Permitting

=20

The Company has continued with exploration on its claims and = leases=20 using existing permits while simultaneously preparing an = application for=20 production permits. The Company presently has three active Land = Use=20 Permits (LUP) and a Class B Water Licence which enable early stage = and=20 advanced exploration to be carried out on the Prairie Creek = property. A=20 fourth LUP application to re-open the winter road is in the late = stages of=20 permitting process. Extensive time and effort has been expended in = permitting processes, and in particular, rigorous Environmental=20 Assessments have been carried out on the three LUP=E2=80=99s and = the Water=20 License. A brief summary of each permit follows with a link to the = Mackenzie Valley Environmental Impact and Review Board = (=E2=80=9CMVEIRB=E2=80=9D) and/or the Mackenzie Valley = Land and=20 Water Board (=E2=80=9CMVLWB=E2=80=9D) Websites for a comprehensive = list of=20 documentation on the public registry relating to the particular = permits.=20

PERMITTING ACTIVITY (starting with most = recent)

Permitting = Update:=20 Applications to MVLWB: MV2008L2-0002, MV2008D0014=20 MV2008T0013, MV2008T0012 as of August 11, 2008 are = now=20 referred to Environmental Assessment under the Mackenzie Valley=20 Environmental Impact Review Board.

As reported in the = Company=E2=80=99s August 7, 2008=20 news release, applications to the Mackenzie Valley Land and Water = Board=20 (the =E2=80=9CMVLWB=E2=80=9D) for operating permits for the = Prairie Creek Mine were deemed=20 to be complete and the MVLWB initiated the preliminary screening = process=20 and requested comments from interested parties.

The MVLWB has now received = comments from a=20 number of parties, including Indian and Northern Affairs Canada = (=E2=80=9CINAC=E2=80=9D)=20 and various First Nations. Following a request from the Nahanni = Butte Dene=20 Band, as per Article 12 of the Settlement Agreement between the = Dehcho=20 First Nations and the Government of Canada, INAC referred the = proposed=20 development to environmental assessment.

In its referral INAC letter = stated that=20 =E2=80=9CINAC supports responsible economic development within = a sound=20 regulatory regime in the Northwest = Territories.=E2=80=9D In particular,=20 INAC cited specific changes or additions to existing = infrastructure=20 proposed by Canadian Zinc that need to be further assessed, such = as,=20 =E2=80=9Cthe changes to subsurface tailings disposal, use of = the original=20 surface tailings pond as a water management facility, waste rock=20 management plans, sewage treatment plant and power plant upgrade=20 plans.=E2=80=9D

The Company has received formal = notice from=20 the Mackenzie Valley Environmental Impact and Review Board (the = =E2=80=9CMVEIRB=E2=80=9D)=20 on August 11, 2008 of the referral of the applications to = Environmental=20 Assessment. The MVEIRB has created a public registry, = available on=20 line at www.mveirb.nt.ca/registry, = and=20 is now in the process of determining the scope and terms of = reference of=20 the assessment in consultation with interested parties.

Various aspects of the Prairie = Creek=20 project have previously been the subject of five separate = environmental=20 assessments by the MVEIRB, all of which recommended that the = proposed=20 projects should proceed. During these previous assessments a = considerable amount of information and data has been generated = which=20 should assist and expedite the current review process.

For a simplified overview of the=20 applications please refer to our new brochure entitled =E2=80=9C= REGULATORY=20 APPLICATIONS FOR PRAIRIE CREEK OPERATIONS=E2=80=9D.

Water Licence for Prairie Creek Mine Operation = (MV2008L2-0002), in=20 progress

Land Use Permit for Prairie Creek Mine Operation = (MV2008D0014), in=20 progress

Click here and = then=20 click on 2008 when in the Mackenzie Valley Website: Public = Registry=20 MV2008L2-0002 and MV2008D14

Status: MVLWB received June 2, 2008 presently reviewing.

