Mr. Clynt Nauman reports

ALEXCO REPORTS FIRST QUARTER 2017 RESULTS

Alexco Resource Corp. has released its financial results for the first quarter ended March 31, 2017. For the first quarter of 2017 Alexco recorded a net loss of $932,000 or one cent per share, including $1.1-million in share-based compensation expense and $500,000 in depreciation. Alexco Environmental Group (AEG), a wholly owned subsidiary of Alexco, recognized revenues of $1.9-million with a gross profit of $500,000, achieving a gross margin of 28 per cent.

First quarter highlights:

• The company had an unrestricted cash and cash equivalent position on March 31, 2017, of $20.8-million and net working capital of $23.5-million compared with $20.4-million and $23.4-million, respectively, at Dec. 31, 2016.
• Alexco announced an updated mineral resource estimate for the Bermingham deposit, expanding the indicated mineral resources from 5.2 million ounces to 17.3 million ounces while inferred mineral resources increased from approximately 700,000 ounces to 5.5 million ounces of contained silver.
• Alexco announced the release of an independent technical report dated March 29, 2017, with an effective date of Jan. 3, 2017, entitled "Preliminary economic assessment of the Keno Hill silver district project, Yukon, Canada," and announced an amended silver purchase agreement with Silver Wheaton Corp.
• Sold investments in marketable securities for proceeds of $2-million and a pretax realized gain of $1.2-million.
• AEG recognized revenues of $1.9-million for a gross profit of $500,000 and a gross margin of 28.4 per cent.
• Alexco entered into a non-binding letter agreement with Banyan Gold Corp. to option up to 100 per cent of Alexco's McQuesten property located in the KHSD.

Alexco's executive chairman and chief executive officer, Clynt Nauman, said: "With the publication of the updated PEA incorporating the amended SPA, Alexco is launching into the balance of 2017 squarely focused on moving forward with underground access to the high-grade Bermingham deposit in anticipation of extensive underground exploration drilling, as well as getting started on a plus-12,000-metre surface exploration program in areas proximal to the Bermingham discovery. Equipment rebuilds, mill, camp and infrastructure upgrades will also be completed alongside a prefeasibility level study, as we move Keno Hill back toward a final production decision."

                         SUMMARY FINANCIAL RESULTS AND INFORMATION
                  (expressed in thousands of dollars, except per-share amounts)
  
                                                                 Three months ended March 31,
                                                                            2017         2016
                                                                                             
Revenue from environmental services                                       $1,935       $2,348
Gross profit from environmental services                                     549          565
(Loss) before taxes                                                       (1,061)      (2,018)
Net (loss)                                                                  (932)      (2,110)
Total comprehensive (loss)                                                  (852)      (1,903)
(Loss) per share -- basic and diluted                                     ($0.01)      ($0.03)
Cash flows (loss) consumed from operating activities                      (1,215)      (1,083)
                                                                                              

Keno Hill silver district PEA

On March 29, 2017, Alexco announced the release of an independent technical report with an effective date of Jan. 3, 2017, prepared by Roscoe Postle Associates Inc. (RPA) entitled "Preliminary economic assessment of the Keno Hill silver district project, Yukon, Canada."

Highlights of the revised PEA include:

• Average annualized mill throughput is 143,000 tonnes per year (400 tonnes per day) over an eight-year period at an average mill feed grade of 843 grams per tonne (g/t) silver, 3.3 per cent lead, 4.6 per cent zinc and 0.39 g/t gold. Average mill feed grades in production years 1 to 3 are anticipated to be approximately 930 g/t silver with payable silver production averaging 4.1 million ounces per year.
• Life-of-mine payable production is anticipated to be a total of approximately 25.1 million ounces of silver, 77.3 million pounds of zinc, 67 million pounds of lead and 4,870 ounces of gold over an eight-year period. Average annualized payable silver production is 3.5 million ounces per year, with the initial three years of annualized payable silver production averaging 4.1 million ounces per year.
• Alexco's project pretax and aftertax net present value (NPV) is $104.3-million and $79.4-million (at a 5-per-cent discount rate), respectively, and pretax and aftertax internal rate of return (IRR) is 89 per cent and 75 per cent, respectively, at assumed silver prices of $18.60 (U.S.) per ounce in 2018 and $19.35 (U.S.) per ounce in 2019 through 2025.
• Initial capital costs of $27-million are estimated to achieve production and positive cash flow with less than one-year payback.

Upon achieving commercial production, Alexco anticipates all-in sustaining costs (AISC) (contained silver, byproduct basis) over LOM (life of mine) to be $13.51 (U.S.) per ounce of silver (including direct operating costs, sustaining capital, the Silver Wheaton stream, corporate general and administrative, and continuing surface exploration costs), and AISC over the first full three years of production to be $12.18 (U.S.) per ounce of silver.

