Becoming a globally recognized gold company
Exeter Resource Corporation is a Canadian public company listed on the Toronto Stock Exchange (TSX) under the symbol XRC and NYSE Amex exchange with the symbol XRA. Our focus is the discovery, evaluation and development of gold deposits in Chile and Argentina.
As of January 24, 2010 the company had $75 million dollars, a cash reserve considered sufficient to fund expenditure over at least the next year at current levels of activity, including drilling on the Company’s Caspiche and Cerro Moro projects. Exeter plans to retain sufficient cash reserves so that the longer term viability of the Company is ensured.
Exeter’s Caspiche Project in Chile (option to own 100% from Anglo American Chile Limitada) is a gold-copper porphyry system, a type of deposit common to many of the world's largest open pit gold-copper mines. It is located 15 kilometres (8 miles) south of Kinross Gold's Refugio mine (+6 million ounce gold resource), and 10 kilometres (6 miles) north of the very large Cerro Casale gold-copper deposit (24 million ounce gold resource), jointly owned by Kinross Gold and Barrick Gold.
In October 2009 Exeter announced an updated National Instrument 43-101 (“NI 43-101”) compliant mineral resource estimate for Caspiche, for all drilling conducted to end 2008-2009 drill season. The inferred resource is 19.6 million ounces gold, 4.84 billion pounds of copper, and 40 million ounces of silver, or 32.4 million gold equivalent ounces (refer to October 20, 2009 News Release). The additional 12.8 million ounces of gold equivalent is calculated using a copper conversion price of US$2.00 per pound, a silver price of US$12.00 per ounce and a gold price of US$800 per ounce (assuming 100% recovery). The resource estimate leaves the deposit open for expansion to the southeast and to depth.
Drilling re-commenced at Caspiche in October with a programme that will build to a total of four drill rigs and will continue through to May 2010. The drilling program has been designed to expand the resource, to in-fill the highest grade area to improve the status to “indicated resource”, and for infrastructure, metallurgical, engineering and environmental studies. The Company has budgeted C$13 million to conduct this program from September 2009 through to September 2010.
The Cerro Moro Gold-Silver Project in Santa Cruz Province, Argentina is 100% owned by Exeter, with the Santa Cruz Government Mining Company, Fomicruz S.E. entitled to a 5% interest, on completion of mine permitting.
In July, 2009, Exeter announced an initial inferred mineral resource estimate for drilling completed to the end of 2008. The inferred resource is 646,000 ounces gold equivalent at a grade of 18 grams per tonne ("g/t") gold equivalent (refer to the July 8, 2009 Press Release). The Company's focus will be to advance drilling on the Escondida vein, which contains 518,000 ounces gold equivalent at a grade of 34 g/t gold equivalent. Engineering, environmental and infrastructure studies will also be advanced ahead of a scoping study planned for 2010. Exeter is now conducting a detailed drilling program on Escondida in order to upgrade the portions of the inferred resource that might be scheduled for early mining to the "indicated resource" category. This program entails some 30,000 metres of drilling and is expected to be completed by year end.
Drilling has also commenced to test for possible high grade extensions of the Escondida zone onto the adjacent Fomicruz joint venture lands where the Company may earn an 80% interest by incurring certain exploration expenditures. This zone will be tested over a strike length of two kilometres (1.25 miles), a similar distance to that tested to date on Escondida. The Company has budgeted C$8 million from September 2009 through September 2010 for the drilling focused Cerro Moro program.
We believe Cerro Moro has the potential to be developed as a low capital cost mining operation and the possibility of increasing the resource base is excellent.
From Q4-2009 onwards, Cerro Moro activities will likely focus on mine development studies. The gold deposit should benefit from being very high grade by industry standards, and being near the port of Puerto Deseado where substantial infrastructure is available. It is also within an established gold-silver district, with mines owned by AngloGold Ashanti, Pan American Silver, Coeur d’Alene Mines and Minera Andes/Hochschild.
The Don Sixto Gold Project is located in Mendoza Province, Argentina (Exeter option to own 100%). Following detailed drilling conducted through 2005-2006 the Company announced a NI 43-101 compliant estimate of gold resources in 2007. At a 0.5 g/t gold cut-off grade the "measured and indicated resource" is 925,000 ounces of gold (20.48 million tonnes at an average grade of 1.40 g/t gold) and the "inferred resource" is 334,000 ounces of gold (9.29 million tonnes at a grade of 1.12 g/t gold). The resource is detailed on this website.
In June 2007, the Mendoza government passed legislation that severely restricts mining in Mendoza Province. Exeter immediately suspended exploration on the Don Sixto property and filed an action in the Mendoza Province Supreme Court to have the legislation declared unconstitutional. Evidence is currently being presented and the Company is hopeful that a resolution will be forthcoming in the first half of 2010. The Company will continue to work with all levels of government, industry, unions and other interested parties to demonstrate that the project, if economically viable, could be developed responsibly and on a sustainable basis.
Exeter has other drill ready gold-silver targets in prospective regions of Patagonian Argentina and Chile that are currently on hold. The Company gained a broad foothold in the region through separate strategic alliances with Cerro Vanguardia S.A. (an AngloGold Ashanti subsidiary), and Rio Tinto Mining and Exploration Chile.
Exeter is well positioned for success. Our projects are proving to be uniquely valuable, and our strategic agreements with major companies provide a "pipeline" of growth opportunities.
