Till I came to the marge of Lake Lebarge, and a derelict there lay; It was jammed in the ice, but I saw in a trice it was called the "Alice May."
Now, finally, when it seems like our hero can’t take any more, we all get some relief. He arrives at the "marge" (the shore) of Lake Lebarge (an actual place, outside of the town of Whitehorse, in the Yukon).
It’s not clear why this is a good thing yet, but at least it’s a change of scene.
The first thing the speaker notices is a "derelict," the wreck of a ship stuck in the ice. He can see right away ("in a trice") that the ship is named the Alice May. That’s actually not so key to the poem, but it rhymes nicely, right? Some folks also think that Service based it on a real Yukon riverboat called the Olive May.
And I looked at it, and I thought a bit, and I looked at my frozen chum; Then "Here," said I, with a sudden cry, "is my cre-ma-tor-eum."
The speaker looks at the boat, and at the corpse, and he suddenly gets an idea. He’ll use this boat to burn his friend’s body.
Can you feel how the mood has lightened up a little? A few lines before, the body was a "hateful thing," but now it’s his "frozen chum." Plus, there's the kind of goofy way that last word is stretched out: "cre-ma-tor-eum." (A crematorium, by the way, is a place where a body is cremated.)
After the scary, horrible stanzas before it, the poem feels almost silly again.