Amended silver purchase agreement with Silver Wheaton

On March 29, 2017, Alexco and certain of its subsidiaries and Silver Wheaton executed the amended SPA pursuant to which, among other things, the following amendments were made to the silver streaming agreement:

• Silver Wheaton will continue to receive 25 per cent of the life-of-mine payable silver from the KHSD. The production payment (originally $3.90 (U.S.) per ounce) will be based on monthly silver head grade and monthly silver price.
• The actual monthly production payment will fall within a defined grade and pricing range governed by upper and lower numeric criteria comprising a ceiling grade and price of 1,400 grams per tonne silver and $25 (U.S.) per ounce silver, respectively, and a floor grade and price of 600 g/t silver and $13 (U.S.) per ounce silver.
• The date for completion of the 400-tonne-per-day mine and mill completion test date was extended to Dec. 31, 2019.
• The Silver Wheaton area of interest remains one kilometre around existing Alexco holdings in the KHSD.

In consideration of the foregoing amendments, and as recorded in the second quarter of 2017, Alexco issued to Silver Wheaton three million shares with a fair value of $4.9-million (U.S.) which is a reduction in the original $50-million deposit.

Keno Hill exploration and development

Alexco has planned a surface exploration program of approximately 12,000 m of surface diamond drilling budgeted to cost $3.2-million. This program will further explore potentially mineralized structural targets in the immediate vicinity of the Bermingham deposit. The bulk of the surface exploration will be conducted in the summer with results expected to be released no later than the fourth quarter of 2017.

Alexco is also planning an underground exploration program at the Bermingham prospect. Subject to permitting, an exploration decline will be driven 600 m with approximately 5,000 m of infill and confirmation drilling for a total estimated cost of $8.7-million, including underground equipment rebuilds and purchase.

Permitting

To drive a 600 m underground exploration decline at the Bermingham deposit followed by approximately 5,000 m of underground exploration definition drilling, will require an amendment to Alexco's Class IV mining land use authorization. Alexco is well advanced in this process and expects the amendment no later than the third quarter of 2017. Upon completion of this amendment of the Class IV permit, a further amendment to Alexco's quartz mining licence (QML) and water use licence (WUL) will be required for future production and processing of ore from Bermingham. The environmental assessment for the mine operations phase of permitting is expected to begin concurrent with the delivery of the initial amendment and be complete in the last half of 2018.

The Flame and Moth deposit is permitted to be developed under the QML. Prior to processing ore or discharging water from the Flame and Moth mine, an amendment to the WUL is required, which is granted through the Yukon Water Board. A public hearing for the WUL amendment is currently scheduled for late May, 2017, and an amended WUL is expected to be granted in the third quarter of 2017. The guidance above on permitting is consistent with the schedules and timing disclosed in the KHSD PEA, which targets production to commence in the fourth quarter of 2018.

Financial

Alexco's cash and cash equivalents at March 31, 2017, totalled $20.8-million compared with $20.4-million at Dec. 31, 2016, while net working capital totalled $23.5-million compared with $23.4-million for the same dates. With its cash resources and net working capital on hand at March 31, 2017, Alexco anticipates it will have sufficient capital resources to carry out all of its currently anticipated exploration programs and service the working capital requirements of its exploration activity, environmental services business and corporate offices, and administration as planned for 2017 and into 2018.

Alexco Environmental Group

AEG recorded revenues of $1.9-million and a gross profit of $500,000 for a gross margin of 28 per cent, compared with revenue of $2.4-million and a gross profit of $600,000 for a gross margin of 24 per cent in the first quarter of 2016. The reduction in revenue and gross profit is primarily related to the anticipated near-term completion of the Keno Hill reclamation plan and permitting submission, as well as completion of plant construction project work in the United States along with transition to plant operating activities.

AEG is successfully operating two major water treatment facilities in the U.S., the Gold King and Schwartzwalder plants, as well as four smaller water treatment facilities at Keno Hill in Canada.

Financial report and conference call for first quarter 2017

Full details of the financial and operating results for the first quarter ended March 31, 2017, are described in Alexco's interim condensed consolidated financial statements with accompanying notes and related management's discussion and analysis. These documents and additional information on Alexco, including its annual information form, are available on Alexco's website and on SEDAR and on EDGAR.

Alexco is holding an audio webcast conference call to discuss these results at 11 a.m. Eastern Time (8 a.m. Pacific Time) on Thursday, May 11, 2017. To participate in the live call, please use one of the following methods:

Dial toll-free from Canada or the U.S.:  1-888-504-7961

Dial from outside Canada or the U.S.:  1-647-792-1278

Conference ID No.:  7717619

Participants should connect five to 10 minutes before the call. The conference call will be recorded and an archived audio webcast will be available at the company's website.

Qualified persons

The disclosure in this news release of scientific and technical information regarding exploration projects on Alexco's mineral properties has been reviewed and approved by Alan McOnie, FAusIMM, vice-president, exploration, while that regarding mine development and operations has been reviewed and approved by Scott Smith, PEng, former Bellekeno mine manager, both of whom are qualified persons as defined by National Instrument 43-101 -- standards of disclosure for mineral projects.

About Alexco Resource Corp.

Alexco Resource holds the historical high-grade Keno Hill silver district located in Canada's Yukon. Employing a unique business model, Alexco also provides mine-related environmental services, remediation technologies and reclamation and mine closure services to both government and industry clients through the Alexco Environmental Group, its wholly owned environmental services division.

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