THE PROPOSED PRAIRIE = CREEK MINE=20 OPERATION:

Mineral Resource = Basis.=20 The Prairie Creek Mine mineralization occurs as both Vein and = Stratabound=20 type deposits. Based on a recently completed detailed underground=20 exploration and development program an updated mineral resource = was=20 calculated in 2007 (in accordance with the requirements of = National=20 Instrument 43-101 Standards for Disclosure for Mineral Projects) = which=20 defines an overall Measured and Indicated Mineral Resource = totalling=20 5,158,164 tonnes grading 10.8% Pb, 11.3% Zn, 175 g/t Ag and 0.4% = Cu. =20 This is sufficient for more than 10 years of operations at the = planned=20 production rates. In addition, there is an open-ended inferred = resource of=20 5,541,576 tonnes grading 11.4% Pb, 13.5% Zn, 215 g/t Ag and 0.5% = Cu.=20 Mineral resources were reported in a 43-101 compliant=20 Technical Report dated October 12, 2007, prepared by MineFill = Services=20 Inc. (Dr. David Stone and Stephen Godden =E2=80=93 Qualified = Independent Persons).=20

Environment. = Extensive=20 environmental data has been collected at the Prairie Creek Mine = Site over=20 recent years to update and add to the baseline information that = was=20 collected previously as far back as the late 1970=E2=80=99s. = Sixteen years of=20 water flow data have been recorded on the Prairie Creek = watercourse=20 adjacent to the Mine Site. CZN now has an extensive database on = water=20 quality, stream flows, local climatic variables, and the wildlife = in the=20 area.

The Mine. All = mining will=20 be performed from underground. Underground development and = workings (about=20 5,000 metres) already exist on three levels, including the new 600 = metre=20 decline driven in 2006/07. Proposed production rates will = initially start=20 at 600 tonnes/day and will build to 1,200 tonnes/day. Mining = will=20 occur on a year round basis by cut-and-fill methods. Mine voids = will be=20 backfilled with a mix of filtered tailings, waste rock aggregate = and=20 cement. The current planned mine life is 14 years.

The Mill. The = Mill, which=20 is already constructed on site but never operated, will process = 600-1,200=20 tonnes/day. Ore will be crushed to a gravel-size and subjected to = dense=20 media separation (=E2=80=9CDMS=E2=80=9D). The lighter, uneconomic = =E2=80=9Cgangue=E2=80=9D minerals (about=20 30%) will create a waste rock aggregate. Denser material will be = processed=20 further by grinding and flotation to produce concentrates of lead=20 sulphide, zinc sulphide and lead oxide. No hazardous chemicals = will be=20 used in the process.

Concentrates and Road=20 Haul. The concentrates will be bagged, stored under cover = and=20 trucked off-site on flat-deck trailers over the winter road. CZN = holds a=20 Type =E2=80=9CA=E2=80=9D LUP (MV2003F0028) for the use of the = winter road from the Prairie=20 Creek Mine to the Liard Highway. The permit for the existing road = has been=20 determined to be exempt from environmental assessment (Canadian = Zinc=20 Corporation vs. MVLWB, NWT Supreme Court, 2004). CZN has also = applied for=20 Type =E2=80=9CA=E2=80=9D LUP=E2=80=99s for two new transfer = facilities to be located approximately=20 mid-point along the winter road and at the junction of the winter = road=20 with the Liard Highway.

Waste=20 Management. All flotation tailings will be backfilled = into the=20 voids in the underground mine in a mix with the waste rock = aggregate and=20 cement. The flotation tailings are expected to be non-acid = generating with=20 low sulphide content and excess buffering capacity. Waste rock = from=20 underground development along with excess waste rock aggregate = from the=20 DMS plant will be placed in an engineered Waste Rock Pile = (=E2=80=9CWRP=E2=80=9D) in the=20 adjacent Harrison Creek valley.

