QUANTUM UPDATES ELK CREEK ACQUISIITON, ANNOUNCES PRIVATE PLACEMENT

September 21, 2010 – Vancouver, B.C.:  Quantum Rare Earth Developments Corp. (TSX.V – QRE, FSE – BR3) (“Quantum”, the “Company”) is pleased to announce receipt of conditional acceptance from the TSX Venture Exchange (the “Exchange”) of the Company’s previously announced acquisition of the Elk Creek Carbonatite project, located south of Lincoln, Nebraska (see NR May 4, 2010).  Final acceptance of the acquisition will occur upon the Company satisfying certain Exchange conditions, including the closing of a private placement, details of which are noted below.

The Elk Creek Carbonatite, located in southeastern Nebraska, is an intrusive complex of carbonatite and related rocks and is host to significant niobium and rare earth element (REE) mineralization.  The Elk Creek Carbonatite is evidenced by diamond drilling in an oval-shaped magnetic and gravity anomaly approximately 7 kilometers in diameter, making it one of the largest known carbonatite complexes. 

Historic exploration of the property was conducted by the State of Nebraska, Cominco American and Molycorp, Inc. during the 1970’s and 1980’s.  At least 113 core holes, totaling in excess of 150,000 feet, were completed within the outline of the 7-kilometre diameter geophysical anomaly.  Detailed drilling of 25 holes was completed within a core zone, which identified high-grade niobium mineralization. This drilling resulted in a historic resource estimate of “39.4 million tons of 0.82% Nb2O5 and is open to the north, west and at depth” (Molycorp, Inc. internal memorandum, Feb 05/1986).

A NI 43-101 report on the Elk Creek Carbonatite has been filed at the Exchange on behalf of the Company and will be available shortly on the corporate website (www.QuantumRareEarth.com) and on SEDAR.

PRIVATE PLACEMENT: 

In conjunction with the conditional approval of the acquisition, the Company is pleased to announce that it has arranged a brokered private placement with MGI Securities of Toronto.  The placement will consist of up to 3,500,000 flow-through units (the “Flow-Through Units”) at a price of $0.30 per Flow-Through Unit for gross proceeds of up to $1,050,000 and up to 8,000,000 non flow-through units (the “Hard Dollar Units”) at a price of $0.25 per Hard Dollar Unit for gross proceeds of up to $2,000,000.

Each Flow-Through Unit will consist of one flow-through share (a “Flow-Through Share”) which qualifies as a “flow-through share” for tax purposes of the Income Tax Act (Canada), and one-half of one common share purchase warrant (a "FT Warrant").  Each full FT Warrant will entitle the holder thereof to purchase one non flow-through common share in the capital of the Company for a period of 36 months from the Closing Date of the Offering at an exercise price of $0.40 per common share.

Each Hard Dollar Unit will consist of one common share and one-half of one common share purchase warrant (a “NFT Warrant”).  Each full NFT Warrant shall be exercisable into one common share at a price of $0.35 per common share for a period of 36 months from the Closing Date.

Proceeds of the flow-through private placement will be used for qualified exploration expenditures on the Archie Lake, Saskatchewan rare earth project (see NR July 6, 2010).  Proceeds of the non flow-through private placement will be used to advance the Elk Creek Carbonatite project and for general working capital.

MGI will receive a cash commission of 8% of the total gross proceeds raised and compensation warrants equal to 10% of Flow-Through and Hard Dollar Units sold.  Each Hard Dollar compensation warrant will entitle MGI to acquire one Hard Dollar Unit of the company, and each Flow-Through compensation warrant will entitle MGI to acquire one Flow-Through Unit of the Company, on the same terms and conditions as the respective private placements.

About MGI Securities Inc. 
MGI Securities Inc. is an integrated Canadian investment dealer offering professional wealth management solutions for individual investors, a comprehensive range of specialized services for institutional investors, and corporate finance advisory services for issuers, including mergers and acquisitions, equity underwritings, corporate restructuring, structured financings, market research, and business valuation services. MGI is based in Toronto, with additional offices in Winnipeg, Saskatoon, Calgary and London, Ontario. MGI is a member of IIROC and is a subsidiary of Jovian Capital Corporation (TSX: JOV). MGI has approximately $1.1 billion in client assets under administration.

Acquisition of Elk Creek Resources. 
The acquisition by Quantum involves a 3-cornered amalgamation between the Company, 0886338 BC Ltd., the Company’s wholly-owned subsidiary, and 0859404 BC Ltd., a private British Columbia company that holds 100% of the issued and outstanding shares of Elk Creek Resources Corp.  Elk Creek is a Nebraskan corporation that has secured individual agreements to acquire the mineral rights to the Elk Creek Carbonatite.  The agreements are in the form of a five-year pre-paid lease, with an option to purchase the mineral rights at the end of the lease.  The property was held under a similar type of option agreement by Molycorp, Inc. in the 1970’s and 1980’s.

Upon completion of the amalgamation, the Company will issue a total of 18,990,539 common shares in exchange, on a one for one basis, of all the issued and outstanding shares of 0859404 BC Ltd.  The Company has also paid a total of $500,000 to 0859404 BC Ltd.

The transaction will not constitute a change of control of Quantum, nor will it create any new control position shareholders of Quantum.  The transaction is not a non-arms-length transaction. 
A finders fee in accordance with TSX Venture Exchange policy will be payable on this acquisition.

For further information on Quantum, contact Peter Dickie, President and CEO at (604) 669-9330.  

For further information on the Private Placement, please contact John McMahon, Investment Banker, at (416) 777-5178, This e-mail address is being protected from spambots. You need JavaScript enabled to view it

On Behalf of the Board,

“Peter Dickie”
Peter Dickie, President, CEO

“Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."