Molycorp, Inc. 5619 DTC Parkway Suite 1000 Greenwood Village, CO 80111

Exhibit 10.16

March 11, 2011

Molycorp, Inc.
0000 XXX Xxxxxxx Xxxxx 0000
Xxxxxxxxx Xxxxxxx, XX
00000

The Selling Stockholders referred to in Schedule I hereto

Computershare Trust Company, N.A., as Custodian
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxxxxxxx

Dear Sir/Madam:

As representatives of the several underwriters (the “Underwriters”) listed in Schedule III to the Underwriting Agreement dated February 10, 2011 (the “Underwriting Agreement”) among Molycorp, Inc. (the “Company”), ourselves, as representatives of the Underwriters, and the selling stockholders named in Schedule I thereto, we hereby advise you that the Underwriters have determined to exercise the option granted to them in the Underwriting Agreement to purchase 2,025,000 additional shares of the Company’s common stock.

The Underwriters designate March 16, 2011 as the Option Closing Date pursuant to the Underwriting Agreement.

[Signature Pages Follow]

		Very truly yours,
		X.X. XXXXXX SECURITIES LLC XXXXXX XXXXXXX & CO. INCORPORATED
		As representatives of the several Underwriters
		By:		X.X. Xxxxxx Securities LLC
		By:		/s/ Xxxx Xxxxxxxxx
				Name: Xxxx Xxxxxxxxx
				Title: Managing Director

[Signature page to Notice of Exercise of Over-Allotment Option]

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		By:		Xxxxxx Xxxxxxx & Co. Incorporated
		By:		/s/ Xxxx Xxxxxx
				Name: Xxxx Xxxxxx
				Title: Managing Director

[Signature page to Notice of Exercise of Over-Allotment Option]

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Schedule I

RCF US Holdings X.X.		Xxxx X. Xxxxxx Partner Resource Capital Funds 0000 00xx Xxxxxx, Xxxxx 000 Xxxxxx, XX 00000
		With a copy to:
		Xxxxxx X. Xxxxxxxxx Chief Financial Officer Resource Capital Funds 0000 00xx Xxxxxx, Xxxxx 000 Xxxxxx, XX 00000
PP IV Mountain Pass II, LLC PP IV MP AIV 1, LLC PP IV MP AIV 2, LLC PP IV MP AIV 3, LLC		000 Xxxx Xxxxxx 00xx Xxxxx Xxx Xxxx, XX 00000 Attention: Xxxxx Xxxxxxxx, Esq.
		With a copy to:
		Xxxxx Xxx, Esq. Akin Gump Xxxxxx Xxxxx & Xxxx LLP Xxx Xxxxxx Xxxx Xxx Xxxx, XX 00000
TNA Moly Group LLC		Xxxx X. Xxxxxxxx Traxys North America 000 Xxxxx Xxxxxx Xxx Xxxx, XX 00000
Xxxx X. Xxxxxx		Xxxx X. Xxxxxx 000 Xxxxx Xxxxxx, Xxx. 0X Xxxx Xxxxx, XX 00000
Xxxx X. Xxxxxxxx		Xxxx X. Xxxxxxxx Traxys North America 000 Xxxxx Xxxxxx Xxx Xxxx, XX 00000
KMSMITH, LLC		KMSMITH LLC c/o Molycorp, Inc. 0000 Xxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxx 0000 Xxxxxxxxx Xxxxxxx, XX 00000 Attention: Xxxx X. Xxxxx
Xxxx X. Xxxxxxx		Xxxx X. Xxxxxxx, Xx. Molycorp, Inc. 0000 Xxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxx 0000 Xxxxxxxxx Xxxxxxx, XX 00000

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Xxxx X. Xxxxx		Xxxx X. Xxxxx Molycorp, Inc. 0000 Xxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxx 0000 Xxxxxxxxx Xxxxxxx, XX 00000
Xxxx X. Xxxxxxxx		Xxxx X. Xxxxxxxx c/o Molycorp, Inc. 0000 Xxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxx 0000 Xxxxxxxxx Xxxxxxx, XX 00000

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