited to commence this drilling program to advance the massive Halleck Creek Project.

“The success of the maiden drill campaign saw us announce on September 1, 2022, boosting of the exploration target by 328% to a globally significant 1.01-1.27 billion tonnes of rare earth mineralised rocks.

“After completing a $14 million placement, announced on 4 August 2022, we are well capitalised to unlock the project’s potential and drive it forward into 2023 and beyond.

“Further encouragement for the progress of Halleck Creek came from the test work results on ore from our large-scale La Paz project, announced last week. These are significant for both projects because of the similarities between the ore.

“We’ve also initiated metallurgy test work specifically for Halleck Creek ore and look forward to providing an update on this as soon as results are available”.

Developing a Maiden Resource Estimate

The Company plans on using the results of this exploration drilling to define a JORC Compliant Maiden Resource at Halleck Creek. Work on developing initial geological models and grade models will commence in Q4 2022. The Company hopes to present Maiden Resource estimates in Q1 2023, depending on time required for all assays be completed.

Development of a JORC Resource at Halleck Creek is the next step in development after the updated JORC compliant Exploration Target estimate released September 1, 2022, by the Company in August, 2022.  The updated exploration targets outline between 1.01 and 1.27 billion tonnes of rare earth mineralised rocks with TREO grades ranging between 2,245 ppm and 2,807 ppm (Figure 1 and Figure 2). Readers are advised that the potential quantity and grade of the Halleck Creek resource are conceptual in nature, and there has been insufficient exploration to estimate a Mineral Resource and that it is uncertain if further exploration will result in the estimation of a Mineral Resource.  The Exploration Target has been prepared and reported in accordance with the 2012 edition of the JORC code.

Table 1 – Halleck Creek Exploration Target Estimates

TREO Range	Area	In-Place Tonnage			Average TREO Grade			Average MREO* Grade			Average Nd2O3 Grade			Average Pr6O11 Grade
(ppm)	(ha)	(millions)			(ppm)			(ppm)			(ppm)			(ppm)
1,500 – 2,000	90	168	–	210	1,398	–	1,748	461	–	576	336	–	420	89	–	111
2,000 – 2,500	82	183	–	229	1,807	–	2,259	470	–	588	340	–	425	91	–	114
2,500 – 3,000	103	254	–	318	2,213	–	2,766	524	–	655	379	–	473	103	–	129
3,000 – 3,500	133	220	–	275	2,597	–	3,246	593	–	742	433	–	542	119	–	149
3,500 – 4,000	111	149	–	186	2,964	–	3,705	647	–	808	474	–	593	131	–	163
>4,000	42	40	–	50	3,409	–	4,262	740	–	925	547	–	683	149	–	187
Grand Total	561	1,015	–	1,269	2,245	–	2,807	545	–	682	397	–	496	108	–	135

CQM Outcrop at Halleck Creek Rare Earths Project, Wyoming USA

Figure 1: Overton Mountain Proposed Drill Hole Locations

Figure 2: Red Mountain Proposed Drill Hole Locations

Next Steps

Completing the drilling campaign at Halleck Creek will be the focus of the Company’s operational personnel in the near term. The data collected from this drilling will be used to prepare our first detailed geological models of the area and then define the maiden JORC resource in Q1 2023.

We have initiated metallurgy test work for Halleck Creek ore with Wood Australia and Nagrom Laboratories in Western Australia. We look forward to updating the market as these results come to hand.

This market announcement has been authorised for release to the market by the Board of American Rare Earths Limited.

Mr Chris Gibbs

CEO & Managing Director

Competent Persons Statement:

The information in this document is based on a company memorandum entitled “2022 Exploration Target Summary of the Halleck Creek Project Area”, August 2022, compiled by Mr Dwight Kinnes employed by American Rare Earths, respectively. This memorandum has been reviewed and approved for release by Mr Dwight Kinnes (Society of Mining Engineers #4063295RM) is employed by American Rare Earths and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 JORC Code. Mr Kinnes consents to the inclusion in the report of the matters based upon the information in the form and context in which it appears.

About American Rare Earths:

American Rare Earths Limited (ASX: ARR, OTCQB: ARRNF, FSE: 1BHA) is an Australian company listed on the ASX with assets in the growing rare earth metals sector of the United States of America, emerging as an alternative international supply chain to China’s market dominance of a global rare earth market expected to expand to US$20 billion by the mid-2020s. The Company’s mission is to supply Critical Materials for Renewable Energy, Green Tech, Electric Vehicles, National Security, and a Carbon-Reduced Future.

Western Rare Earths (WRE) is the wholly owned US subsidiary of the Company. The Company owns 100% of the world-class La Paz Rare Earth Project, located 170km northwest of Phoenix, Arizona. As a large tonnage, bulk deposit, La Paz is potentially the largest, rare-earth deposit in the USA and benefits from containing exceptionally low penalty elements such as radioactive thorium and uranium. Approximately 742 – 928 million tonnes of Rare Earths mineralised rocks are identified as an exploration target in the La Paz Rare Earths Project’s Southwest area with an average TREO Grade of 350 – 400ppm and Scandium Oxide grade of 20 – 24.5ppm. The new exploration Target is additive to the La Paz Rare Earth project recently upgraded 170MT Resource. (ASX Announcement, 29 September 2021). During the period from February to April 2022 the Company drilled nine holes for 821 metres and collected 677 samples in the La Paz southwest area. The assay results from the first 332 samples demonstrate rock type associated with higher rare earth grades. The enhanced grades and thickness of the mineralised zone have accelerated exploration planning. Preliminary metallurgical test work demonstrates that La Paz ore can be effectively concentrated using conventional magnetic separation, selective grinding and direct flotation. Under the guidance of Wood Australia, advanced metallurgy and mineral processing test work is near completion with Nagrom Laboratories in Perth Western Australia (ASX Announcement, 7 April 2022).

In the first half of 2021, The Company acquired the USA REE asset, the Halleck Creek Project in Wyoming. Since acquiring the asset, the Company has increased the land holding to over 6,000+ acres. Approximately 1,015 to 1,268 million tonnes of rare earths mineralised rocks were identified as an exploration target for the Halleck Creek project area with an average Total Rare Earth Oxide (TREO) grade of 2,245 – 2,807 ppm. The Exploration Target estimate includes between 2.8 and 3.56 million In-Place tonnes of TREO at Halleck Creek.  The maiden exploration drilling program was completed in April 2022. The Company is executing a drilling program with the objective of defining a high tonnage maiden JORC resource.

La Paz and Halleck Creek’s mineral profiles are incorporated into emerging US advanced rare earth processing technologies in collaboration with US national laboratories, major universities and the US DOE innovation hub, the Critical Materials Institute.

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