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Canadian Zinc Updates on Prairie Creek Mine Site Operations

Canadian Zinc Corporation (TSX:CZN)(OTCBB:CZICF) has reported on the progress on the ongoing Environmental Assessment of the proposed Prairie Creek zinc/lead/silver mine, and to provide an update on the 2010 Prairie Creek site activities and exploration program.

Prairie Creek Environmental Assessment Update

The proposed development and operation of the Prairie Creek Mine is currently undergoing Environmental Assessment by the Mackenzie Valley Environmental Impact Review Board ("Review Board") (see June 2, 2010 press release).

Following submission and acceptance of Canadian Zinc's Developer's Assessment Report, the Environmental Assessment proceeded with the first round of Information Requests.

A total of 131 Information Requests from various government departments and regulatory agencies were received on July 23, 2010. The Company's responses to the Information Requests were submitted to the Review Board on September 13, 2010. A series of Technical Meetings involving all interested parties were then held by the Review Board in the community of Dettah, near Yellowknife, over three days from October 6 to 8, 2010, at which detailed technical reviews and discussions were carried out.

On October 20, 2010 the Review Board published the invitation for a Second Round of Information Requests, focusing on the information presented during the Technical Meetings. Parties are asked to submit their focused Information Requests to the Review Board by October 29 and the Company has been asked to provide its responses to the Review Board by November 29, 2010.

Prairie Creek Mine Site-- Operations Update

Activities at the Prairie Creek mine site during the summer of 2010 included ongoing water treatment, road building and repair, equipment refurbishment, building up-keep, and general site care and maintenance.

Further repair work to the mine access road was completed, specifically adjacent to the Prairie and Funeral creeks. In addition a new eight kilometre long access road to the new drill pad at Casket Creek was constructed.

In August a perimeter land survey was completed on the Gate mineral claims, which cover 9,245 hectares located to the west of the Prairie Creek mine, to initiate the process of converting these mineral claims to mining leases. The Gate Claims contain similar geology to that of the Prairie Creek mine and grassroots exploration developed new base metal targets some of which still remain underexplored. The proximity of these claims to the Prairie Creek Mine, and the similarities in geology, justify upgrading the mineral tenure of these claims to long term mining leases.

A recent program was undertaken to remove, by airlift, all PCB contaminated material that has been stored in a dedicated safe facility on site since 1982. This follows a similar program that removed all old cyanide from the site in 2008 (refer to August 21, 2008 press release). The Company contracted Hazco Environmental Services to repackage, remove and transport the PCB material off-site to be disposed of, by incineration, at the certified Earth Tech Swan Hills disposal facilities in Northern Alberta.

New bulk rock and water samples were collected from underground at the Prairie Creek Mine in order to perform more locked-cycle flotation tests to produce further representative products, including mill process water. The mill process water will be further analyzed and tested to determine the final water treatment scheme for the proposed mining operations. Additional site studies relating to hydraulic engineering, water storage pond facility and groundwater were completed, together with further engineering assessments along the road access route, including terrain, vegetation and creek crossing studies, carried out by various consultants during 2010.

More than 136,000 litres of diesel fuel were hauled into the Prairie Creek site by DHC-5 Buffalo aircraft to support further operations and, in preparation for the diamond drill program, an airlift of a new drill rig to the site was carried out.

On-going community relations continued throughout the year, including meetings, events, and community sponsorship programs. Particular emphasis was placed on follow-up to the previously signed Memoranda of Understandings with local communities through advancing negotiations towards concluding Impact Benefits Agreements.

2,700 Meters Completed in Deep Hole Exploration Program

The 2010 diamond drill exploration program was designed to test for extensions of the inferred vein mineral resource to the north the Prairie Creek Mine, where the host geology and structure are projected to continue at depth, approximately 1.5 kilometres north of the last drill hole within the currently defined mineral resource.

Since the target geology was projected to occur at a depth beyond the reach of the Company's existing drills a new higher capacity HTM2500 diamond drill rig was airlifted to the property. A drilling pad was selected at a location next to Casket Creek, a new eight kilometre long access road was constructed and diamond drilling at Casket Creek commenced in early August. To mid October 2010, 2,703 metres of drilling had been completed in three holes.

Drill hole PC-10-186 was successfully completed to a depth of 1,557 m. This hole intersected and confirmed the presence of the target Whittaker Formation, which hosts the majority of the defined mineral resource at the Prairie Creek mine, at a down hole depth of 1,500 m. New stratigraphical information at depth in this hole enabled determination of a more precise target location of the potential vein hosting structure.

A second wedged drill hole, PC-10-186W1, was redirected from the upper part of PC-10-186 and steered to the west toward the revised target location. Down hole technical problems were encountered after about 150 metres into the wedged hole, at an estimated depth of about 536 metres, forcing abandonment of this hole.

A third hole, PC-10-187, with a revised orientation, was collared at surface from the same drill pad and had reached a down hole depth of 652 metres when weather conditions created difficulties and concerns related to the eight kilometer drill access road and it was decided to suspend drilling activities until next season. The drill rig has been winterized and remains on location at the Casket Creek drill site.

The 2010 deep drilling exploration program has confirmed the presence of the host Whittaker geological formation at the projected horizon, about four kilometers north of the Prairie Creek Mine portal, and the potential vein target, projected to lie at a down hole depth of about 1,500 metres, remains untested. The nearest drill hole, PC-95-125 located approximately 1.5 kilometres to the south towards the Mine, drilled in 1995, returned multiple mineralized vein intersections 750 metres down the hole, including a 6.3 metre intercept grading 18.7% zinc, 8.5% lead and 239 grams per tonne silver. It is anticipated that the deep hole exploration program will continue in 2011 and hole PC-10-187 will be completed next year.

Qualified Person

Alan Taylor, P.Geo., Chief Operating Officer, Vice President Exploration and a Director of Canadian Zinc Corporation, is a Qualified Person for the purposes of National Instrument 43-101 and has approved this press release.

Source: Canadian Zinc Corporation


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