6 June 2022

Rainbow Rare Earths Limited

("Rainbow" or "the Company")

LSE: RBW

Rainbow Accesses Rare Earth Opportunity in South Africa to

Demonstrate Separation Technology Expertise

Rainbow Rare Earths Limited announces that it has entered into a Memorandum of Understanding ("MoU") with a diversified chemicals group based in South Africa (the "chemicals group") to investigate the opportunity of extracting rare earth elements from a nitro phosphate process stream at its phosphoric acid production plant near Johannesburg in South Africa.

Under the terms of the MoU, Rainbow will conduct a rare earths extraction pilot study with the chemicals group, which will involve initial grade test work on processing stream material. This will be followed by a technical programme to confirm a flowsheet using Rainbow's knowledge and intellectual property ("IP") gained from work carried out to date at the Company's Phalaborwa Rare Earths Project ("Phalaborwa") in South Africa, including the licenced K-Technologies, Inc. ("K-Tech") separation technology.

The feedstock for the phosphoric acid production plant originates from the same ore originally mined by Foskor that generated the two gypsum stacks at Phalaborwa. Rainbow has already completed preliminary sampling of the processing stream, with initial results indicating a Total Rare Earth Oxide grade of 0.81% total rare earths oxides ("TREO"), with a circa 27% weighting to high-value neodymium and praseodymium ("NdPr"), alongside economic levels of terbium and dysprosium, similar to Phalaborwa.

Direct costs associated with the pilot study conducted by Rainbow using its exclusive IP and technology will be financed by the chemicals group.  Subject to a successful outcome, the parties intend to negotiate terms for a potential joint venture agreement to extract value from the rare earths present in the phosphoric acid processing stream.

Rainbow Rare Earths CEO, George Bennett, commented: "This project allows us to partner with a global chemicals business and demonstrates the significance and broader application of our IP and technology at another project in South Africa. This is a very exciting opportunity for Rainbow to release additional value from a nitro phosphate processing stream by efficiently producing separated rare earths, which are currently untapped within the phosphoric acid production process.

As at our Phalaborwa Project, the rare earths in this stream are contained within an acid solution in a 'cracked form', which will allow us to apply the rare earths separation technology, thereby facilitating a simple process with significantly fewer extraction and separation steps than a traditional rare earth mining project.

Through our processing projects, which have fundamentally different risk profiles to traditional rare earth mining projects, we see enormous potential to facilitate near-term access to sources of critical permanent magnet rare earths, which are required to decarbonise energy systems in an environmentally responsible way."

**ENDS**

Market Abuse Regulation ("MAR") Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

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Notes to Editors:

Rainbow's strategy is to become a globally significant producer of rare earth metals. NdPr and Dy are vital components of the strongest permanent magnets used for the motors and turbines driving the green technology revolution. Analysts are predicting demand for magnet rare earth oxides will grow substantially over the coming years, driven by increasing adoption of green technology, pushing the overall market for NdPr and Dy into deficit.

The Phalaborwa Rare Earths Project, located in South Africa, comprises an Inferred Mineral Resource Estimate of 38.3Mt at 0.43% TREO contained within gypsum tailings stacked in unconsolidated stacks derived from historic phosphate hard rock mining. High value NdPr oxide represents 29.1% of the total contained rare earth oxides, with economic Dysprosium and Terbium oxide credits enhancing the overall value of the rare earth basket in the stacks.  The rare earths are contained in chemical form in the gypsum stacks, which is expected to allow high-value separated rare earth oxides to be produced with lower operating costs than a typical rare earth mineral project.

The Company's Gakara Project in Burundi has produced one of the highest-grade rare earth concentrates in the world (typically 54% TREO) through trial mining operations. The Gakara basket is weighted heavily towards NdPr, which account for approximately 19.5% of the contained TREO and 85% of the value of the concentrate. The Gakara project is currently on care and maintenance at the request of the Government of Burundi.