Texas Rare Earth Resources Provides Update on Round Top Project Advancement and Business Plan

Texas Rare Earth Resources Corp. (OTCQX: ?TRER) believes that the
fundamentals of the heavy rare earth sector remain the same as they were
in early 2011. The much talked about projected short falls of supply of
these critical heavy rare earth elements have not been addressed. The
Company believes that there was not then, and there is not now an
obvious long term source of these metals, particularly the elements
Yttrium and Dysprosium. The recently completed June 15, 2012 Preliminary
Economic Assessment (the 'PEA?) by Gustavson Associates has defined our
Round Top project as a potential long term source of these two critical
elements and our primary objective going forward is to develop and tune
a process to extract these elements.

Subject to modification as circumstances dictate, our business plan
going forward will consist of the following elements.

UPDATE RESOURCE CALCULATIONS

In the PEA, using the first 35 of 65 drill holes completed by the
Company in 2011 and portions of the 82,000 feet of historical drilling
of previous owners, Gustavson Associates estimated 1,034 million metric
tonnes of measured, indicated and inferred resources containing 531
grams per tonne or 1,209 million pounds of rare earth elements (REE) at
our Round Top project.

In our press release of May 16, 2011 based on analytical data from nine
widely spaced, historic Cyprus Minerals drill holes, we summarized both
REE and non-REE mineral grades at our Round Top Project. That press
release reported 516.4 grams per tonne of total REE as well as the
following other elements:

On August 23, 2012, our management met with Gustavson Associates in
Denver, who are presenting a proposal for an updated resource estimate
to incorporate the final 30 drill holes and to incorporate uranium,
thorium, niobium, tantalum, tin and gallium which were not included in
the PEA.

The additional drilling has not resulted in values which vary
significantly from the previous work. We believe it is 'best practice?
to incorporate all of the 65 drill holes completed during 2011 and all
potential mineral products into our publicly disclosed information. We
anticipate that these data will be disclosed as soon as we finish
compiling them.

METALLURGICAL STUDIES

The PEA was based on a 80,000 metric tonne per day conventional
floatation mill followed by a hydromet refinery with estimated
recoveries of 64%, 72% and 79%, at a $2 billion capital cost. Although
the economics of this model are robust, we believe the $2 billion
capital cost and excessive size of this operation are drawbacks. This
model represents only one alternative that we will compare to others.

Our re-optimization goals include but are not limited to the following
metallurgical considerations:

#1 Conducting the metallurgical testing to establish the actual
recoveries of all potentially economic commodities from this rock.

#2 Incorporating recovery of non-REE minerals as referenced in the May
16, 2011 press release in the second 3rd party resource calculation that
we requested on August 23, 2012.

#3 Reducing unit capital costs by modifying or eliminating components
from the mine and plant as described in the PEA.

#4 Reducing the absolute capital costs by evaluating smaller scale
operations.

#5 Minimizing process risks that have caused startup delays to other
mines. For example, high pressure grinding rolls and hydromet processes
that have not met design standards in initial years at some other mines.
A simplified process that bypasses such stages reduces risks to
shareholders.

#6 Examining the feasibility of producing a concentrate either by
physical or chemical methods to produce a marketable bulk product.

#7 Minimizing environmental impacts in multiple ways, including (a)
minimum water use, (b) maximum recovery rates to simplify tailings
disposal, (c) minimum plant footprint, and (d) a low startup processing
rate to reduce environmental impacts.

#8 Analyzing the risk-adjusted rates of return of each process phase. We
believe Round Top offers the highest rates of return from extraction and
concentration, and potentially much less return from final refining if
overseas traders or local partners offer reasonable terms to buy
concentrates.

These considerations incorporate the twin goals of minimizing risk and
improving returns. We believe that the highest standards of
environmental protection minimize risks most importantly, as lengthy
environmental permit delays prevent job creation, delay royalty and tax
revenues to the benefit of the State of Texas and delays other benefits.

No future economic analysis will be reliable unless metallurgical
recovery rates and the process flow chart have been documented to
rigorous standards. For this reason our greatest efforts in the next
year will be toward metallurgical process development. Our process
design considerations involve many factors, and we will not rush any
evaluation until we develop a high level of confidence that our
scientists have unlocked the full values.

The 'time line? slide #21 of our June 15, 2012 PEA presentation has
become out of date. We contemplate a longer period of up front research,
comparisons and 'validation testing? of metallurgical processes prior to
any final decisions in plant design or 'plan of operations? that may be
submitted to environmental regulatory agencies. We are optimistic that a
smaller scale of operation, higher process recovery rates for non-REE
and better design will shorten and simplify permitting. We have no
specific timetable and have no plans to communicate such until
definitive metallurgical testing and flow chart design have been
completed.

