Rare Element increases financing to $1,500,000, files Tier One application

    TSX-V: RES

    VANCOUVER, May 22 /CNW/ - Rare Element Resources Ltd. (TSX-V: RES) ("Rare
Element" or the "Company") announces that the Company has agreed to increase
the financing announced on May 19, 2009, by $750,000 to $1,500,000 or 2
million Units due to strong demand and is fully subscribed. Each Unit consists
of one common share and one half of one common share purchase warrant. Each
whole warrant allows the holder to purchase one additional common share for a
period of 18 months from the closing date for additional consideration of

    Tier One application

    Rare Element has filed an application with the TSX Venture Exchange to
become a Tier One listed issuer. The TSX Venture Exchange has issued comments
on the application and the recently filed NI 43-101 compliant geological
resource report which the Company is in the process of responding to.
    Donald E. Ranta, President & CEO, commented that: "We were pleasantly
surprised by the demand for our financing and are now well positioned to
follow up on the recommendations in the Company's recent Technical Report
which provides an estimate of the current resource at Bear Lodge-9.8
Million-Ton Inferred Mineral Resource Averaging 4.07% Rare-Earth Oxides(*). (As
announced on March 23, 2009). Several people have asked about the economics of
the project and some information is provided in the NI 43-101 compliant
geological resource report filed on www.sedar.com beginning on Page 107. We
will be making some format edits to the NI 43-101 compliant report as
requested by the TSX Venture Exchange to complete the Tier One application. We
are currently planning for additional metallurgical test work and a summer
drill program as recommended in the report."
    (*) The mineral resource estimate was completed by Mr. Alan C. Noble, P.E.,
principal engineer of Ore Reserves Engineering, and is based on geological
interpretations supplied by the Company to ORE and subsequently modified by
ORE. Mr. Noble is an independent qualified person for the purposes of National
Instrument 43-101 standards of disclosure for mineral projects of the Canadian
Securities Administrators and has verified the data disclosed in this release.

    Rare Element Resources Ltd (TSX-V:RES) is a publicly traded mineral
resource company focused on gold and strategic metals such as the rare-earth
elements. Rare Element and Newmont have entered into the Sundance gold
exploration joint venture on the Company's Wyoming property. Newmont has the
right to earn a 65% working interest in Rare Element's property, excluding any
rights to the rare-earth elements and uranium but including rights to gold and
other metals, by performing US$5 million in property work expenditures over a
five-year period. Newmont also has the right to earn an additional 15% working
interest by completing a positive project feasibility study.
    Rare Element's Bear Lodge property, Wyoming, also encompasses one of the
largest disseminated rare-earth occurrences in North America (M H Staatz,
1983, US Geological Survey Professional Paper 1049D). In parallel with the
Sundance gold-focused exploration project, Rare Element has completed a NI
43-101 compliant resource estimate and a Technical Report on the Bear Lodge
Rare-Earth Mineralization. The Company is also continuing with a metallurgical
testing program of the drill-hole samples collected during 2008 and planning a
2009 drilling program to increase the resources.

    Donald E Ranta, PhD, PGeo,
    President & CEO

    Donald E. Ranta, PhD, PGeo, serves the Board of Directors of the Company
as an internal, technically Qualified Person. Technical information in this
news release has been reviewed by Dr. Ranta and has been prepared in
accordance with Canadian regulatory requirements that are set out in National
Instrument 43-101. This news release was prepared by Company management, which
takes full responsibility for content. Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of
this release.

For further information:

For further information: refer to the Company's website at
www.rareelementresources.com or contact: Donald E Ranta, President & CEO,
(604) 687-3520, don@rareelementresources.com; Mark T. Brown, CFO, (604)
687-3520 ext. 242, mtbrown@pacificopportunity.com

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