Frontier Intends to Commence Rare Earth Production

Frontier Rare Earths Limited is pleased to provide an update on the National Instrument 43-101 compliant ("NI 43-101")  Preliminary Feasibility Study ("PFS") that is being carried out at its Zandkopsdrift rare earth element project in South Africa ("Zandkopsdrift").

Following completion of a Preliminary Economic Assessment ("PEA") on Zandkopsdrift in Q1 2012, Frontier commenced work in Q2 2012 on the wide range of studies necessary to complete the PFS on Zandkopsdrift.  These studies are being carried out principally by the same multidisciplinary team of specialist consultants that was used by Frontier for the PEA.

Good progress has been made on the PFS since the update issued by the Company in November 2012, with most of the studies required for the PFS now complete. A number of improvements to the flow sheet for the Zandkopsdrift rare earth Processing Plant ("ZPP") have been identified since November 2012. The flow sheet has been revised accordingly and a confirmatory pilot scale metallurgical test program covering all major process steps was successfully completed in Q1 2013, following which the ZPP flow sheet was 'frozen' for the purpose of the PFS. The most significant remaining work required for the PFS is the finalization of engineering design and capital and operating cost estimates for the ZPP, which is currently under way and is scheduled for completion in July 2013. Accordingly, the results of the PFS are expected to be available and announced in Q3 2013.

With preparation of the PFS now at a very advanced stage, planning has commenced for the Definitive Feasibility Study ("DFS") on Zandkopsdrift, which will start immediately after the PFS and is expected to take 9-12 months to complete. Frontier is fully funded to complete the PFS and DFS on Zandkopsdrift from its existing cash resources. Along with its strategic partner, Korea Resources Corporation, which holds a 10% interest in and a 10% off take of production from Zandkopsdrift, Frontier intends to commence rare earth production in 2016, with a target production capacity of 20,000 tonnes of separated rare earth oxides per annum. This would position Frontier as one of the first new major rare earths producers and one of the largest producers of separated rare earths outside China.


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