Molycorp Announces Proposed Offering of $200 Million of Convertible Senior Notes Due 2016

Molycorp, Inc. (NYSE: MCP), the Western hemisphere's only producer of
rare earth oxides, today announced that, subject to market conditions,
it intends to offer $200 million principal amount of its Convertible
Senior Notes due 2016 (the 'Notes?) in an offering exempt from the
registration requirements of the Securities Act of 1933. The Notes are
being offered only to qualified institutional buyers pursuant to Rule
144A under the Securities Act of 1933. In addition, Molycorp intends to
grant the initial purchasers of the Notes an option to purchase an
additional $30 million principal amount of the Notes.

The Notes will pay interest semi-annually and will be convertible into
shares of Molycorp′s common stock, cash, or a combination thereof, at
Molycorp′s election. The Notes will mature on June 15, 2016, unless
earlier repurchased or converted. Molycorp will not have the right to
redeem the Notes prior to maturity.

Molycorp expects to use the net proceeds from the proposed offering to
fund its original Phase 1 production capacity plan as well as its Phase
2 expansion plan at its Mountain Pass, California processing facility.
Any remaining net proceeds will be used for general corporate purposes.

The Notes and the shares of common stock issuable upon conversion of the
Notes have not and will not be registered under the Securities Act of
1933 and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements. This press release shall not constitute an offer to sell
or a solicitation of an offer to buy such securities and is issued
pursuant to Rule 135c under the Securities Act of 1933.

About Molycorp

Colorado-based Molycorp, Inc. is the only REO producer in the Western
Hemisphere and currently produces more than 3,000 metric tons of
commercial rare earth materials per year. In addition to its flagship
rare earth mine and processing facility at Mountain Pass, California,
Molycorp also owns a controlling interest in the Estonia-based Molycorp
Silmet AS, which has a production capacity of 3,000 metric tons of rare
earth products and 700 metric tons of rare metal products annually and
is one of the largest rare metal and rare earth metal producers in
Europe. Additionally, Molycorp owns and operates Arizona-based Molycorp
Metals and Alloys, one of the leading producers of high-purity rare
earth alloys and metals outside of China. Following the execution of
Molycorp's 'mine-to-magnets' strategy and the expected 2012 completion
of Phase 1 of its modernization and expansion efforts at its Mountain
Pass, California processing facility, the Company expects to produce at
a rate of approximately 19,050 metric tons of REO equivalent per year
from Mountain Pass. The Company expects to achieve an annual production
capacity at Mountain Pass by the end of 2013 of approximately 40,000
metric tons of REO equivalent per year after the completion of Phase 2.
Molycorp intends to provide to the market a range of rare earth
products, including high-purity oxides, metals, alloys, and permanent
magnets. The Company currently sells products to customers in Europe,
North and South America, Asia, Russia, and other previous nations of the
Soviet Union.

Molycorp Inc.

Jim Sims, 1-303-843-8067

Director of
Public Affairs,

Jim.Sims@Molycorp.com

or

Investor
Relations

ICR, LLC

Gary T. Dvorchak, CFA, 1-310-954-1123

Senior
Vice President

Gary.Dvorchak@icrinc.com