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• Water Licence for Prairie Creek Mine approved
• Drilling programs underway at South Tally Pond
• Agreement to acquire Messina Minerals
Vancouver, British Columbia, November 15, 2013 – Canadian Zinc Corporation (TSX: CZN; OTCQB: CZICF) (“the Company” or “Canadian Zinc”) announces its financial results for the three month and nine month periods ended September 30, 2013.
Financial Results September 30, 2013
For the three and nine month periods ended September 30, 2013, the Company reported a net loss and comprehensive loss of $1,626,000 and $3,507,000 respectively compared to a net loss and comprehensive loss of $621,000 and $12,576,000, respectively for the same periods ended September 30, 2012.
The net loss in the three month period ended September 30, 2013 included a gain of $348,000 on the Company’s marketable securities compared to a gain of $3,032,000 for the comparative period. For the three and nine month periods ended September 30, 2013, the Company expensed $1,286,000 and $3,391,000 respectively on its exploration and evaluation programs at Prairie Creek compared to $3,376,000 and $6,492,000, respectively for the same periods ended September 30, 2012.
The net loss in the nine month period ended September 30, 2013 included a loss of $3,430,000 on the Company’s marketable securities compared to a loss of $4,998,000 for the comparative period. The Company also recorded a gain of $5,439,000 on the sale of a net smelter royalty for the nine month period ended September 30, 2013.
Excluding the gain or loss on marketable securities and the gain on the sale of the Royalty, the Company recorded a net loss of $1,974,000 in the third quarter of 2013 and a net loss of $5,516,000 in the nine months ended September 30, 2013, compared to net losses of $3,653,000 and $7,578,000 in the same periods last year. At September 30, 2013, the Company had a positive working capital balance of $14,452,000 including cash and cash equivalents of $12,855,000, short term investments of $1,000 and marketable securities of $1,704,000 (for a total of $14,560,000).
Permitting Process Complete
After the successful completion of a five year environmental assessment and regulatory process established under the Mackenzie Valley Resource Management Act Canadian Zinc now holds all the necessary permits and licences to allow for the construction, development and operation of the Prairie Creek Mine and the entire 184 kilometre access road which connects the Prairie Creek Property to the Liard Highway.
Water Licence and related Operational Land Use Permits
In September 2013, the Company received notification that the Honourable Bernard Valcourt, Minister of Aboriginal Affairs and Northern Development Canada, approved and signed the Type “A” Water Licence for the Prairie Creek Mine in the Northwest Territories, Canada. The Type “A” Water Licence, MV2008L2-002, was issued by the Mackenzie Valley Land and Water Board (“MVLWB” or the “Water Board”) in July, 2013 and, with this approval by the Minister, Canadian Zinc is permitted to conduct mining, milling and processing activities at the Prairie Creek Mine Site, use local water, dewater the underground mine and dispose of waste from mining and milling. This licence is valid for a period of seven years.
This Type “A” Water Licence and Land Use Permit are the key regulatory permits needed for the construction, development and operation of the Prairie Creek Mine. The successful completion of the regulatory process is the culmination of many years of effort by the Canadian Zinc team, the MVLWB, the various government agencies and all the stakeholders in the region. The positive recommendation of the Water Board demonstrates that a broad consensus has been achieved through the process.
Parks Canada Road Land Use Permit and Water Licence
In September 2013, the Company received permits from Parks Canada, Parks2012_W001 WL and Parks2012-L001 LUP, both valid for a period of five years valid until August, 2018. The permits authorize road access through the NNPR to connect sections of road outside the Park permitted by the MVLWB.
Prairie Creek Site Activity
The Prairie Creek Mine site was re-opened in June 2013. Site work included care and maintenance programs, water treatment, servicing, repair and site re-organization, removal and relocation of equipment and supplies and training programs. These programs are ongoing; however, the site is expected to close for the season by the end of November.
From September to early October, the Company completed a small exploration diamond drill program close to the mine site to test an electromagnetic anomaly, defined by last year’s geophysical surveys. Two drillholes totaling 1,068 metres of coring were completed to test this anomaly with assay results pending. No obvious explanation was revealed to explain the anomaly but some zones within the sedimentary rocks contained moderate amounts of graphite which may be causing the anomaly.
In August 2013, Canadian Zinc closed its previously announced bought deal private placement of flow-through shares with Canaccord Genuity Corp. The Company issued 6,460,000 common shares, which qualify as “flow-through” shares of the Company for purposes of the Income Tax Act (Canada) at a price of $0.62 per FT Share, raising aggregate gross proceeds of $4.0 million.