Lisa May - Director, Investor Relations Clynt Nauman - Chairman and Chief Executive Officer Brad Thrall - President Mike Clark - Chief Financial Officer

Mike Kozak - Cantor Fitzgerald Mike Niehueser - Scarsdale Equities

Good morning. Today is Friday, November 3, 2017 and I would like to welcome you to Alexco Resource Corp’s September 30, 2017 third quarter conference call.

This conference call is being webcast live and can be accessed at the company’s website at alexcoresource.com. You may sign up on the Alexco website to receive future news releases and other event updates as they are issued.

You will also find Alexco’s news release with quarterly financial results there. This conference call will be recorded and archived on the company’s website under Events and Webcasts.

Giving presentations on today’s call will be Clynt Nauman, Chairman and Chief Executive Officer; Brad Thrall, President; and Mike Clark, Chief Financial Officer. We will have a question-and-answer period after our presentations.

Before we get started, I need to remind you that some statements made today may contain forward-looking information. Our business involves a number of risks that could cause results to differ from projections and investors are urged to consider those disclosures and discussions pertaining to risks that can be found in Alexco’s SEDAR filings.

It should also be noted that past performance discussed in this conference call is not indicative of future results. I would now like to turn the call over to Clynt Nauman.

Thanks, Lisa and thank you for joining us today for review of our 2017 third quarter. As you have heard us say before, we are steadily moving forward with the development of the Bermingham and Flame and Moth silver deposits.

Putting the Keno Hill Silver District back into production remains our strong focus. We are executing the plan on a couple of phases to ensure that risks are managed and we are making sure we execute each step in a safe and effective manner.

As you know, we have a unique and financially robust project with infrastructure already in place, silver grades that are unparalleled on the global stage. We have a relatively short runway to get back into production, and best of all, we have a team of professionals and operators who share the same goals.

As a result of our disciplined approach throughout this process, this redevelopment process, I expect to see the company move steadily up the value curve over the next year or so. Talking about value, I am sure most of you are as frustrated as we are to see our share price drop from approximately $2.60 to $1.40 over the last 9 months or so, more recent steeper decline, 24% between October 6 and 30 is obviously indicative of a seller, likely program driven.

Fortunately, the algorithm, if that’s where it was, took a break a couple of days ago and we have recovered a little. I think the important thing to remember is that although our share price has retraced, nothing has changed with the company.

We remain focused on our objectives, at Keno Hill and like I said, we are steadily moving forward. Market aside, on this call today, we will briefly discuss the highlights from the third quarter and then give updates on 2017 and some guidance or plans for the next 12 months.

Brad will discuss the operations, development and progress in our underground work at Keno Hill and Mike will walk us through a summary of the financials. On that note, we released our financial results yesterday outlining a net loss of $2.3 million for the quarter ended September 30.

Of this, $1.9 million were non-cash items comprising depreciation expense, share-based compensation expense, a loss on mark-to-market investments and deferred income tax expense. From the company operations perspective, some of the highlights during the third quarter included firstly, the company in August received an amended Class IV permit allowing the commencement of a 580-meter underground exploration decline into the Bermingham deposit.

We are currently above the 125 meters into that decline. Secondly, in September, we completed a 13,800 meter service exploration program in the immediate vicinity of the high-grade Bermingham deposit.

It is also in this look it can be expected within the next week. And thirdly, AEG had a good quarter with $3.8 million in revenues for a gross profit of $1.5 million.

Now, let’s put that in context with the work we are doing and planning for the balance of 2017 and into 2018. Specifically, the amended costs will come at a [indiscernible] to commence the Bermingham decline.

And about 20% completion presumably we expect to complete the big line in first quarter 2018. Awareness is off [indiscernible] and the advancement of these declines were well underground and beginning to size on a routine basis.

The surface exploration program at Bermingham was completed in September 2017 and we expect to report on results next week. As is typical with Alexco, we make sure that we have enough [indiscernible] compiled to place the results in context with the existing deposits or prior discoveries.

We will do that next week. Alexco remains in strong financial shape with unrestricted cash and cash equivalents of $21.4 million and working capital of $22.9 million.

This gives us plenty of runway to consider our options as we move towards a production decision in 2018. At this point, I am going to turn it over to Brad to continue with the discussion on advanced exploration decline at Birmingham and other operations as we go forward.

Brad?

Thanks, Clynt, and good morning everyone. Advancement and underground exploration decline and underground drilling program at the Bermingham deposit in 2017 and into 2018 remains our primary focus at Keno Hill.

We have already started advancing this decline in underground program and we are currently 125 meters advanced out of the total of 580 meters. Our timeline for completion of the decline is within the first quarter of 2018.