Water = Management. An=20 existing large pond, originally intended in 1980 for tailings = disposal,=20 will be reconfigured, relined and recertified to form a two-celled = Water=20 Storage Pond. Mine drainage, treated sewage water and WRP runoff = will=20 report to the first cell. Water for the mill process will be taken = from=20 this first cell. Excess water from the first cell will overflow = into the=20 second cell. Used water from the Mill will also report to the = second cell.=20 The second cell will feed a water treatment plant. The treated = water will=20 discharge to the existing certified Polishing Pond and from there = into the=20 existing Catchment Pond, before final discharge to the = environment.

Site = Infrastructure. The=20 Site presently contains a near complete mill, three levels of = underground=20 workings, a fuel tank farm, office facilities, accommodation = facilities=20 and workshops. Existing buildings and structures will be upgraded = and=20 modernized. New facilities will include fuel-efficient = low-emission power=20 generation units, a kitchen/accommodation block, concentrate shed = and an=20 incinerator.

Socio-Economics and=20 Manpower. The operation of the Prairie Creek Mine will = provide=20 substantial economic stimulus to the region, and presents a unique = opportunity to enhance the social and economic well-being of the=20 surrounding communities. There will be approximately 220 direct = full time=20 jobs, half of this number being on-site at any one time. Personnel = will=20 generally work a three weeks on, three weeks off schedule (with = variations=20 as required). CZN=E2=80=99s objective is to employ a workforce = with a 35% northern=20 content, and a minimum 15% First Nations content assisted by = training=20 programs. In addition, there will be many indirect business and = employment=20 opportunities, mostly related to transport and supply of the Mine = Site and=20 environmental monitoring and management.

Mine Closure. At = the end=20 of the Mine=E2=80=99s life, the Site will be reclaimed. The = underground=20 development will be backfilled. Bulkheads at strategic points will = help=20 limit the movement of groundwater. The objective is to create a = complete=20 seal to ensure there is no long term mine drainage. The WRP will = be=20 covered and sealed with a clay-rich soil. Site buildings and=20 infrastructure, if deemed not to have any future use, will be = dismantled=20 and the Site will be returned to its natural setting.

To=20 view the complete Project Description Report please click = here**

Click here and = then=20 click on 2008 when in the Mackenzie Valley Website: Public = Registry=20 MV2008L2-0002 MV2008D14

Land Use Permit for Tetcela Transfer Facility = (MV2008T0013),=20 in progress

Status: MVLWB received June 2, 2008 presently reviewing.

Operation of the Prairie Creek Mine will require transport of=20 significant volumes of concentrate from the mine to the = market. The=20 initial proposal for operations is based on a winter road scenario = and in=20 order to support the movement of concentrate out and supplies in = there is=20 a need to establish some transfer points along the route. The = Tetcela=20 Transfer Facility (=E2=80=9CTTF=E2=80=9D) is proposed to be = established at kilometre 84 of=20 the winter road to expedite the shipment of concentrate across the = Liard=20 River Ice bridge.

To = view the complete Project Description Report please click = here**

Click here and = then=20 click on 2008 when in the Mackenzie Valley Website: Public = Registry=20 MV2008T0013

Land Use Permit for Liard Transfer Facility = (MV2008T0012), in=20 progress

Status: MVLWB received June 2, 2008 presently reviewing.

Operation of the Prairie Creek Mine will require transport of=20 significant volumes of concentrate from the mine to the = market. The=20 initial proposal for operations is based on a winter road scenario = and in=20 order to support the movement of concentrate out and supplies in = there is=20 a need to establish some transfer points along the route. = The Liard=20 Transfer Facility (=E2=80=9CLTF=E2=80=9D) is proposed to be = established at the junction of=20 the winter road and existing Liard Highway. This facility = will=20 expedite the transfer and transport of inbound and outbound = material in=20 relation to operations at the Prairie Creek Mine.