URANIUM POTENTIAL OF THE RHYOLITE

Based on our PEA estimate of 1,034 million metric tonne of resources,
the prior May 16, 2011 preliminary estimate of 44.6 grams per tonne of
uranium the Round Top rhyolite may contain an estimated 101.6 million
pounds of uranium. Indications of acceptable uranium recovery in acid
leach circuits, make it possible that uranium, because of its assured
market, is a potentially important component of the economic model.

The potential estimated 101.6 mm lb of uranium, if and when documented
as a mineral resource, would rank Round Top approximately 15^th
in the World Nuclear Association′s rankings of uranium deposits by
country, or approximately the same as Mongolia. We have added a uranium
discussion to our web site at http://trer.com/our-projects-2/uranium-round-top/
with links to the World Nuclear Association web site. We may incorporate
more discussion pending the results of the new resource estimate and
after metallurgical recovery tests.

We have had preliminary information exchanges with three publicly traded
uranium producers with over $10 billion in combined annual revenues and
one developmental company with documented resources similar in size to
our own undocumented estimated resource. No representative of any of
these four companies has visited Round Top, but we welcome their
interest.

Of course, it is premature for either them or us to entertain any ideas
in detail until an independent third party documents the grade of
uranium and metallurgical testing demonstrates the possible recoveries.
At this stage we merely seek to make new friends or renew old
relationships. Our chairman has acted as a financial advisor to two of
these four other companies in the past.

We have great respect for the uranium industry, which operates to very
high standards owing to public health and safety considerations. Some
companies have long track records, diverse lines of business and deep
competence.

OPPORTUNITIES FOR JOINT DEVELOPMENT OF EXPLORATION POTENTIAL OF THE
ROUND TOP PROPERTY

Although we have no plans in the next 24 months to conduct more physical
exploration, as our 1,034 million metric tonne resource is adequate for
any future economic projections we do believe, as stated in our 2010
presentations, that there are untested exploration targets present. They
are:

1. Uranium-beryllium mineralization at the lower contact of the rhyolite
and the underlying sedimentary rock. This class of mineralization was
the target of the successful exploration program conducted in the late
1980's by Cabot Corporation and Cyprus Exploration. It appears to be
structurally controlled and associated with a later phase of
hydrothermal or gas phase deposition that occurred sometime after the
emplacement of the rhyolite. This fluorite-beryllium replacement
mineralization in what is termed the West Side Fault under the north
side of Round Top was the topic of a 1988 definitive feasibility study
by Cyprus Minerals to historical standards (not NI 43-101 compliant
under today′s Canadian regulations) to produce beryllium. This zone is
the location of the intact decline and lateral mine workings developed
by Cyprus Minerals in 1988-89. Sampling and analysis by TRER indicates
the presence of potentially economic grades of uranium occurring
adjacent to and likely associated with these beryllium bearing
structures. This 'Contact Zone' mineralization is not restricted to
Round Top and is present under the Sierra Blanca rhyolite and there is
some evidence in drill holes on Little Blanca that this style of
mineralization may also be present there.

2. Uranium-beryllium-rare earth and other rare metals hosted as
structurally controlled fluorite replacements in the limestones at depth
below the known deposits. Geologic and geochemical conditions are
thought to be condusive for the emplacement of replacement type deposits
within the same fault zones that hosted the known beryllium-uranium
deposits at depth where favorable host limestones are present. We
believe that careful compilation and analysis of existing surface
geologic mapping and of the drill data may better define these targets.

3. Additional tonnage of rhyolite containing rare earth and other rare
metals. Round Top is one of four principal rhyolite bodies making up the
group of mountains known as The Sierra Blanca. Two of them, Round Top
and the smaller Little Round Top we believe are similar in rare metal
content. Based on sparse data seen to date, Little Blanca appears to be
similar but slightly lower in total metal content and is less enriched
in the 'heavy' rare earths. Little Blanca is thought to have a mass
similar to Round Top. The large Sierra Blanca rhyolite intrusion, again
based on sparse data, is thought to contain some thirty percent less
rare earth and other metals and at a considerably lower 'heavy' content.
It should be noted that data points on these other rhyolite masses are
few and any conclusions are highly speculative as to their size and
content. However, should we be successful in developing a method to
process the Round Top rhyolite, it is likely that this process would be
applicable to the other mineralogically similar rhyolites masses. In
addition, magnetic and gravity surveys indicate that there may be other
rhyolite bodies in the subsurface that would have to be tested by later
drilling.

