Ucore Rare Metals (TSXV:UCU) is a junior explorer looking for rare earth deposits in North America, and is primarily focused on its Bokan-Dotson Ridge REE property in Alaska.Why this stock is appealing: With the majority of REE projects still a long way from production, Ucore has stated that its Bokan deposit — the largest heavy rare earth element (HREE) project in the United States — is targeting production in the near term. Bokan is one of only a handful of non-Chinese HREE deposits capable of attaining production within the next three to four years, according to the company. In November, Ucore released a preliminary economic assessment for the project that shows a net present value of $577 million and an internal rate of return of 43 percent — impressive economics in a struggling market environment. Investors also began to take note earlier this year, when the company announced that the US Department of Defense (DOD) signed a contract to conduct a mineralogical and metallurgical study on Bokan. The DOD is hands down one of the world's most attractive global customers for HREEs. While Ucore is actively discussing offtake partner agreements with a number of American industrial manufacturers, the DOD alone could be a significant consumer of the company's output. A partnership with the DOD would also eliminate a lot of the risk associated with this project — and would set Ucore apart from its competitors. While the company performed well in 2012′s negative market environment, it still holds massive upside potential in the medium to long term. Ucore has 152,633,403 shares outstanding and a market capitalization of $74.79 million. The company's shares are currently priced at 50 cents, well above its 52-week low of 22 cents and well below its one-year high of 64 cents. Matamec Explorations (TSXV:MAT) is a junior exploration company whose main focus is its Kipawa deposit in Quebec. Most of the Kipawa deposit's value is in five critical REEs, including dysprosium and terbium, which are indispensable in green technology applications. Why this stock is appealing: This undervalued firm boasts a high-quality project, an already-established customer base and near-term production goals. Its flagship project has projected revenue of $2.8 billion, a before-tax payback period of only 2.4 years and a mine life of approximately 13 years.