Mineral Processing Breakthrough Could Produce Larger Concentrations of Dysprosium, Praseodymium, Terbium and Neodymium at Quest's Mine Site

MONTREAL, QUEBEC--(Marketwired - May 23, 2017) - Quest Rare Minerals Ltd. (TSX:QRM) (Quest) is pleased to announce the identification of potentially significant improvements to the mineral processing flowsheet for its Strange Lake project. If realized, a concentrate better suited for hydrometallurgical processing with a higher grade of combined Dysprosium (Dy), Terbium (Tb), Praseodymium (Pr), and Neodymium (Nd), could be produced on-site at its proposed Strange Lake, Quebec, mining and milling facilities.

Recent geological, mineralogical and textural review and compilation of ongoing work completed by Quest has provided insights that could improve the mineral processing flowsheet as outlined in its technical report entitled "NI 43-101 Technical Report for the Updated Mineral Resource Estimate for the Strange Lake Property, Quebec, Canada" dated March 8, 2017, with an effective date of updated Resource Estimate of February 15, 2017 (the "Technical Report"). By targeting the host rock and textural characteristics of the minerals that predominantly include Dy, Tb, Pr, or Nd, instead of targeting Zirconium (Zr) and Total Rare Earth Elements (TREE), different handling and processing procedures could be utilized to improve the hydrometallurgical processing and Dy, Tb, Pr, and Nd grade of the concentrate. This is an important breakthrough because Dy, Tb, Pr and Nd are critical component metals of permanent magnets and Quest's management team believes that they are likely to make-up the large majority of the potential revenue. As a result it has been decided to incorporate these considerations prior to the completion of the recommended pilot plant work.

Once a limited number of comminution and flotation tests are completed, an integrated mini pilot will be undertaken to further define the optimal processing parameters. The pilot plant work will include the extraction of a 20-kilogram flotation concentrate at Corem, Québec City, which will be shipped to Outotec (Frankfurt, Germany) for sulphidation followed by Dy, Tb, Pr, and Nd extraction as separate metals. The pilot plant results will subsequently be used to update the Preliminary Economic Assessment (PEA) for the Strange Lake Project. Completion of this work can begin once sufficient financing has been secured. Updates will be disclosed at each stage.

In conjunction with, and to follow up this work, the geological, mineralogical, and textural data relevant to Dy, Tb, Pr, and Nd characterization and distribution within the mineral resource will be undertaken. Analogous to the mineral processing flowsheet, by targeting specifically the host rock and mineral associations of Dy, Tb, Pr, and Nd, instead of Zr and TREE, there could be unrealized differences to the current mineral resource characterization, distribution and classification as outlined in the Technical Report. Upon completion of this work, Quest will then determine the scope of work required to complete the prefeasibility study of the Strange Lake Project and identify potential updates to the mineral resource, if necessary.

Dirk Naumann, Quest Rare Minerals President, said, "This is an exciting development. We now have a chance to demonstrate the recovery and extraction potential of the Strange Lake Project and become the first producer of individual Dy, Tb, Pr and Nd metal concentrates in North America."

The scaling down to a mini-integrated pilot plant was decided following the notification that a significant financing agreement had been retracted after more than a year of negotiations. As previously disclosed, Quest entered into a Memorandum of Understanding ("MOU") on November 1, 2016, with a corporate investor who expressed interest in investing $ 7.5 million in the Company to enable Quest to complete its full-scale pilot plant project. In addition, the Memorandum of Understanding provided for follow-on investments to fund all or a portion of the additional capital required to complete the Bankable Feasibility Study with respect to the Strange Lake Project. The decision of this large industrial conglomerate with interests in construction, mining and oil not to proceed at this time was based solely on an internal strategic decision of the company regarding its investment priorities and does not reflect upon the technical or economic aspects of the Strange Lake Project. Quest is currently actively pursuing discussions with other organizations to finance the advancement of its Project.

Pierre Lortie, Chairman of the Board stated, "We are disappointed with the decision not to follow through with the terms of the Memorandum of Understanding at this juncture in time. We remain convinced that the Quest project is an excellent investment opportunity and, for Canada and Quebec, a chance to become a leading global specialist in the supply of Dy, Tb, Pr and Nd for the rapidly growing permanent magnet industry."

Technical information in this news release has been reviewed and approved by Edward Walker, Ph.D., P.Geo., Independent Qualified Persons as the term is defined in National Instrument 43-101.

ABOUT QUEST

Quest is a Canadian-based company focused on becoming an integrated producer of rare earth metal oxides and a significant participant in the rare earth elements (REE) material supply chain. Quest is led by a management team with in-depth experience in chemical and metallurgical processing. Quest's objective is the establishment of major hydrometallurgical and refining facilities in Bécancour, Québec, to separate and produce strategically critical rare earth metal oxides. These industrial facilities will process mineral concentrates extracted from Quest's Strange Lake mining properties in northern Québec and recycle lamp phosphors utilizing Quest's efficient, eco-friendly "Selective Thermal Sulphation (STS)"¹ process.

Forward-Looking Statements

This news release contains statements that may constitute "forward-looking information" or "forward-looking statements" within the meaning of applicable Canadian securities legislation. Forward-looking information and statements may include, among others, statements regarding the future plans, objectives or performance of Quest, including the Strange Lake Rare Earths Project's technical and pre-economic feasibility, future financing by Quest, or the assumptions underlying any of the foregoing. In this news release, words such as "may", "would", "could", "will", "likely", "believe", "expect", "anticipate", "intend", "plan", "estimate" and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur, including the development of the Strange Lake Rare Earths Project or any financing by Quest, or if any of them do so, what benefits Quest will derive from them.

Forward-looking statements and information are based on information available at the time and/or management's good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Quest's control. These risks, uncertainties and assumptions include, but are not limited to, estimates relating to capital costs and operating costs based upon anticipated tonnage and grades of resources to be mined and processed and the expected recovery rates, together with those described under "Risk Factors" in Quest's annual information form dated January 19, 2017, and under "Risk Factors" in Quest's Management's Discussion and Analysis for the fiscal year ended October 31, 2016, all of which are available on SEDAR at www.sedar.com, and could cause actual events or results to differ materially from those projected in any forward-looking statements. Quest does not intend, nor does Quest undertake any obligation, to update or revise any forward-looking information or statements contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable law.

¹ Patent Pending