Molycorp Announces Start-Up of Heavy Rare Earth Concentrate Operations at Mountain Pass, Calif.

Molycorp, Inc. (NYSE:MCP) today announced the start-up of its new
Project Phoenix heavy rare earth concentrate facilities at Mountain
Pass, California, which will produce heavy rare earth concentrate from
freshly mined Mountain Pass ore that will then be processed into
high-purity, custom-engineered heavy rare earth products in Molycorp′s
globally integrated production facilities.

Molycorp also announced that its on-site Combined Heat and Power (CHP)
plant will begin feeding low-cost, high efficiency electrical power and
steam this week to its Mountain Pass facilities. Molycorp's CHP plant is
fueled by clean-burning natural gas fed to the facility by a recently
completed natural gas lateral supply line that connects the facility to
a nearby interstate natural gas pipeline operated by Kern River Gas
Transmission Company.

'We have launched operations of Project Phoenix′s heavy rare earth
concentrate facilities on schedule, our combined heat and power plant is
set to begin powering our new facilities this week, and we remain on
track to achieve full Phase 1 production rates at Mountain Pass in the
fourth quarter of this year,? said Mark A. Smith, Molycorp′s President
and Chief Executive Officer. 'The heavy rare earth concentrate we will
produce at Mountain Pass will support our production of a full range of
high-purity, custom-engineered materials from light, medium, and heavy
rare earths. Such vertical integration strongly positions Molycorp to
compete successfully across multiple markets.?

Molycorp's heavy rare earth concentrate contains dysprosium, terbium,
europium, and other elements that will be further processed by the
Company into rare earth oxides, metals, alloys, and magnetic materials
used in such technologies as hybrid electric vehicles, wind turbines,
high efficiency appliances and motors, consumer electronics, and many
other important applications.

Molycorp currently produces high-purity products from the following rare
earths: Cerium, Lanthanum, Praseodymium, Neodymium, Samarium, Europium,
Gadolinium, Terbium, Dysprosium, Holmium, Erbium, Lutetium, and
Ytterbium (with purity levels as high as 99.999% for some rare earth
products). It also produces high-purity products from the following rare
metals and transition metals: Gallium, Rhenium, Indium, Tantalum,
Niobium, Zirconium, and Yttrium (with purities as high as 99.999999% for
some of these products).

About Molycorp, Inc.

Molycorp is a leading rare earths and rare metals company, and combines
a world-class rare earth resource at Mountain Pass, California, with
advanced, high-purity rare earth and rare metal materials processing
capabilities. With 26 locations across 11 countries, Molycorp is
vertically integrated across the global rare earth mine-to-magnetics
supply chain. It produces rare earth magnetic materials as well as a
variety of high-purity, custom engineered products from 13 different
rare earths (lights and heavies) as well as five rare metals (gallium,
indium, rhenium, tantalum and niobium), and the transition metals
yttrium and zirconium. Through its Molycorp Magnequench subsidiary, the
Company is a leading global producer of neodymium-iron-boron (NdFeB)
magnet powders, used to manufacture bonded NdFeB permanent rare earth
magnets. Through its joint venture with Daido Steel and Mitsubishi
Corporation, Molycorp expects to begin manufacturing next-generation,
sintered NdFeB permanent rare earth magnets in early 2013. The rare
earths and rare metals materials that Molycorp produces are critical
inputs in wide variety of existing and emerging applications, including
the following: advanced transportation technologies, such as hybrid
electric, plug-in hybrid electric, and all-electric vehicles; clean
energy technologies, such as solar and wind power systems; energy
efficiency technologies, such as high efficiency motors and appliances,
compact fluorescent lights, and color displays; computing and
communications applications, including fiber optics, lasers, and hard
disk drives; defense and aerospace applications, such as satellites,
guidance and control systems, and global positioning systems; and
advanced water treatment technologies for use in municipal wastewater,
industrial wastewater, pool & spa, and outdoor recreation applications.
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
Molycorp's 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: the potential need to secure additional capital to implement
Molycorp's business plans, and Molycorp's ability to successfully secure
any such capital; Molycorp's ability to complete its planned capital
projects, such as its initial modernization and expansion efforts,
including the achievement of an annual production capacity of 19,050
metric tons at its Mountain Pass, California rare earth mine and
processing facility, or the Molycorp Mountain Pass facility, which
management refers to as Project Phoenix Phase 1, and the second phase
capacity expansion plan, which management refers to as Project Phoenix
Phase 2, and reach full planned production rates for REO and other
planned downstream products, in each case within the projected time
frame; the success of Molycorp's cost mitigation efforts in connection
with Project Phoenix, which if unsuccessful, might cause its costs to
exceed budget; the final costs of Molycorp's planned capital projects,
such as Project Phoenix Phase 1 and Project Phoenix Phase 2, which may
differ from estimated costs; Molycorp's ability to successfully
integrate Neo Material Technologies, Inc. (now Molycorp Canada), with
its operations; Molycorp's ability to achieve fully the strategic and
financial objectives related to the acquisition of Molycorp Canada,
including the acquisition's impact on Molycorp's financial condition and
results of operations; and unexpected costs or liabilities that may
arise from the acquisition, ownership or operation of Molycorp Canada.
Also as a result of the Molycorp Canada acquisition, Molycorp's business
performance may be materially affected by a number of other factors and
uncertainties including, but not limited to: the rate of exchange of the
U.S. dollar to the Canadian dollar, the Japanese yen, and the Chinese
Renminbi; new products pricing; the competitive environment for these
new products; unexpected actions of domestic and foreign governments;
and various events which could disrupt operations, including natural
events and other risks. Other risk factors and uncertainties that may
cause actual results to differ materially from expected results include:
uncertainties associated with Molycorp's reserve estimates and
non-reserve deposit information, including estimated mine life and
annual production; uncertainties related to feasibility studies that
provide estimates of expected or anticipated costs, expenditures and
economic returns, REO prices, production costs and other expenses for
operations, which are subject to fluctuation; uncertainties regarding
global supply and demand for rare earths materials; uncertainties
regarding the results of Molycorp's exploratory drilling programs;
Molycorp's ability to enter into additional definitive agreements with
its customers and its ability to maintain customer relationships;
Molycorp's sintered neodymium-iron-boron rare earth magnet joint
venture's ability to successfully manufacture magnets within its
expected timeframe; Molycorp's ability to successfully integrate other
acquired businesses; 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,
2011 and of the Company's Quarterly Reports on Form 10-Q. Any
forward-looking statement contained in this release or the Annual Report
on Form 10-K or the Quarterly Reports 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, +1-303-843-8062

Vice
President, Corporate Communications

Jim.Sims@Molycorp.com

or

Brian
Blackman, ?+1-303-843-8067

Senior Manager, Investor
Relations

Brian.Blackman@molycorp.com