Following the completion of the decline in Q1, we would then initiate approximately 5,000 meters of infill and confirmation drilling in the Bermingham deposit, mostly focused on the upper portions of the deposit that are included in the early years of the PEA mine plan. With a couple of drills, we will then take approximately 2 months to complete this underground exploration program.

In addition, we will complete further geotechnical and hydrological drilling and investigations underground at Birmingham that is required for more detailed mine planning and design purposes. This overall program is estimated to cost approximately $8.7 million, including underground equipment rebuilds and purchases.

The Bermingham underground exploration program will comprise infill drilling to tighten up the spacings to approximately 5 to 10 meter centers and to confirm the location, geometry and grade of the mineralization with the objective of upgrading the existing inferred resources to indicated resources and upgrading existing indicated resources to a measured resource status. This will also increase confidence in the geological model as well as advance our mine design and studies to a pre-feasibility level study.

Some additional exploration work looking for extensions to the high grade mineralization will also be completed from the underground drilling stations. In addition to the underground work at Bermingham, we will continue to make improvements and upgrades to the mill as well as begin construction on the water treatment plant that is required for the Flame and Moth mine.

The company has recently received a draft amended type A water use license from the Yukon Water Board for the Flame and Moth deposit. This amendment allows under certain conditions the use and discharge of treated water and depositional dry stack tailings from the Flame and Moth mine.

The final amended water use license is expected before the end of 2017. Once required, the amendment represents the final authorization required for ore production from the Flame and Moth silver deposit, in addition to the Bellekeno, Lucky Queen and Onek deposits that are already fully permitted.

In November, we will submit a project proposal for environmental assessment and permitting for the eventual production and processing of ore from Birmingham. This process is expected to take until the end of 2018.

The guidance just discussed in permitting is consistent with the schedules and timelines disclosed in the March 2017 PEA, which targets production to commence in the fourth quarter of 2018. So at this point, I am going to turn it back over to Clynt to summarize what we are working towards over the next 12 months.

Clynt?

Thanks Brad. I think that this is a good time to describe again the pathway back to production and a few decision points along the way.

So, as Brad discussed, the first phase of our redevelopment program is well underway with the advancement of the decline of Bermingham. Once the decline is completed estimated in the first quarter of 2018, we will make a decision on Phase 2 of our plan, which will involve proceeding with the Flame and Moth decline and beginning the re-commissioning activities at the mill.

The 965-meter declines at Flame and Moth is expected to take approximately 7 to 8 months to complete at an estimated direct cost of $10.6 million. Remember, that our estimated total capital investment to achieve production is about $27 million, including approximately $2.5 million spent to-date in 2017.

That capital is anticipated to take us through a positive cash flow position, so it includes working capital and inventory scale-up. As Brad noted, upon completion of the Bermingham decline, we’ll launch a 5,000-meter $2 million underground infill drilling program and exploration program totaling approximately 30 to 40 holes.

With these results and results from our 2017 service exploration program, we intend to prepare a pre-fease study, which was expected to be complete in the third quarter of 2018. If all of that goes ahead as planned and on time, we would expect to have a Flame and Moth decline completed in the latter part of 2018.

This completion of the decline is a critical path to production and critical as early as the quarter will occur in the fourth quarter of 2018. A decision point to drive this decline will be the first quarter of 2018 when we will take a close look at market conditions, exchange rates, smelter cost trends, metal prices, drilling results and our finances.

Once we pull the trigger on the Flame and Moth decline, there is no question that we are heading for a production-ready result in late 2018. And currently with all the said activity, we will complete the permitting process for production from the Bermingham deposit simply amending our existing Quartz Mining License and Water Use License.

We expect this process to be complete by the end of 2018. Just to be totally clear, once the Bermingham process is complete we will be fully authorized for mining and processing operations from each of the Bellekeno, Flame and Moth, Lucky Queen and Bermingham deposits.

I want to make a comment on exploration. For the last several years, since 2013 actually, we are focused on discovery and immediate follow-up drilling through outlined potentially mineable mineralization.

I just noted, over this period, we have found and drilled out through deposits, the Flame and Moth deposits and the Bermingham deposits totaling about 44 million ounces of indicated silver and an average grade between 500 and 600 grams per ton silver. About half of that total is at a grade of 800 grams or better and our geologists have found plenty of ounces and plenty of time to see the 400 ton per day mill.

For next year, our exploration focus will be through supply costs from Bermingham and from Flame and Moth looking for another deposit. Simply stated, we have two deposits in the bank that opened and that we further explored from underground, but in terms of service exploration, it’s a question of shifting our focus from the successes that we have had and looking for the next one.

