ICE The wholly owned Ice deposit is located 80 kilometres northwest of the Wolverine deposit. An inferred resource of 4,561,863 tonnes grading 1.48% copper has been estimated. Much of the resource is near surface and may be amenable to open pit mining. Drill of 8.56% copper over 5.9 metres and 5.2% copper over 20.5 metres define a small high grade core of mineralization that could be mined from a shallow decline and provide high-grade copper ore for blending with Wolverine ores. WOLVERINE RESOURCES AND RESERVES 20<strong>05</strong> <strong>Yukon</strong> <strong>Zinc</strong> completed 59 surface drill holes to better define the resources in the Wolverine deposit and integrated this data with the historical drill hole results to produce a new Resource Tonnes Zn Ag Cu Au Pb Category (%) (g/t) (%) (g/t) (%) Measured 509,000 12.17 292.3 1.15 1.47 1.46 materials. Mill feed to the mill is projected at 4,462,000 tonnes grading 11.25% zinc, 1.07% copper, 1.48% lead, 1.56 g/t gold and 327 g/t silver. This feed provides approximately 10 years of production. Conversion of the Inferred resources into mining reserve would add an additional 3.5 years to the production plan. TEST MINING AND FEASIBILITY STUDY In January 20<strong>05</strong>, <strong>Yukon</strong> <strong>Zinc</strong> began mobilizing equipment and materials into Wolverine for the undertaking of a CAD$19 million advanced exploration program that consisted of detailed definition drilling of the resources, engineering and environmental studies, and test mining to support the completion of a bankable feasibility and project permitting. An important part of the test mining was confirming mining conditions as they relate to mining costs and ore recovery. A decline was made to the upper part of the Lynx deposit and then drifting and cross-cutting on the ore to provide bulk sample material and geotechnical information. This work confirmed that Indicated 4,002,000 12.03 359.4 1.16 1.71 1.58 Total 4,511,000 12.04 351.5 1.15 1.68 1.57 Inferred 1,694,000 12.16 385.1 1.23 1.71 1.74 National Instrument 43-101 compliant resource estimate. The Measured and Indicated resources total approximately 4.5 million tonnes which are the basis of the mining reserve. There is also 1,694,000 tonnes of Inferred resources that need additional in-fill drilling to improve their confidence level. The Inferred resources are largely within the deeper portion of the deposit, and are open across the claim boundary onto the WOL claims owned by TeckCominco. The resources are not particularly sensitive to cutoff grade and the new mining reserves include almost all of the Measured and Indicated resources. Mining of the Measured and Indicated resources is estimated to include approximately 18% of external dilution. It is planned to crush this run-of-mine material to minus one inch and process it through a dense media separation (DMS) plant to remove less dense waste rock conditions were better than expected; particularly in the periphery of the massive sulphide mineralization. In June 20<strong>05</strong>, <strong>Yukon</strong> <strong>Zinc</strong> commissioned Hatch Ltd. to undertake a bankable feasibility study. As at March 31, 2006, the detailed feasibility study was near completion and PAGE 8 YUKON ZINC 20<strong>05</strong> ANNUAL REPORT
The first sulphide rock through the portal entrance comes 10 years plus a week from the discovery date of the deposit. YUKON ZINC 20<strong>05</strong> ANNUAL REPORT PAGE 9
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