To = view the complete Project Description Report please click = here**

Click here and = then=20 click on 2008 when in the Mackenzie Vallet Website: Public = Registry=20 MV2008T0012

Winter Road Rehabilitation: CLASS "B" WATER LICENCE=20 (MV2007L8-0026)

The Winter Road Land Use Permit application process took place = over a=20 substantial time period from application, on September 2003, to = issue of=20 permit, April 2007. Subsequent to receiving LUPMV2003F0028 a = preliminary=20 technical assessment of the road conditions took place which = determined=20 that during the course of over 3 years of time that passed while = in the=20 regulatory process there had occurred a number of flood events = which had=20 caused significant washouts to occur over the Prairie Creek/Sundog = sections of the road. This particular section of road was = previously=20 permitted as an all season road. It was determined that in these=20 particular sections it would be advantageous to properly rebuild = the road=20 with suitable rock armour during the summer/fall season to protect = it from=20 future washouts. This would also substantially reduce the work = that would=20 be required during the winter season to re-establish the road base = in=20 these sections of road. Since significant amounts of material = would be=20 required to be moved within the creek beds a Class B Water Licence = was=20 applied for with the MVLWB.

An application was submitted June = 7th 2007=20 to the MVLWB and a Water Licence was issued March 20, 2008. In = addition to=20 this Water Licence an application seeking authorization from the=20 Department of Fisheries and Oceans Canada (DFO) was required. This = DFO=20 application for authorization was submitted also in early June = 2007 and an=20 authorization to proceed with the rehabilitation work was issued = from DFO=20 July 15, 2008. Work has now commenced on the rehabilitation = of the=20 winter road.=20

Click here and = then=20 click on 2008 when in the Mackenzie Valley Website: Public=20 Registry MVLWB MV2007L8-0026

Winter Road Land Use Permit (MV2003F0028)

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Permit application MV2003F0028 was submitted to the MVLWB on = September=20 25 2003, to reopen the winter access road from the Liard Highway = to the=20 Prairie Creek mine in order to replenish supplies to sustain = multi-year=20 exploration. The road was previously permitted prior to 1984 when = the=20 Mackenzie Valley Resource Management Act (MVRMA) was enacted. = Therefore,=20 the Company considered the permit application to be exempt from = screening=20 for EA, or =E2=80=98grand-fathered=E2=80=99, according to Part 5 = of the Act. However, the=20 MVLWB took a contrary view, and referred the application to EA. = The=20 Company contested the referral, and a Judicial Review took place = on=20 December 9, 2004 in the Supreme Court of the Northwest = Territories. A=20 decision in favour of the Company was handed down May 6, 2005 and = the=20 MVLWB were instructed to proceed with the permit process. For = details of=20 the court decision please click here.

The MVLWB subsequently received letters from the Nahanni Butte = Dene=20 Band who contend that the issue of a permit for the road would be = a=20 serious infringement of their aboriginal and treaty rights, = protected by=20 Section 35 of the Constitution Act, 1982, and that the Crown had = not=20 consulted them on the matter. The MVLWB decided to suspend the = permit=20 process until the Department of Indian and Northern Affairs (INAC) = has=20 informed them that appropriate consultation has taken place = between the=20 Crown and the Band. The MVLWB received a consultation report from = INAC on=20 February 15, 2007. The MVLWB then circulated the application = in=20 order to receive further comments on conditions of a Winter Road = LUP and=20 subsequently issued the Land Use Permit April 11, 2007 with an = expiry date=20 of April 10, 2012.
Public Registry MVLWB MV2003f0028

Phase III Drilling Permit (MV2004C0030)

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The Company applied for an amendment to LUP MV2001C0022 (Phase = II=20 Drilling) in order to drill holes more than 1000 m from the Mill,=20 including the crossing of Prairie Creek. The amendment was denied, = and the=20 application was referred to EA on June 1, 2004 (MVEIRB file = 0405-02).=20 After a lengthy review process, the MVEIRB recommended the project = proceed=20 with conditions, and the MVLWB issued a Land Use Permit on May 11, = 2006.The Company completed four shallow diamond drill holes in = 2006 and=20 confirmed the continuity of the mineralized vein below surface = trenches=20 approximately 2 km west of the camp.
Public Registry MVEIRB
Public Registry MVLWB MV2004C0030

