Mr. John Kearney reports

CANADIAN ZINC REPORTS RESULTS FOR THIRD QUARTER 2015

Canadian Zinc Corp. has released its results for the three- and nine-month periods ended Sept. 30, 2015.

Financial results

During the first nine months of 2015, Canadian Zinc invested $7.0-million on exploration and development programs at its Prairie Creek project, which investment was expensed in accordance with the company's accounting policy.

For the three- and nine-month periods ended Sept. 30, 2015, the company reported a net loss of $1,778,000 and $8,213,000, respectively, compared with a net loss of $3,659,000 and $8,757,000 for the same periods ended Sept. 30, 2014.

At Sept. 30, 2015, the company had cash and cash equivalents of $2,327,000, short-term investments of $23,000, and marketable securities of $300,000 and a positive working capital balance of $2,655,000. The company also had restricted cash of $2,075,000, which increased from $525,000 at Dec. 31, 2014, as security of $1.55-million was posted with the government of the Northwest Territories as financial assurance in respect of existing reclamation obligations following approval by the Mackenzie Valley Land and Water Board in August, 2015.

Prairie Creek project

The company's activities on the Prairie Creek project over the third quarter and first nine months of 2015 have been working to improve the project economics by increasing the mine life; defining the capital cost required to place the mine into production; refining the projected mine operating costs; and developing a transportation plan and marketing strategy for the Prairie Creek concentrate production. Notable progress has been made on all of these items over the past year.

New mineral resource highlights

A new mineral resource estimate completed by AMC Mining Consultants in September, 2015, has demonstrated an increase in overall resource tonnages in the indicated and the inferred categories. The new September, 2015, mineral resources estimate, with increases in both the vein and stockwork tonnages in the indicated categories, will increase the life-of-mine potential, compared with the 2012 resource estimate included in the preliminary feasibility study (PFS) completed by SNC-Lavalin in 2012.

Total measured and indicated resource tonnages increased by 32 per cent to 8.7 million tonnes at a combined grade of approximately 19 per cent lead (Pb) and zinc (Zn) plus 136 grams per tonne (g/t) silver (Ag). Total inferred resource tonnages remained relatively unchanged with an increase in stockwork replacing upgraded main quartz vein resource.

        PRAIRIE CREEK RESOURCE ESTIMATE: SEPTEMBER, 2015
         
                                 Tonnes    Zn %    Pb %   Ag g/t
Main quartz vein (MQV)
Measured                      1,313,000    13.2    11.5      211
Indicated                     4,227,000     9.2    11.6      168
Total MQV measured and
indicated                     5,540,000   10.16   11.56      178
Total MQV inferred            5,269,000    12.9     8.7      199


Stockwork (STK)                  Tonnes    Zn %    Pb %   Ag g/t

Measured                        169,000    12.6     5.3      116
Indicated                     1,953,000     6.6     3.5       61
Total STK measured
and indicated                 2,122,000    7.12    3.64       66
Total STK inferred            1,610,000     6.2     4.6       70


Stratabound (SMS)                Tonnes    Zn %    Pb %   Ag g/t

Measured                              0     0.0     0.0        0
Indicated                     1,042,000    10.8     5.2       54
Total SMS measured
and indicated                 1,042,000    10.8     5.2       54
Total SMS inferred              170,000    11.2     6.3       60

Underground exploration program

Canadian Zinc completed its 2015 underground exploration diamond drill program at the Prairie Creek mine at the end of June. The exploration program was carried out from three 50-metre-spaced underground drill stations on the decline from the end of the existing 870-metre development level and totalled 5,484 metres of diamond drill coring in 21 drill holes.

The results of the 2015 underground exploration drilling program have been very positive, with all holes intercepting the MQV structure and/or stockwork mineralization, with some excellent grades and widths. The objectives of testing for new areas of mineralization in proximity to the existing underground workings and increasing the projected life of the mine by converting part of the currently inferred resource to an indicated category have been met.

