News Release -

Rare Earth Metals Corp (REM.V), To Reorganize Mineral Resource Interests; Create New Gold Company.

June 1, 2005

Rare Earth Metals Corp., (REM – TSX.V), June 1, 2005, (the “Company”) is proposing a plan of arrangement to reorganize the company’s mineral resource interests with a view to maximizing shareholder value. Specifically, the company plans to transfer its interests in its Gold and Gold-Silver properties to a new exploration company, to be named Harvest Gold Corporation (“Harvest Gold”), for shares that will be distributed to Rare Earth Metals Corp shareholders. The company’s Base and Specialty Metals properties will remain in Rare Earth Metals Corp.

It is estimated that a total of 10 million common shares will be issued to the Company in exchange for a property portfolio comprised of the Longstreet Mine, a Nevada Gold-Silver property; and the Assean Lake and Little Assean River, Manitoba Gold properties, such that shareholders of the Company will receive approximately one Harvest Gold share for every two shares of the Company held by them (based on the current issued shares of the Company). An application for Harvest Gold to trade on the TSX Venture Exchange will also form part of the reorganization. Shareholders will be asked to approve this plan of arrangement at the August 12, 2005 AGM.

With approval from the shareholders to form Harvest Gold at the AGM and to meet minimum listing requirements for the new public company, a concurrent financing of a minimum of $480,000 and a maximum of $650,000 will be completed to allow the company to advance the gold-silver and gold projects referenced above. There will be unallocated working capital to allow Harvest Gold to seek new gold opportunities for Rare Earth Metals’ shareholders.

John Roozendaal, CEO and director of Rare Earth Metals states: “There are distinct and sizable investor audiences for pure gold companies and also for base and specialty metal companies. We believe our present property package is substantial, but because it consists of properties in both categories, we are often asked, what is our focus? This plan of arrangement eliminates that confusion in the marketplace. We want to intensify our efforts on creating value on our existing properties and be in a position to aggressively seek more opportunities for our shareholders. We believe the bull gold market will continue and that gold investors understand and want their companies focused on gold exploration. We are also convinced this broader commodity cycle will be with us for years to come. It just makes sense to create a separate company to maximize existing and new gold opportunities that may arise, and still be able to hunt for copper, nickel, uranium or other commodities that we evaluate to be prospective and worth our financier’s and shareholder’s attention and support.” .

Management believes that the reorganization will enable a more accurate assessment of the value of the Company’s assets and will provide its shareholders with direct ownership in two well focused, mineral specific companies.

The properties to be placed in Harvest Gold are: 1) The Longstreet Mine Gold –Silver property in Nye County, Nevada, on which the company has an option to earn a 100% interest. This will be the property of merit for Harvest Gold. A NI43-101 report is being completed and a working budget of at least $200,000 will be applied to the Longsteet property; 2) The Assean Lake Gold property in Northern Manitoba, on which the company has now earned in for its 40%. After five years, more than $3,000,000 of exploration work has been completed with joint venture partner, Canadian Goldhunter (T-CGH). Nine zones of gold mineralization have been discovered on the property. The most significant is the Hunt Zone, which remains open beyond a strike of 700m and below a depth of 300m. This property is an asset the company can move forward on without pressure of further property payments. It covers a 20 km long portion of the Assean Lake Shear Zone, a major regional fault system that controls the emplacement of gold mineralization in the area; and 3) The Little Assean River Gold claims, on which the company has an option to earn a 100% interest. This property covers a 15km long portion of the Assean Lake Shear Zone, directly East of the Assean Lake claims and includes the historic “gold trench showings” from the 1930’s.

At the AGM, shareholders will be asked to approve two boards of Directors. Rare Earth Metals’ proposed board will include existing directors Evan Sleeman, John Roozendaal, Richard Mark, and Dr. George Gale. Standing for election will be Mr. Michael Hitch. Mr. Jay Butterworth will not seek reelection. The contemplated slate of Directors for Harvest Gold will be Mr. Butterworth, Mr. Roozendaal, Mr. Sleeman, Mr. Mark, Dr. Gale and Mr. Hitch

Rare Earth Metals proposes to complete the plan of arrangement and distribute the shares of Harvest Gold to its shareholders in conjunction with its August 12, 2005 AGM to be held in Vancouver, British Columbia, Canada.

Detailed information on the transaction will be contained in the information circular to be mailed to the company’s shareholders in advance of the AGM. The information circular will also be posted on the company’s website at the date of mailing. The reorganization remains subject to regulatory approval.

On behalf of the Board of Directors,

John Roozendaal B.Sc
President, CEO & Director
Rare Earth Metals Corp.
 

For more information about Rare Earth Metals Corp. please review the company’s website www.RareEarthMetals.net or speak with a Company representative toll free 866 816 0118 or by emailing info@rareearthmetals.net

 
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