The exploration bar is high at Keno Hill, you have to remember and it’s pretty exciting actually. From the explorations perspective, for discovery to make it into production at Keno Hill, it has to be at least 800 grams per ton silver and needs to be shallow and mineable for configuration and likely has to be 4 million to 5 million ounces in size.

Turning to the environmental side of the business, AEG posted a strong third quarter with [Technical Difficulty]. Our U.S.

operations have picked up a number of projects with [Technical Difficulty] making steady advancements towards active [Technical Difficulty] at Keno Hill. At this point, I am going to turn it over to Mike to review the financial numbers.

Thanks, Clynt. This financial report is for Alexco’s quarter ended September 30, 2017.

Note that all amounts will be reported in Canadian dollars. For the third quarter of 2017, we recorded a net loss of $2.3 million for a loss of $0.02 per share.

This loss includes non-cash costs of $406,000 for depreciation and amortization, $389,000 for share-based compensation expense, $517,000 for a loss on investments held and $588,000 of deferred income tax expense. This is an increase in loss compared to the third quarter of 2016, which recorded a net loss of $640,000 for a loss of $0.01 per share.

The main difference between the loss in the 2017 period and the 2016 period is because of the following. A difference of $1.6 million related to the 2017 period incurring a loss on investments of $517,000 compared to the 2016 period recording a gain of $1.1 million on investments held.

Secondly, an increase in share-based compensation expense in the amount of $202,000 for the 2017 period. And thirdly, an increase in deferred income tax expense by $195,000 and all of this was offset by an increase in profitability by $835,000 in the environmental consulting business.

AEG revenues for the quarter were $3.8 million with a gross profit of $1.5 million achieving a gross margin of 41%. This compares to revenues in the third quarter of 2016 of $3.2 million with a gross profit of $710,000 achieving a gross margin of 22%.

The 19% increase in gross profit from the prior year period was primarily due to U.S. operations being awarded several new projects.

Corporate, general and administrative expenses for the third quarter of 2017 totaled $1.56 million, including non-cash costs of $410,000. This compares to the third quarter of 2016 costs of $1 million, which included $207,000 of non-cash costs.

The increase in the 2017 period relates to $126,000 increase in regulatory fees related to share issuances and a $202,000 increase in share-based compensation expense. AEG general and administrative expenses for the third quarter of 2017 totaled $694,000.

This compares to the third quarter of 2016 expenses of $669,000. The 4% increase in the 2017 period is primarily as a result of a minor increase in salaries during the period.

Mine site care and maintenance cost in the third quarter of 2017, were $421,000 compared to $475,000 in the same period of 2016. The 11% reduction in costs is mainly due to lower depreciation charges in the 2017 period.

Included in mine site care and maintenance cost is depreciation expense of $327,000 in the third quarter of 2017 compared to $407,000 in the third quarter of 2016. Exploration expenditures incurred during the third quarter of 2017 totaled $3,491,000 compared to $3,040,000 in the 2016 period.

The 2017 period expenditures were incurred primarily for the surface exploration drill program and the advanced underground exploration program at the Bermingham deposit. The 2016 period expenditures were incurred primarily on the surface exploration drill program at the Bermingham deposit.

Alexco’s unrestricted cash position at September 30, 2017 was $21.4 million compared to $20.4 million at December 31, 2016, while net working capital was $22.9 million compared to $23.4 million at December 31, 2016. The unrestricted cash during the third quarter of 2017 decreased primarily as a result expenditures on the surface exploration program, commencement of the exploration decline at the Bermingham deposit, equipment and mining fleet rebuilds at site and offset by the profitability in the consulting business.

In addition to the unrestricted cash, Alexco has restricted cash at September 30 of $7.1 million, which primarily relates to decommissioning obligations at Keno Hill. Thank you, Mike.

Operator, would you now provide instructions for the Q&A session.

Brad, Clynt can you both still hear?

Yes, I am still on.

Yes, okay. Operator?

Sorry, everyone. I will just step away and see if I can’t solve this issue.

Yes, hi, guys. Just a couple of questions for me.

First, at what level, would you consider if you would consider hedging in your Canadian dollar or is it more of a timing thing when you get closer to making that production decision?

Hi, Mike, this is Clynt. Yes, it is somewhat related to timing.

I mean, we do most of our numbers in the low to mid $0.80 range and so anywhere either in that kind of range would be acceptable for us, if in fact we ran a currency program.

Okay. But that sounds like it would be more of like a Q1 next year decision?

Yes, absolutely. Yes, we wouldn’t make that decision at the present time.