Some of the highlights of the 2015 diamond drilling program include: a previously unknown quartz vein fault structure was discovered in the footwall of the MQV. This second vein system has been intersected in five holes and appears to be defining a structural transition zone which offsets the general strike trend of the upper part of the MQV.

Numerous holes intersected extensions to the previously known STK zone, which occurs mostly outside, but adjacent to, the calculated indicated resource. These intersections will add to the STK resource. The STK intercepted and sampled during this drill program has also indicated areas within this resource of significant grades and widths that could be targeted for early selective mining.

Detailed underground chip sampling of the northwest drift in the 870 m level workings returned composite grades of 5.6 per cent Pb, 14.2 per cent Zn and 119 g/t Ag across a true width of 4.4 m along the strike length of 71.8 m, further demonstrating the potential for early, selective mining of the STK mineralization.

Mineralization remains open to the north into the already defined inferred resource.

Results from the underground exploration program were reported in the company's press releases dated May 5, 2015; June 9, 2015; June 23, 2015; and Aug. 11, 2015.

Transportation studies -- evaluation of possible all-season road

The transportation plan utilized in the 2012 PFS envisaged the use of the access road from the mine site to the Liard Highway only in the winter months of each year, both for the outbound transportation of concentrates and for the inbound transportation of equipment and supplies, including diesel fuel.

Over the past year, Canadian Zinc has been working to identify optimum transportation routes and methods, along with the associated costs, in pursuit of possible improved economics. Consideration is now being given to the construction and use of an all-season road which would enable the transportation of both supplies and concentrates in smaller volumes spread throughout the year.

In 2014, the company submitted an application to the Mackenzie Valley Land and Water Board and to Parks Canada for land use permits to permit the possible future upgrade of the current winter access road to all-season use. The application is now undergoing environmental assessment before the Mackenzie Valley Review Board (MVRB). In April, 2015, Canadian Zinc submitted its developer's assessment report (DAR) to the MVRB. The MVRB completed a preliminary review of the DAR in response to which the company provided supplementary information to the MVRB partly in a DAR addendum, which was filed in September, 2015, to be followed by additional terrain analysis data to be submitted in November, 2015.

Use of an all-season road to Prairie Creek would have significant financial savings in working capital and in energy and financing costs, but at some additional capital costs, and would enable the consideration of more environmentally friendly alternative energy sources. There would be much less traffic in winter, and therefore a lower risk of any accidents or spills. The road could also provide the potential to promote tourism in the area and thus create long-term benefits for the region.

Prairie Creek permitting update

In June, 2015, the Mackenzie Valley Land and Water Board approved the company's application that the Type A water licence be held in abeyance until more certainty develops around the actual commencement of construction and the mine development schedule and also approved the company's applications for amendments to the timing schedules of the various reclamation security deposits to be provided under the water licence and the land use permit. Following this approval, security deposits totalling $1.55-million were deposited with the government of the Northwest Territories in August of 2015 to increase the financial assurance relating to current reclamation and closure obligations of the Prairie Creek mine site as it now exists with its current infrastructure under the company's existing surface leases, land use permits and Type B water licence.

Canadian Zinc and Parks Canada have signed a memorandum of understanding phase III (MOU) regarding the operation and development of the Prairie Creek mine and the management of Nahanni National Park Reserve. The phase III MOU, which is valid for five years from November, 2015, renews the previous MOUs signed between the parties in 2008 and 2012. In the renewed MOU, Parks Canada and Canadian Zinc agree to work collaboratively, within their respective areas of responsibility, authority and jurisdiction, to achieve their respective goals of managing Nahanni National Park Reserve and an operating the Prairie Creek mine. The parties agree to make every reasonable effort to address issues of common interest and build a strong working relationship, including convening a technical team, which will, among other things, better identify, define and consider issues of common interest including, among other things, development and use of the access to and from the Prairie Creek mine through Nahanni National Park Reserve and operation of the Prairie Creek mine.

