AVL's Thor Lake

THOMAS RENAUD, Arrowhead Business and Investment Decisions (09/15/2009)
Avalon Rare Metals Incorporated is a Canadian junior mining company with five key projects in exploration and development of rare earth elements (REEs), rare metals and rare minerals. The company's portfolio is balanced overall with three secondary mining projects in base and precious metals. All owned assets are located in Canada.

Avalon has no assets in production as of 15th September 2009, but has three key assets out of five in exploration or development phases. The company's focus is on the high-potential Thor Lake REE asset in the Northwestern Territories.

The company's main target commodities have very interesting marketability data with foreseeable increases in demand and price effects with lagging growth in offer. This is especially the case of REEs.

With its focus on rare metals, a specific and rare subsector of mining, Arrowhead believes that Avalon's performance should be relatively decoupled from the performance of comparable enterprises or the usual key commodity indicators such as oil, gold and copper prices.

Given due diligence and valuation estimations based on intrinsic revenue capacity of existing assets, Arrowhead believes that Avalon's fair share value lies in the CAN$3.94 to CAN$13.04 bracket.

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