We believe that using the existing data we can improve our understanding
of the exploration potential of the area without resorting to such
expensive techniques as drilling.

Our Board of Directors may invite and consider proposals from other
companies to evaluate those additional zones.

MACHO SILVER PROPERTY

We will contact silver mining companies, a royalty company, direct
investors and startup silver exploration companies to evaluate
alternatives for the Macho silver-lead-zinc-gold property in Sierra
County, New Mexico that was our primary asset prior to our leasing of
the Round Top deposit in October 2010.

We have reposted its presentation on our web site at http://trer.com/wp-content/uploads/2012/08/TRER-Macho_Presentation-Aug-5-2009.pdf.
This past producing mine is an exploration target that could support
potentially an estimated 100 metric tonne per day mine and mill to
produce potentially an estimated 0.5 mm oz of silver annually. The
galena type silver-lead-zinc-gold minerals have zones of high lead
values, where an efficient operator skilled in narrow vein mining may be
able to recover all costs from lead revenues where the silver revenues
could benefit owners. Three historic shafts went to 100, 300 and 525
foot depths. We are not aware of any drilling or evaluations in the past
70 years. There are no known reserves, resources or commercial studies
to modern standards.

Our objective is to monetize the Macho property to help fund our 2014 or
2015 future activities. Further, our recent share price does not reflect
the value of the Macho opportunity.

CLOSURE OF COLORADO OFFICE AND REDUCTION OF EXPENSES

We do not believe we can attract investor financing to maintain a large
corporate staff during a lengthy pre-revenue period where most
metallurgical, design, feasibility study, engineering and permitting
activities will be led by outside consultants.

Further, our management policy is 're-Texafication? where we will
shorten lines of communication and improve oversight. Two of our
directors are faculty at The University of Texas at El Paso, where we
have in the past employed geology students to staff the drilling
program. We expect our streamlined organization will be more effective.

Effective August 31, 2012, our offices at 304 Inverness Way South, Suite
365, Englewood, CO are to be phased out. Our Sierra Blanca, Texas office
at 539 El Paso Street, Sierra Blanca, TX 79851 will become our official
address and our principal operational office where Jamie May will
continue as office manager. Our principal daytime contact number will be
915-369-2133. The El Paso warehouse located at 11459 Pellicano Dr., El
Paso, Texas will also be phased out. We anticipate moving our accounting
functions to our former office in Tyler, Texas under the supervision of
our largest current shareholder and former CFO, G. W. McDonald. Our
primary investor contacts are our chairman, John Tumazos at 732 444
1083, and our President and CEO, Dan Gorski at 361 790 5831.

The current management is shareholder-centric, and receives either no
cash compensation or much less than previous management. We look to the
share price to rise as the principal mechanism for wealth creation. We
will require definitive scientific documentation, rigorous economic
studies, consideration of a wide range of alternatives and meticulous
oversight of any cash outlays of shareholder funds.

STATE OF FINANCES AND POTENTIAL FUTURE REVENUE

Our most recently disclosed cash balances of August. 31, 2012 were
approximately $6.5 million, and we anticipate cash balances larger than
$5.5 million at the end of calendar 2012 net of all expenses related to
the closure of our Colorado office and severances.

We will strive to reduce our monthly cash consumption from near $1.0
million during the active drilling phase to approximately $135,000 per
month plus specific technical study payments, lease payments or
discretionary items as may appear. We estimate maintenance of
comfortable cash balances at least into calendar 2014.

Our policy will be not to issue common stock < $2.50 per share. If we
cannot attract investment capital on favorable terms, we will evaluate
other potential sources of financing that may include:

(1) early exercise of warrants by shareholders;

(2) sales of royalties on Macho Silver, REE or non-REE elements as may
be subsequently documented;

(3) sale of the Macho Silver property;

(4) JV or sale of the 'Contact Zone? enriched in beryllium and uranium
that was the earlier subject of Cyprus Minerals 1988 historical
definitive feasibility study and;

(5) based on our experience in operating 'narrow vein' deposits,
possible participation in other mining ventures as operators for or
partners with other investors or companies.

