Former employees of the bankrupt United Keno Hill Mines Ltd. have lost their attempt to claim unpaid wages by filing a lien against two mineral claims in the Elsa area.

Alexco Resources obtained the claims in question last spring.

The company filed a motion with Yukon Supreme Court last Friday indicating the outstanding liens were blocking the company's ability to finalize a major financing deal.

On Tuesday afternoon, Whitehorse lawyer Grant Macdonald pointed out to Justice Ron Veale that the liens were directed at United Keno Hill as a means of collecting the unpaid wages.

Macdonald, however, noted the three former employees filed the liens on Dec. 1, 2000 against two mineral claims that hadn't been in the possession of United Keno Hill since 1983.

Furthermore, he said, the three lien holders failed to file the necessary evidence as to support their claims, as required by the Miner's Lien Act.

Macdonald acknowledged it was somewhat out of the ordinary to proceed with the cause without the lien holders present, but noted that under the circumstances, rules of the court do allow for these instances.

The liens were filed by Robert Andison, Yvonne Bessette and Lloyd Melnychuk.

The three long-time employees of the company have maintained they remained faithful to their United Keno employer even when the company was on its last legs, in the throes of bankruptcy.

None of the three lien holders could be reached for comment this morning, though their claims for unpaid wages were for well in excess of $100,000.

The records show the bankrupt company left between $12 million and $15 million in bad debt at the time of its demise.

United Keno had sold the two mineral claims in question to the Canada Tungsten Corp. in 1983. The Tungsten Corp. sold them to Springmount Operating Co. in 1987, and Alexco picked up the claims from Springmount last April.

Earlier this month, Alexco announced a major $50-million financing arrangement to advance its plan to bring the Bellekeno mine back into production in 2010.

In the court documents, the company indicated "the release and discharge of the respondents' liens is a condition to the advance of a significant portion of the financing."

In his Oct. 2 address to the Opportunities North '08 conference in Whitehorse, Alexco president Clynton Nauman told participants his company estimates

it can mine silver at Bellekeno for under $2 US an ounce. Silver was trading this morning at $10.01 an ounce.

The former silver mines and associated properties in the Elsa and Keno City area were declared abandoned by the federal government in 2001.

Left to the care of the Canadian taxpayer, there were court-approved attempts to unload the assets, though none were successful.

Companies that showed an interest continually rejected the condition that with the purchase, they would assume responsibility for the environmental liabilities from a century of mining.

It wasn't until Ottawa agreed to sever the environmental liabilities from the deal that Alexco pursued the purchase.

The purchase agreement does commit Alexco to some reclamation obligations, though taxpayers are still paying the cost of babysitting the past environmental liabilities at a cost of $1.7 million for this fiscal year alone.

In addition to the care and maintenance expense, Ottawa budgeted another $1.3 million this year to conduct studies and other activities aimed at developing a plan to deal with those liabilities on a permanent basis.