TMX group

TSX-V: RES

VANCOUVER, Oct. 12 /CNW/ - Rare Element Resources Ltd (TSX-V: RES)
announces that trenching and drilling are underway at the Newmont - Rare
Element Resources venture, which is exploring for gold on the Company's Bear
Lodge property in northeast Wyoming.
Seven reverse-circulation drill holes have been completed for a total
1350 metres of drilling. One reverse-circulation hole remains to be drilled.
The first core hole has reached a depth of 200 metres, with approximately 625
metres remaining to be drilled. Two additional core holes will be drilled. Six
trenches have been constructed for a total length of approximately 1000 metres
of trenching. The trenches were mapped, sampled and geophysically surveyed for
radiometric and magnetic susceptibility. Assay turnaround has been very slow,
with the majority of trench sample results and all soil and drill sample
results still outstanding.
Initial mapping, geophysical surveys and soil and rock sampling
concentrate on the Taylor Ridge, Carbon Hill and the East and West Breccia
prospects, where historical work has identified gold mineralization. While
most of the assay results remain outstanding, Newmont's work confirms areas of
anomalous gold, arsenic, antimony and tellurium on Carbon Hill and Taylor
Ridge, which are coincident with potassic alteration in the rocks of the
alkalic intrusive complex. Rock samples from Taylor Ridge, where visible gold
has been identified in outcrop, consistently returned the highest gold values,
which grade up to ten grams of gold per tonne.

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 (REE's). Previous gold exploration on the Company's Bear
Lodge, Wyoming property has identified gold occurrences in intrusive breccia
bodies and numerous gold geochemical anomalies. The surface geology exposes
the upper levels of a mineralized alkaline-igneous intrusive complex, which is
geologically similar to the intrusive complex that hosts the Cripple Creek,
Colorado, gold deposits.

Paso Rico (USA) Inc, a wholly owned subsidiary of Rare Element Resources,
and Newmont North America Exploration Limited, a subsidiary of Newmont Mining
Corporation (Newmont), have entered into a gold-exploration venture on the
Company's Bear Lodge property. Newmont is the manager of the gold-exploration
program. Newmont has the right to earn a 65% working interest in Rare Element
Resources' Bear Lodge 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.
The Bear Lodge property also has rare-earth-element (REE) exploration
potential. The author of US Geological Survey Professional Paper 1049D stated
that, what is now Rare Element Resources' Bear Lodge REE property is the
largest disseminated REE occurrence in North America. REE's, which have been
called "catalysts for high-tech living," are required for many new
technologies, including nickel-metal-hydride batteries and the motors,
generators and batteries used in hybrid cars. The US market for REE's exceeds
US$1 billion, with most supplied by China.

ON BEHALF OF THE BOARD

William H Bird, PhD,

President & CEO

William H. Bird, PhD, PGeo, serves the Board of Directors of the Company
as an internal, technically Qualified Person. Technical information in this
news release has been prepared in accordance with Canadian regulatory
requirements set out in National Instrument 43-101 and reviewed by Dr Bird.
This news release was prepared by Company management, who take full
responsibility for content. The TSX Venture Exchange has not reviewed and does
not accept responsibility for the adequacy or accuracy of this release.