CRITICAL RARE EARTH REFINING AND PROCESSING

CORPORATE OVERVIEW

December 2013

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CONTENTS OVERVIEW

• Overview of Rare Earths and the market• Introduction to CEC Rare Earth Corp• The building of Rare Earth Refineries• Supply of Rare Earth Products

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KEY MESSAGES• A significant gap exists for supply of Critical Rare Earth products and there is a race to

fill it – CEC Rare Earth has proven capabilities to build refineries for these products• The supply of these critical resources within the Western hemisphere will be highly

valued for re-establishing supply chains and industrial bases outside of China• A secure source of these strategic resources enables regional investment in related

industries and businesses• Rare earths contribute more to global climate change than any other factor – by

enabling clean technologies such as hybrid cars, alternative energies and cleaner gasoline and diesel.

• Contrary to typical commodities and metals (Gold, Silver, Copper) the largest value add activities in Rare Earth products is the refinery:

– Ore – $1– Concentrate - $5– Refined Rare Earth Products - $20 -$100

• A major Rare Earth facility for Critical Rare Earth products established within 3 years can be competitive with the largest RE companies globally in revenues & profits.

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RARE EARTHS AND THE MARKETSources, applications, uses, demand and supply

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WHAT ARE RARE EARTH ELEMENTS?

• 17 elements used for improved performance and quality• Found combined together in mineral deposits• Rare Earths are of little industrial value unless separated

Light Rare Earth Elements (LREE) Heavy Rare Earth Elements (HREE)

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RARE EARTHS BACKGROUND

• Rare Earth mineral deposits are not rare

• Commercially viable Rare Earth mineral deposits are rare

• Rare Earths separation capability is extremely rare outside of China

• CEC Rare Earth delivers proven Critical Rare Earth separation capability outside China

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Neodymium Praseodymium Dysprosium Terbium

Yttrium Europium Terbium

Neodymium Praseodymium Dysprosium Terbium

Neodymium Praseodymium Dysprosium Terbium

GREEN TECH APPLICATIONS

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FOCUS ON THE CRITICAL REES

Heavies (HREEs)Dysprosium (Dy)Terbium (Tb)Europium (Eu)Yttrium (Y)

Lutetium (Lu)Gadolinium (Gd)Holmium (Ho)Erbium (Er)Thulium (Tm)Ytterbium (Yb)

Lights (LREEs)Neodymium (Nd)

Praseodymium (Pr) Cerium (Ce)Lanthanum (La)Samarium (Sm)

CEC Rare Earth plants and our partners will produce all of the Critical Rare Earth products.

GLOBAL SUPPLY SITUATION

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Source: IMCOA

Surplus or Deficit of major Rare Earths

2010

2015

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CEC RARE EARTH CORPAn introduction and overview

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WHO IS CEC RARE EARTH CORPORATION?• CEC Rare Earth Corporation is based in Vancouver, Canada with a

strong management team and key advisors from China’s Rare Earth industry

• CEC Rare Earth team has significant experience in processing and supplying Rare Earths– Team members has many years of collective experience and have design

and built over 10 refineries inside and outside China

• CEC Rare Earth has two complementary business areas:1. Designing, Building and operating of Rare Earth Refineries outside of

China

2. Supply of Rare Earth Products to top level industries outside of China

CEC RARE EARTH’S KEY PEOPLE

Rojer Li (Managing Director)– 10 years experience in RE industry, extensive contacts in refining and international trading.– Li family business owns and operates the premier rare earth engineering and design company in China as well they

own, in whole or in part, four rare earth refineries inside and outside of China.

Bill Purcell (CEO)– Extensive experience in the downstream oil industry.– Strong background in environmental management

Peter Shearing (SR VP – Sales & Business Development)– Broad international experience in the electronics and high-tech manufacturing industries. – 25+ years of materials, electrical, and process engineering background

Apolo Ohno (Director)Wide ranging international business experience with Fortune 500 companies; the most decorated US

Winter Olympian

Rod Jao (Director)

Global venture capital experience with a variety of industries including technology, manufacturing and telecommunications.

Tracy A Moore (Advisor)

Extensive corporate finance experience in 20 countries, and CEO of REC’s strategic partner, Canada Rare Earth, a public Canadian rare earth exploration company.

