“Some of the REE applications are viewed as more important than others and some are at greater risk than others, namely the Heavy Rare Earth Elements (HREEs), as substitutes are unavailable or not as effective.”

The CRS report (http://www.fas.org/sgp/crs/natsec/R41347.pdf), entitled, ???Rare Earth Elements: The Global Supply Chain,??? is submitted to identify the seriousness of the potential rare earths supply crisis and states (in part): ???The concentration of production of rare earth elements (REE???s) outside the United States raises the important issue of supply vulnerability. REE???s are used for new energy technologies and national security applications.???

The CRS report stated (on page 7 of the report) that: ???U.S. Rare Earths, Inc. (another U.S. based company), in the pre-feasibility stage of mine development, has long-term potential because of its large deposits in Idaho, Colorado, and Montana.???

U.S. Rare Earths, Inc.???s Chief Executive Officer, Edward Cowle, said, ???While the newly released congressional report highlights the critical need to secure reliable rare earth materials from U.S. sources, it also is encouraging that the report suggests that the executive branch may take steps to ensure that the cost of U.S. operations are competitive with other regions of the world. This would complement U.S. Rare Earths, Inc.???s efforts to commercialize the company???s reserves and fulfill our goal to become a domestic supplier of both light and heavy rare earth materials for U.S. military and industry. The company is currently evaluating various financial opportunities that are being presented to U.S. Rare Earths, Inc. due to the unprecedented positive developments that are occurring in the capital markets for rare earth exploration companies.???

On the subject of resource competitiveness, CRS noted the role of government policy: ???There may be public policies enacted or executive branch measures taken to offset the U.S. disadvantage of its potentially higher cost operations. The current goal of U.S. mineral policy is to promote an adequate, stable, and reliable supply of materials for U.S. national security, economic well-being, and industrial production.???

Focus on Heavy Rare Earth Elements

The report took into account the relative differences in demand for specific Rare Earth Elements, concluding that ???Some of the REE applications are viewed as more important than others and some are at greater risk than others, namely the Heavy Rare Earth Elements (HREEs), as substitutes are unavailable or not as effective.

???The U.S. Federal Government and the private sector are beginning to address how to secure reliable rare earth materials (raw materials through metals and alloys) from China and non-Chinese sources in the short term, and how to rebuild the U.S. supply chain for the long term. The lighter elements such as lanthanum, cerium, praseodymium, and neodymium are more abundant and concentrated and usually make up about 80% - 99% of a rare earth deposit. The mid-atomic and heavy rare-earth elements - gadolinium through lutetium and yttrium - are scarcer but very 'desirable,' according to U.S. Geological Survey (USGS) commodity analysts.???

¹ http://www.loc.gov/crsinfo/whatscrs.html

Current U.S. Geological Survey (USGS) reports show that U.S. Rare Earths, Inc. owns the mineral rights to:

• One of the??major??deposits of rare earth elements (REE) in the United States.
• One of the few U.S. deposits that have significant heavy REE (???HREE???) concentrations.