Okay. And then my second question is the environmental division, just remind me what the backlog is there and what the rough kind of timing is of some of those contracts?

Well, there is about $100 million of backlog and most of the heavy lifting on that work will start in 2019 and last year probably 4 to 5 years.

Okay, great. Thanks.

That’s it for me.

Hi, Clynt. Question about when you start the water license permitting with Bermingham, do you get that amended, do you see any particular issues or is that a pretty straight line to approval?

I am going to have Brad respond to that, Mike, but anyway good morning.

Yes, Mike. Yes, again, as you know we have been through the permitting process several times at Keno Hill, Bermingham deposit is located on Galena Hill, which is about 8 to 9 kilometers away from the mill.

So, we don’t really anticipate – certainly any new issues arising that we haven’t already dealt with in terms of water traffic whatever it might be. There will be no changes to the mill in terms of throughput or dry stack tailings or water management that would require any further assessment or permitting.

So, it’s really focused just on the Bermingham mine itself, which again is several kilometers away from the mill itself right now.

And also as mentioned a couple of places with some the amount it’s going to be spent on Flame and Moth $10.6 million and $8.7 million for Bermingham. Also, that the pre-fease or the PEA mentioned a $27 million cost and I think Clynt said $2 million of that’s been spent.

Is that $10.6 million and $8.7 million part of the $27 million or about what’s the gap there that’s going to need to get filled between the $21 million that you currently have in the treasury?

Well, it might be. As you pointed out, we are already underway at Bermingham and so that our hedge position relative to what’s required to get back to production is very close obviously.

And we feel that we have got plenty of runway here. We have got lots of options in terms of financing.

We have ones that are maybe not in the money today at work and a couple of weeks ago, the $5 million ones out there that if they were exercised would net $8 million to $9 million, where we are talking a lot on the commercial side to people who have closely to our product that our product. And we have other initiatives underway.

So we are aware that it’s close if you like, but we have lots of options and lots of time to look and talk about. That and that’s one of the reasons that once we are complete with the Bermingham decline, we are going to sit back here and make a very deliberate decision to pull that trigger on the last decline at Flame and Moth.

Okay. So, we look forward to that.

With regards to the decline, I think Brad mentioned looking at upgrading and further indicated the measured from a classification point of view, but I thought you also said that you might be drilling deeper, does that – could I dream wide-eyed that there might be additional discoveries at depth?

Well, I mean, there is – we have not published 2017 drill results yet. So, I think that the best thing – the best option to that question is, let’s wait and see, what those results look like, but from underground I can tell you that we are going to have 160 meters sort of start on it and so yes, there will be some holes that are drilled deeper than the existing resource for sure.

And regarding AEG, congratulations on revenues and gross profit, the name Schwartzwalder is new to me without breaking any agreements. Can you describe what type of project that is?

Is it a passive or an active or is it a water treatment plant or is there anything you can say about that so that we can start tracking that?

Just – there is a just large underground former uranium producing operation in Colorado and we are engaged there to treat the water that’s in the mine, pretty straightforward from our perspective, but a very large mine and there was an operation for a long period of time.

Thank you. And I just want to say about a year from now we could be actually looking at going back into production and a year isn’t a very long period of time.

Thanks for taking my call.

Thanks Mike.

No, I just didn’t want to hog the call, Clynt. With regards to Gold King, I know that started out as a temporary emergency effort that you guys came in and setup for winter training, but you classed it a lot longer than just the winter season, is there anything you can say about the length of that contract?

And that is my last comment. Thank you.

Well, thank you again, Mike. And we are sort of staying at operations level at Gold King and that continues year-over-year.

We have every expectation [Technical Difficulty].

Thank you for joining us today. We remain dedicated to move into Keno Hill Silver District back towards production.

We have a busy year ahead as you have heard it with a little less than 1,500 meters of declines to drive an extensive underground drill program to execute and the pre-feasibility level study to complete. Our strong cash position gives us plenty of runway to meet our objectives in a disciplined and a deliberate manner.

As explained, there will be clear project decision points as we progress with the development, first, being the completion of the Bermingham decline in the first quarter of 2018 and the decision to launch into the Flame and Moth decline, and then with completion of the Flame and Moth decline, the decision point to proceed to production which we anticipate will come at end of 2018. As always, we appreciate your support and interest in Alexco.

And with that, I will turn it back to Lisa to close the call.

You’ve been listening to the Alexco Resource September 30, 2017 third quarter conference call. We encourage investors to visit Alexco’s website for further information at www.alexcoresource.com.

If you have further questions, please call my direct line at 778-945-6577 or e-mail me at [email protected]. This concludes today’s call.

Thank you for joining us. Have a great day.