Why is Namibia Rare Earths Unique?

What Makes Lofdal Unique

The Lofdal Rare Earth Project has two distinct characteristics that set it apart from all other rare
earth projects under development today. First of all, it is a new district scale discovery and
secondly, exceptional levels of heavy rare earth enrichment have been discovered.

District Scale Opportunity

Most rare earth projects have been known for many years and often for decades. They have
either been "dusted off the shelf” or they may have been evaluated for other commodities in the
past (i.e. uranium) and have been "re-branded” as rare earth projects.

The extent of rare earth mineralization at Lofdal was not recognized until Namibia Rare Earths
carried out its regional prospecting programs from 2008-2010. Namibia Rare Earths is the first
company to systematically explore the entire complex and the Company has 100% control of the
entire district.

Exploration is focused on discrete kilometer-scale structures with 50-90% HREE-enrichment.

The most advanced target is in Area 4 where drilling has delineated a National Instrument 43-
101 resource with exceptional HREE-enrichment to a vertical depth of approximately 150 meters.
Ongoing exploration drilling has intersected the deposit to 200 meters further down-dip of the
initial 43-101 resource.

Exceptional Heavy Rare Earth Enrichment

Namibia Rare Earths has demonstrated that the degree of heavy rare earth enrichment in certain
zones at Lofdal is the highest in the world. The unique opportunity at Lofdal is therefore to
discover not just new deposits, but to discover an economic deposit that would be the most
highly enriched heavy rare earth deposit in the world.

At Lofdal, exploration results from surface sampling and from drilling have encountered heavy
rare earth enrichment in excess of 90% with total grades of 0.5 to >1% TREO. Individual
samples have exceeded 98% heavy rare earth enrichment. This exceptional degree of
enrichment is what makes Lofdal unique.

Why are Heavy Rare Earths Important?

There are several fundamental reasons why higher concentrations of heavy rare earths are
important:

 Heavy rare earths are in fact rarer than their light rare earth counterparts. That results in
significantly higher prices for most heavies as compared to lights.
 
  There is growing demand for heavies in several high technology applications particularly
in the making of high powered magnets for use in mobile phones, hybrid automobiles and
renewable energy windmills.
 
 China has significantly decreased its exports of heavies and is indicating its reserves are
finite, further increasing global demand.

What is Heavy Rare Earth Enrichment?

Rare earths are generally grouped into two divisions: light rare earth elements ("lights”) and
heavy rare earth elements ("heavies"). There are five lights - lanthanum, cerium, praseodymium,
samarium and neodymium and ten heavies - europium, gadolinium, terbium, dysprosium,
holmium, erbium, thulium, lutetium, ytterbium and yttrium. While yttrium is not chemically a "rare
earth” it is typically grouped with the heavies as it shares similar characteristics to those
elements.

The total grade of a rare earth deposit is expressed as total rare earth oxide percentage
(%TREO). This can be subdivided into light rare earth grade (%LREO) and heavy rare earth
grade (%HREO). The ratio of HREO to TREO expressed as a percentage is the "heavy rare
earth enrichment”.

For example if TREO = 2% and HREO = 0.2% then the degree of heavy rare earth enrichment is
10%.

When this percentage is greater than 10% the deposit is considered to be "enriched in heavies".

It must be emphasized that the degree of heavy rare earth enrichment on its own cannot be used
to evaluate the significance of a deposit. You must know the total grade and the actual
concentrations of every element. What can be noted is that the range in total grades and degrees
of heavy rare earth enrichment in the more advanced rare earth projects being considered for
development today are from 0.2 - 12% TREO with heavy rare earth enrichments from 0.6 - 55%.
Value can be added to a lower grade deposit with increasing degrees of heavy rare earth
enrichment.

Degree of Heavy Rare Earth Enrichment from Selected Advanced

Rare Earth Projects