Pilot Plant Operation and Underground Decline Water License = (Class=20 =E2=80=98B=E2=80=99) (MV2001L2-0003)

=20

The application for a Pilot Plant operation was subject to = joint=20 Environmental Assessment (EA) with the Decline application. A = Water=20 License was issued on September 10, 2003. On October 10, 2003 the = Company=20 and the MVLWB received notice of an application in Federal Court = for a=20 Judicial Review of the Water License by applicants, Nahanni Butte = Dene=20 Band, Pehdze Keh and DehCho First Nations. The Applicants felt = that the=20 terms and conditions of the draft license were not properly = incorporated=20 into the issued License. The Attorney General joined the = applicants=20 because of a precedent issue. The Judicial Review occurred on = August 30,=20 2005. The Company and the Attorney General agreed on a revised = wording,=20 and recommended this to the court. A decision was handed down = December 23=20 in which the Judge instructed the MVLWB to re-issue the License = with the=20 recommended wording. For details of the court decision please = click here.=20 A revised Water License was issued on February 6, 2006.
Public Registry MVEIRB
Public Registry MVLWB MV2001L2-0003

Underground Decline, Exploration Drilling and Pilot Plant Land = Use=20 Permit (MV2001C0023)

=20

After a rigorous Environmental Assessment, the MVEIRB issued = its Report=20 of Environmental Assessment on January 22, 2002 recommending = approval of=20 the proposed development subject to various terms and conditions = to=20 mitigate against potential impacts to the environment. The Report = was=20 forwarded to the Minister of Indian and Northern Affairs on = February 6,=20 2002 for approval as required under the Mackenzie Valley Resource=20 Management Act. Land Use Permit MV2001C0023 was received on = September 10,=20 2003. The permit provides for the development of a new 600 m long = Decline=20 from the existing 870 m level adit with at least 9 = =E2=80=98stations=E2=80=99 to allow the=20 drilling of 50 to 250 m long holes. By the end of 2006, the = Decline had=20 been driven 400 m, 6 stations were established, and 6 diamond = drill holes=20 were completed. The permit also provides for operation of a Pilot = Plant,=20 although the Company has chosen not to proceed with this at = present,=20 choosing instead to conduct metallurgical testing off-site.

As part of Decline development, the Company implemented = collection and=20 treatment of mine water. As water from the Decline is pumped to = the 870 m=20 level adit, which itself produces water, water from both sources = was=20 treated. This is the first time that legacy metal-bearing (mainly = zinc)=20 water from the 870 m level is being treated. The Company was = successful in=20 removing approximately 95% of the total zinc contained in the = combined=20 flow.
Public Registry MVEIRB
Public Registry MVLWB MV2001C0023

Phase II Drilling Land Use Permit (MV2001C0022)

=20

The Land Use Permit application submitted March 5, 2001 was = approved=20 and Land Use Permit MV2001C0022A was issued November 30, 2001 = authorizing=20 the drilling of up to 50 to 60 diamond drill exploration holes = within 1000=20 m of the mine site. In 2004, 27 diamond drill holes were = completed,=20 exploring the periphery of the known resource. The Permit was = valid for a=20 period of 5 years, and was extended for a further two years.When = this Land=20 Use Permit was issued, pre-existing Land Use Permit MV2000C0030A = (issued=20 on June 14, 2001 and authorizing the drilling of up to 7 diamond = drill=20 exploration holes) became redundant (for further information on=20 MV2000C0030A click here ), and was thus not extended in = 2006.
Public Registry MVEIRB
Public = Registry=20 MVLWB

Contact = us=20 to learn more >>>

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