Canada Rare Earth Corporation

East Energy Corp. has received assay results from a sampling program carried out by Rare Earth Metals Inc. (REM) on its properties in the Red Wine alkaline complex in the Letitia Lake area of Labrador. These results include values up to 4.99 per cent total rare earth oxides (TREO), 0.97 per cent beryllium (BeO) and 2.35 per cent niobium (Nb2O5) from the Mann No. 1 zone and 3.24 per cent TREO, 0.93 per cent Be and 4.19 per cent N2O5 from the Two Tom Lake showing. The Red Wine properties are located 120 kilometres northeast of Churchill Falls, Labrador, and are within 40 to 60 kilometres of an existing resource road originating at Churchill Falls.

REM has acquired by option agreement and staking three properties — Mann No. 1 (37 claim units), Two Tom Lake (34 claim units) and Red Wine No. 2 (167 claim units). The properties are located in three separate claim groups located over a 30-kilometre length of the Red Wine complex. REM recently optioned the Mann No. 1 and Two Tom Lake properties and can earn a 100-per-cent interest on signing payment of $25,000 and 60,000 shares and total payments of $175,000 and the issuance of 500,000 shares over three years. Once vested the vendors will be entitled to a 2-per-cent net smelter return and starting on the fifth anniversary, advanced royalties of 20,000 shares per year. Half the NSR (1 per cent) can be purchased by REM for $1-million. The third property, Red Wine No. 2, was staked by REM in August, 2009.

The sampling was carried out by REM personnel in September, 2009, and all samples were delivered to a sample preparation facility in Newfoundland. The samples were analyzed at Activation Laboratories using inductively coupled plasma mass spectrometer. The digestion technique was total digestion that employs a lithium metaborate/tetraborate fusion. Approximately 15 per cent of the samples have been sent to a separate accredited lab for duplicate check analysis. TREO represents the total rare earth oxides and includes Y2O3.

A follow-up program of airborne geophysics, detailed sampling and grid work is planned on the three properties and should commence in late spring 2010. Pending results of these surveys drilling will be planned for the Mann No. 1 after completion of the ground surveys.

East Energy is completing the acquisition of REM under the terms of a business combination and amalgamation agreement dated Oct. 26, 2009. Details of the REM acquisition can be found in the company’s news in Stockwatch dated Sept. 15, 2009, and Nov. 5, 2009. Completion of the REM acquisition remains subject to acceptance by the TSX Venture Exchange. There can be no assurance that the REM acquisition will be completed as proposed or at all.

Wayne Reid, PGeo, is a qualified person as defined in National Instrument 43-101, and has reviewed and approved the technical information forming the basis for release.