Avalon Rare Metals and the Northwest Territory Metis Nation Enter into Participation Agreement

Toronto, Canada (ABN Newswire) - Avalon Rare Metals Inc. (TSE:AVL) (NYSE MKTS:AVL) ("Avalon" or the "Company") and the Northwest Territory Metis Nation ("NWTMN") are pleased to announce that they have entered into a participation agreement (the "Participation Agreement") for the Nechalacho Rare Earth Elements Project, Thor Lake, NWT, Canada (the "Project").

The Participation Agreement provides for training, employment, and business opportunities for the NWTMN related to the Project and associated facilities in the Northwest Territories. The Participation Agreement also contains measures to mitigate environmental and cultural impacts that may result from the project development.

Other aspects of the Participation Agreement include establishment of an implementation committee to continue interactions between Avalon and NWTMN, undertakings by Avalon regarding job training and scholarship participation for NWTMN members, co-ordination between Avalon and NWTMN on employment opportunities for NWTMN members, NWTMN participation in the environmental monitoring for the Project, protection of NWTMN traditional knowledge and culture, annual implementation capacity payments which commence when construction is commenced, and NWTMN undertakings regarding activities in support of the Project.

Gary Bailey, President of the NWTMN stated, "For the Northwest Territory Metis Nation the twentieth century was marred by the merciless exploitation of resources from our territory with no consultation with us, resulting in no benefit to our people. It's an amazing feeling and a wonderful pleasure to be in business with a far sighted, twenty-first century company like Avalon who recognizes our government, our people as a Nation, our friendship as valuable and our partnership as essential."

Don Bubar, Avalon's President and CEO commented, "Entering into the Participation Agreement with the NWTMN is another important step forward for the Nechalacho Project, following the Ministerial approval of the Project's Report of Environmental Assessment. We are committed to sharing the benefits of development with our aboriginal partners and we welcome the participation of the NWTMN in the Project."

In conjunction with the Participation Agreement, subject to regulatory approval, the Company has agreed to issue to the NWTMN 10,000 common shares of the Company, and to grant an aggregate of 20,000 non-transferable common share purchase warrants of the Company. The common shares are to be issued on the effective date of the Participation Agreement and will be subject to certain statutory restrictions on resale, as well as contractual restrictions on transfer pending receipt of certain regulatory permits and approvals for the Project. The common share purchase warrants will be issued in two equal installments of 10,000 warrants upon the Project meeting certain milestones, will have a term of five years and will have an exercise price based on the then current market price of the Company's common shares at the date of issue of the warrants.


About the Northwest Territory Metis Nation

The Northwest Territory Metis Nation is a society formed by the Hay River Metis Government Council, the Fort Resolution Metis Council and the Fort Smith Metis Council to represent Indigenous Metis of the Northwest Territory Metis Nation (the "Indigenous Metis"). As a distinct Metis Nation within Canada, the Indigenous Metis represented by the NWTMN possess Aboriginal rights in the areas historically used by them and their way of life is closely associated with harvesting of wildlife, fish and migratory birds. For more information visit www.nwtmetisnation.ca.


About Avalon Rare Metals Inc.:

Avalon Rare Metals Inc. (TSE:AVL) (NYSE-MKT:AVL) is a mineral development company focused on rare metal deposits in Canada. Its flagship project, the 100%-owned Nechalacho Deposit, Thor Lake, NWT is exceptional in its large size and enrichment in the scarce 'heavy' rare earth elements, key to enabling advances in clean technology and other growing high-tech applications. With a positive feasibility study and environmental assessment completed, Nechalacho remains the most advanced potential large new source of heavy rare earths in the world outside of China, currently the source of over 95% of the world supply. Avalon is well funded, has no debt and its work programs are progressing steadily. Social responsibility and environmental stewardship are corporate cornerstones.



Contact:

Avalon Rare Metals Inc.
Communications and Investor Relations
T: +1-416-364-4938
F: +1-416-364-5162
WWW: www.avalonraremetals.com