Newfoundland properties

Canadian Zinc owns an extensive land package in central Newfoundland that includes three major volcanogenic massive sulphide (VMS) projects, each with defined deposits, which are being explored by Canadian Zinc.

The company's exploration strategy in Newfoundland is to continue to build on its existing polymetallic resource base with the aim of developing either a stand-alone mine, similar to the past-producing mine at Buchans or the Duck Pond mine, or a number of smaller deposits that could be developed simultaneously and processed in a central milling facility.

During the third quarter, Canadian Zinc continued its review and compilation of all recent and historical data which will assist in further defining drill targets and prioritize the numerous VMS prospects for future exploration.

Outlook

Canadian Zinc's 2015 underground exploration drilling program at Prairie Creek has been completed. The objective of increasing the life of the mine by the discovery of new areas of mineralization in proximity to the mine workings and by converting part of the currently inferred resource to an indicated category has been achieved.

The very encouraging results of the underground drill program have been incorporated into the updated September, 2015, mineral resource estimate. An updated mineral reserve is now being completed around which a revised mine plan is being designed.

The new mineral reserve estimate, revised mine plan, modified process flow sheet, expected treatment charges and penalties, and updated estimate of capital costs will enable production of a new and updated economic model for the Prairie Creek mine. This will form the basis of an updated preliminary feasibility study, which will also include an evaluation of the integration of an all-season road into the Prairie Creek project.

It was planned that this updated preliminary feasibility study, intended to support the financing required to complete the development and construction of the project and place the Prairie Creek mine into production, would be completed later this year. However, the considerable increase in mineral resources following the successful underground exploration program has necessitated a major revision to the mine plan and this work is still continuing. In addition, the work to finalize the design and cost estimates of the potential all-season access road has not yet been completed pending generation of the terrain analysis data requested by the MVRB which are to be submitted by the end of November, 2015.

Metal prices play a very significant part in the financing and development of the Prairie Creek project and Canadian Zinc watches commodity prices, especially lead and zinc, very closely to see where and when stability and a discernable outlook might emerge. Obviously, it is desirable that the updated prefeasibility study be completed incorporating as comprehensive and up-to-date information as possible, Canadian Zinc therefore plans to complete the updated prefeasibility study when all the information is available and the timing is considered appropriate.

At Sept. 30, 2015, Canadian Zinc had working capital of $2.70-million and expects it will be able to meet its current commitments and continue its planned 2015 programs. The company has sufficient cash and short-term investments to continue as a going concern for the ensuing 12 months. Additional financing will be required to continue the development of the Prairie Creek project. The ability to raise any financing is impacted by conditions beyond the control of the company, including prevailing commodity prices, continued uncertainty in the capital markets and the current lack of investor interest in the resource sector.

Careful management and preservation of cash are top priorities. Site programs have been reduced to a minimum. Cost reduction measures have been implemented across the company, including reductions in staff, corporate salaries and expenses, and director fees.

During the third quarter of 2015, zinc prices fell 18 per cent from a high of 92 U.S. cents per pound to approximately 75 U.S. cents per pound by the end of the quarter while LME and SHFE zinc warehouse stock levels rose 17 per cent from 686,000 tonnes to approximately 803,000 tonnes. Lead prices followed a similar, but less dramatic, pattern falling from 84 U.S. cents per pound to 76 U.S. cents per pound in the third quarter, while LME lead warehouse stock levels fell from 220,000 tonnes to 165,000 tonnes.

Notwithstanding the current weakness and volatility in most commodity prices, the long-term outlook for the prices of both zinc and lead remains very favourable. The closures of the Century mine in Australia and the Lisheen mine in Ireland are imminent. With the recent announcements of production cutbacks by Glencore, and potentially by Nyrstar and Volcan, the zinc concentrate market appears to be tightening leading to lower treatment charges. The decline in the Canadian/U.S. dollar exchange rate improves metal prices expressed in Canadian dollars and both of these economic factors impact favourably on Prairie Creek.

We seek Safe Harbor.