10/04/2011 05:09 EDT | Updated 12/04/2011 05:12 EST

Military says small Air Tindi aircraft crashed east of Yellowknife.

LUTSEL K'E, N.W.T. - Residents of this tiny northern community are counting their blessings after two of their own survived a plane crash Tuesday that killed a pilot and a passenger from Yellowknife.

"It was a very stressful day with the news and not knowing what the situation was," said Ray Griffith, band manager in Lutsel K'e. "So it was a huge relief to the community that their two members survived."

Griffith said community residents Sheldon Catholique and Bernice Marlowe had been taken to hospital but were expected to recover from their injuries.

"Apparently they're in not too bad condition," Griffith said. "One person is in some sort of surgery in Yellowknife and the other person is in fairly good condition.

"This is a small community of 400 people with no roads, so everybody is very close and spends all their lives together."

However, he added that everyone was saddened by the death of the pilot and an employee from the Northwest Territories Power Corp.

The plane was on a regularly scheduled flight from Yellowknife to Lutsel K'e to the east. It was about 25 kilometres from its destination when the pilot decided to turn around in rainy but calm weather, said RCMP Cpl. Shawn King.

"I have no information on why that decision was made," King said. "A short time later, radio contact was lost."

Griffith said the plane, which was not equipped with float pontoons, crashed on a narrow peninsula that is almost completely surrounded by water. He said it also narrowly missed a massive cliff.

Rescuers responded immediately.

A privately owned Twin Otter landed on Great Slave Lake near the crash site and rescuers beat their way through the bush to the site.

As well, a helicopter owned by Great Slave Helicopters went to the site, as did a Royal Canadian Air Force Hercules search and rescue aircraft. RCMP also helicoptered to the site.

“Our hearts ache for the families of the two individuals who have lost their lives in this tragic incident and our prayers are with the two injured survivors,” said Chuck Parker, president of Air Tindi, which owned the downed Cessna Caravan.

It's the third crash in the Canadian Arctic in recent weeks.

On Aug. 20, a First Air Boeing 737 crashed near Resolute, Nunavut, killing 12 and injuring three.

Two pilots died on Sept. 22 in the crash of a Twin Otter in Yellowknife's Old Town neighbourhood. Seven were injured.

"It's been astonishing," said Griffith. "Particularly with the one in Yellowknife not even two weeks ago. That also was a company that serves this community regularly."

He said it's making people nervous about flying, but they don't have much choice, as there are no roads to the community.

"People fly so much and we've been doing it for so many years and nothing has ever happened until now."

RCMP from Lutsel K’e currently have secured the the scene. Investigators from the RCMP and the Transportation Safety Board are expected on site Wednesday.

The airline flew Prince William and Kate during their visit to the Northwest Territories this last summer.