Molycorp Secures Government Approval To Conduct Heavy Rare Earth Exploratory Drilling

Molycorp, Inc. (NYSE: MCP) today announced that it has been granted
authorization from the U.S. Bureau of Land Management to commence
exploratory drilling at an occurrence of heavy rare earths located near
its flagship rare earth manufacturing facility at Mountain Pass,
California.

'This is an important milestone in our heavy rare earth strategy, and we
expect to begin drilling immediately,? said Mark A. Smith, Molycorp's
President and Chief Executive Officer. 'We anticipate results from the
drilling program in the second quarter of 2012. I′d also like to
compliment the Bureau of Land Management and the U.S. Department of
Interior for their thorough and efficient review of our drilling Notice.'

Preliminary exploration at the site has shown rare earth mineralization
with an average ore grade of approximately four percent and a relatively
high percentage of heavy rare earths, such as terbium, dysprosium,
europium and samarium, as well as relatively high percentages of
yttrium, neodymium, and praseodymium.

About Molycorp, Inc.

With offices in the U.S., Europe, and Japan, Molycorp, Inc. is the only
U.S-based company that is fully integrated across the rare earth
mine-to-magnets supply chain. In addition to its current production of
REO at its flagship rare earth mine and processing facility at Mountain
Pass, California, the Company produces rare earth metals, rare earth
alloys (such as neodymium-iron-boron and samarium-cobalt alloys) and
rare metals such as niobium and tantalum. The rare earths and rare
metals Molycorp produces are critical inputs in existing and emerging
applications including: clean energy technologies, such as hybrid and
electric vehicles and wind power turbines; multiple high-tech uses,
including fiber optics, lasers and hard disk drives; numerous defense
applications, such as guidance and control systems and global
positioning systems; advanced water treatment technology for use in
industrial, military and outdoor recreation applications; and other
technologies. For more information please visit www.molycorp.com

Safe Harbor Statement Regarding Forward-Looking Statements

This release contains forward-looking statements that represent
Molycorp′s beliefs, projections, and predictions about future events or
future performance. Forward-looking statements can be identified by
terminology such as 'may,? 'will,? 'would,? 'could,? 'should,? 'expect,?
'intend,? 'plan,? 'anticipate,? 'believe,? 'estimate,? 'predict,?
'potential,? 'continue? or the negative of these terms or other similar
expressions or phrases. These forward-looking statements are necessarily
subjective and involve known and unknown risks, uncertainties and other
important factors that could cause Molycorp′s actual results,
performance or achievements or industry results to differ materially
from any future results, performance or achievement described in or
implied by such statements.

Factors that may cause actual results to differ materially from expected
results described in forward-looking statements include, but are not
limited to: Molycorp′s ability to secure additional capital to implement
its business plans; Molycorp′s ability to complete its initial
modernization and expansion efforts, including the accelerated start-up
of the Mountain Pass facility, which management refers to as Project
Phoenix Phase 1, and the second phase capacity expansion plan, which
management refer to as Project Phoenix Phase 2, and reach full planned
production rates for REOs and other planned downstream products; the
final costs of the Project Phoenix Phase 1, including with accelerated
start-up of the Mountain Pass facility, and Project Phoenix Phase 2,
which may differ from estimated costs; uncertainties associated with
Molycorp′s reserve estimates and non-reserve deposit information;
uncertainties regarding the results of exploratory drilling programs;
uncertainties regarding global supply and demand for rare earths
materials; Molycorp′s ability to successfully integrate recently
acquired businesses; completion of the formation of the proposed
sintered NdFeB rare earth magnet joint venture, which remains subject to
the satisfaction of customary closing conditions; the proposed sintered
NdFeB rare earth magnet joint venture′s ability to successfully
manufacture magnets within its expected timeframe; Molycorp′s ability to
maintain appropriate relations with unions and employees; Molycorp′s
ability to successfully implement its 'mine-to-magnets? strategy;
environmental laws, regulations and permits affecting Molycorp′s
business, directly and indirectly, including, among others, those
relating to mine reclamation and restoration, climate change, emissions
to the air and water and human exposure to hazardous substances used,
released or disposed of by Molycorp; and uncertainties associated with
unanticipated geological conditions related to mining.

For more information regarding these and other risks and uncertainties
that Molycorp may face, see the section entitled 'Risk Factors? of the
Company′s Annual Report on Form 10-K for the year ended December 31,
2010 and of the Company′s Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2011. Any forward-looking statement
contained in this press release or the Annual Report on Form 10-K or the
Quarterly Report on Form 10-Q reflects Molycorp′s current views with
respect to future events and is subject to these and other risks,
uncertainties and assumptions relating to Molycorp′s operations,
operating results, growth strategy and liquidity. You should not place
undue reliance on these forward-looking statements because such
statements speak only as to the date when made. Molycorp assumes no
obligation to publicly update or revise these forward-looking statements
for any reason, or to update the reasons actual results could differ
materially from those anticipated in these forward-looking statements,
even if new information becomes available in the future, except as
otherwise required by applicable law.

Molycorp, Inc.

Jim Sims, 303-843-8062

Vice President Corporate
Communications

Jim.Sims@Molycorp.com

or

Brian
Blackman, 303-843-8067

Senior Manager, Investor Relations

Brian.Blackman@Molycorp.com