Bellekeno drill results encourage Alexco Resource Corp.

Underground drilling at Alexco Resource Corp.’s (AXR-T, AXU-X) Bellekeno mine in the Yukon’s Keno Hill silver district is yielding more high-grade silver intercepts.

Initial definition diamond drilling in the 99 zone, the middle of three zones that comprise the Bellekeno resource, has confirmed high-grade silver mineralization previously shown from historical underground chip sampling.

It is the first time Alexco has drilled the 99 zone and so far the results are encouraging. Highlights from 37 underground drill holes (totaling 1,795 meters) in the upper 99 zone include Hole 67, which cut 1,694 grams per tonne silver, 0.44 gram gold per tonne, 8.14% lead and 8.26% zinc over 7.83 meters.

“It’s a lead-silver rich zone similar to the southwest zone and was the only area that was originally mined,” says Clynton R. Nauman, president and chief executive officer. “They removed about 42,000 tonnes from this zone before everything was shut down in the 1980s…These holes just confirm their original work. Half the drilling is done and it seems to be moving along per our expectation.”

Alexco’s 2009 Bellekeno drill program got underway in February and focused on the upper portion of the East zone. Bellekeno’s Southwest and 99 zones make up a lead-dominated high grade silver deposit, while the East zone is a zinc-dominated silver system.

The primary goal of the drill program is to update the January 2008 National Instrument 43-101 compliant inferred resource estimate for Bellekeno (537,000 tonnes grading 1,016 grams per tonne silver, 0.4 gram gold per tonne, 13.5% lead and 10.7% zinc) and to collect geotechnical data prior to a construction decision scheduled for later this year.

Other highlights from zone 99 include hole 71, which returned 1,863 grams per tonne silver, 0.53 gram per tonne gold, 8.8% lead and 6.51% zinc over 6.01 meters, and hole 85, which cut 2,303 grams per tonne silver, 0.39 gram per tonne gold, 34.95% lead and 10.44% zinc over 2.29meters.

A 3.11-metre interval in hole 89 returned 1,898 grams per tonne silver, 0.26 gram per tonne gold, 25.54% lead and 2.22% zinc, while hole 90 cut 2,448 grams per tonne silver, 1.18 grams per tonne gold, 11.31% lead and 1.67% zinc over 2.05 meters.

About 40% of the planned holes in the 99 zone have been completed. The remainder will be drilled from the lower levels of the historical workings in June. In the meantime, two drills are at work in the adjacent southwest zone.

So far 75 drill holes have been completed in the Bellekeno underground program, and roughly 40 more holes are still to be

drilled to complete the planned 10,000 metres of underground infill and exploration diamond drilling.

The Keno Hill district is the second-largest historical silver producer in Canada. Between 1921 and 1988, the Keno Hill silver district produced more than 217 million ounces of silver with average grades of 40.5 oz. per ton silver, 5.6% lead and 3.1% zinc, according to the Yukon Government’s Minfile database.

Silver Wheaton (SLW-T, SLW-N) is to spend US$35 million on construction and development of the Bellekeno mine.

Under a purchase agreement, Silver Wheaton will buy 25% of future silver production at a cost of US$3.90 per oz. silver delivered, plus up-front deposit payments to Alexco totaling US$50 million.

Alexco received the initial US$15 million deposit payment in December 2008 and the remaining US$35 million will be received on a monthly draw-down basis commencing once a positive construction decision has been made.

At presstime in Toronto, Alexco was trading at $1.88 per share. Its 52-week trading range is 52¢-$4.04 per share and the company has about 43.1 million shares outstanding.