REC Confidential 12

Feb 2013

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CHALLENGES & OPPORTUNITY

Global Rare Earth Supply and Demand Situation• Global industry depends on China’s refineries (>90%) for Rare Earth products

• Demand for Rare Earth materials in new clean technologies and advanced applications is growing and exceeding global output

• Prices reflect this supply gap and the lack of Western rare earth refining capability

• Non-China based companies demand new sources of Rare Earth supply outside of China to support their business and products

• Establishment of Rare Earth refineries requires very specialized and hard to obtain expertise and experience

The CEC Rare Earth Opportunity• Unique team with technical expertise in the design, build and operation of Rare Earth

separation plants

– experience not available from other engineering companies

• CEC Rare Earth’s advantage provides supply for its customers through highly valued off take agreements to deliver significant revenues and profits

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BUILDING RARE EARTH REFINERIESCEC Rare Earth Corp unique capabilities and the advantages

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“Finding rare earths are only a small part of the process of turning the ore into usable materials” Dr. Steven Leeb

“Mining is the easy bit: Separating rare earth elements is where the complexity comes in” Kidela Capital presentation

“Mining is — believe it or not — the absolute easiest thing we do. Once we pull it out of the ground, that’s when things get complicated,” Mark Smith, MolyCorp past CEO

CEC RARE EARTH ADVANTAGE

Turn Key Refinery Projects– Proven expertise, experience and IP in design, construction and

operations

– Lower project risks of design flaws, construction cost overruns, operating problems and delays getting to market.

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VERTICAL INTEGRATION• Buyers’ Rare Earth needs are matched to mine deposit• Ingredients for a Joint Venture – mine, refiner, buyer• Attractive to investors: pre-sold high value output, efficient

refinery

Buyers

Refinery

Mine

Concentrate

Separated oxides & metals

• Specific element and quality specs• Need secure, reliable supply• Want reasonable, predictable prices

• Efficient design:• Reliable supply of consistent raw materials• Known and pre-sold end product specs

• Extends the value chain beyond concentrate

VALUE COMPARISONCEC Rare Earth

Turn-key Separation Plant• Fixed Price contract delivers a complete and

operating separation plant • Guaranteed startup success based on numerous

refinery startups• Proven ability to separate all Critical Rare Earth

Elements, production of specialty products, • Integrated process design and build team of

Rare Earth refinery experts • Operations training and support

Advantages with Turn-key• Fixed Cost• Proven ability to deliver quality

Rare Earth products• On time completion

Typical Engineering Project

• Estimated costs only for individual elements (design, build, operate etc.), based on little to no experience in REO separation

• Little if any experience in the startup and optimization of a REO separation plant

• Individual process design, build, startup, and operation teams with varying levels of RE knowledge and experience

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Engineering Project Risks• Late startup • Quality issues• Budget overruns

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SUPPLY OF RARE EARTH PRODUCTSCEC Rare Earth Corp Supply Chain

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CEC RARE EARTH’S CHINA EXPORT SOURCES

• CEC Rare Earth has 4 primary sources within China all who have been inspected and approved for the environmental requirements

• Access to all RE oxides, metals, and specialty compounds for domestic China requirements or exportation

• More than 2000 MT committed to CEC Rare Earth for export to its customers

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PARTNER REFINERY

Mechanically complete & in final

permit approval process

• 2015 production start

• SE Asia: outside of China

• 3,000 MT Critical Rare Earth Products

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LONGER TERM SUPPLY

CEC Rare Earth is securing future supply from new projects;• Currently in planning, design and permit stage for a full spectrum Rare Earth plant

in SE Asia

• Additional projects agreement for a 2nd SE Asia refinery; combined output exceeds 5000 MT

• Strategic alliance with Canada Rare Earth for two more major proposed refineries.

• Expect to build a total of 5 refineries with total capacity exceeding 15,000 MT

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EXECUTIVE SUMMARY• CEC Rare Earth Corporation’s business:

– Building Turn-key Rare Earth refineries

– Supply of all Rare Earth products

• Over 5000 MT of Rare Earth supply available for top tier customers including supply from non-China based refineries

• CEC Rare Earth has the proven capability for processing Critical Rare Earth products outside of China

• CEC Rare Earth is building a full spectrum Rare Earth refinery outside China and an opportunity to participate currently exists

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THANK YOU