LEGAL DISCLAIMERS

• Cautionary Note to Investors

The United States Securities and Exchange Commission ('SEC?) limits
disclosure for U.S. reporting purposes to mineral deposits that a
company can economically and legally extract or produce. This press
release uses terms that comply with reporting standards in Canada and
certain estimates are made in accordance with Canadian National
Instrument 43-101 ('NI 43-101?) and the Canadian Institute of Mining,
Metallurgy and Petroleum ('CIM?) - CIM Definition Standards on
Mineral Resources and Mineral Reserves, adopted by the CIM Council,
as amended (the 'CIM Standards?). This press release uses the terms
'mineral resource,? 'measured and indicated mineral resource,? and
'inferred mineral resource.? We advise U.S. investors that while these
terms are defined in accordance with NI 43-101 such terms are not
recognized under the SEC′s Industry Guide 7 and are normally not
permitted to be used in reports and registration statements filed with
the SEC. Mineral resources in these categories have a great amount of
uncertainty as to their economic and legal feasibility. 'Inferred
resources? have a great amount of uncertainty as to their existence and,
under Canadian regulations, cannot form the basis of a pre-feasibility
or feasibility study, except in limited circumstances. The SEC normally
only permits issuers to report mineralization that does not constitute
SEC Industry Guide 7 compliant 'reserves? as in-place tonnage and grade
without reference to unit measures. Under SEC Industry Guide
7 ?standards, a 'final? or 'bankable? feasibility study is required to
report reserves, the three-year historical average price is used in any
reserve or cash flow analysis to designate reserves and all necessary
permits and government approvals must be filed with the appropriate
governmental authority. None of our projects currently contain any known
proven or probable ore reserves under SEC Industry Guide 7 reporting
standards. The results of the PEA disclosed in this press release are
preliminary in nature and include inferred mineral resources that are
considered speculative geologically to have the economic considerations
applied to them that would enable them to be categorized as mineral
reserves and there is no certainty that the results of the PEA will be
realized. Estimates of uranium occurring in this press release are based
on an analysis of limited, historical drill holes at the Round Top
project and may not be indicative of mineralization throughout the
project area. Estimates of potential production at the Macho silver
property are based on historical data. There are no known resources or
reserves at the Macho silver property. U.S. investors are urged to
consider closely the disclosure in our latest reports and registration
statements filed with the SEC. You can review and obtain copies of these
filings at http://www.sec.gov/edgar.shtml.
U.S. Investors are cautioned not to assume that any defined resource
will ever be converted into SEC Guide 7 compliant reserves.

• Forward-Looking Statements

This press release contains forward-looking statements within the
meaning of the U.S. Securities Act of 1933, as amended, and U.S.
Securities Exchange Act of 1934, as amended. The potential iterations of
re-optimization, future revisions to the PEA, the inclusion of
additional drill holes into mineral estimates, estimates of REE and
non-REE resources, future rare element estimates not varying
significantly from past estimates, potential exploration targets,
potential Uranium-Beryllium mineralization, potential additional tonnage
of rhyolite, re-optimization goals, including documenting metallurgical
recovery rates, incorporating non-REEs, reducing capital costs,
producing a concentrate either by physical or chemical methods to
produce a marketable bulk product, and minimizing environmental risks,
the anticipated focus on metallurgical development, testing, and
verification, possible pounds of uranium at the Round Top project,
possible mine production averages at the Macho silver property, contacts
for alternatives for the Macho property, and anticipated burn rates and
sources of future financing are forward-looking statements. These
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements
of the Company to be materially different from any future results,
performance or achievements expressed or implied by such statements.
Such factors include, among others, uncertainty of mineralized material
and mineral resource estimates, risks relating to completing
metallurgical testing at the Round Top project, risks related to project
development determinations, risks related to fluctuations in the price
of rare earth minerals, Uranium and other non-REE minerals present at
the Company′s projects, the inherently hazardous nature of
mining-related activities, potential effects on the Company′s operations
of environmental regulations, risks due to legal proceedings, risks
related to uncertainty of being able to raise capital on favorable terms
or at all, as well as those factors discussed under the heading 'Risk
Factors? in the Company′s quarterly reports on Form 10-Q as filed on
April 16, 2012, and July 16, 2012 and the Company′s latest annual report
on Form 10-K as filed on November 22, 2011 and other documents filed
with the U.S. Securities and Exchange Commission. Although the Company
has attempted to identify important factors that could cause actual
results to differ materially from those described in forward-looking
statements, there may be other factors that cause results not to be as
anticipated, estimated or intended. Except as required by law, the
Company assumes no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events, or
otherwise.

Texas Rare Earth Resources Corp.

Dan Gorski

361-790-5831

dgorski@trer.com