Exeter provides update on proposed spin-out to create two independent companies
February 11 2010 - 9:00AM
PR Newswire (US)
RESTRUCTURING TO UNLOCK THE VALUE OF THE HIGH GRADE CERRO MORO
GOLD-SILVER PROJECT IN ARGENTINA VANCOUVER, Feb. 11
/PRNewswire-FirstCall/ -- Exeter Resource Corporation
(NYSE-Amex:XRA, TSX:XRC and Frankfurt: EXB - "Exeter" or the
"Company") has obtained an interim order from the British Columbia
Supreme Court providing for a special meeting of shareholders (the
"Meeting") required to approve the spin-out of its Argentine assets
into a new company to be known as Extorre Gold Mines Limited
("Extorre"). Exeter shareholders of record on January 27, 2010 will
be asked to vote on the proposal at the Meeting, which is expected
to be convened on March 11, 2010. If approved, the transaction will
result in each Exeter shareholder on the effective date of the
transaction (expected to be on or about March 17, 2010), receiving
one share in Extorre for each share held in Exeter on that date.
There will be no change in shareholders' holdings in Exeter. As
announced, under the terms of the transaction Exeter will retain
all assets relating to the Caspiche gold-copper discovery, together
with approximately $50 million in working capital, and focus on the
advancement of Caspiche. Exeter will transfer to Extorre the Cerro
Moro and other Argentine exploration properties and approximately
$25 million in working capital. Extorre will become an emerging
gold-silver producer focused on the high grade Cerro Moro
gold-silver project in Argentina. Extorre will focus on taking
Cerro Moro through a Preliminary Assessment Study in Q3-2010. That
report that will provide a detailed description of a potential mine
at Cerro Moro, including forecast production rates, capital costs,
operating costs and cash flows. Extorre also intends to increase
the Cerro Moro resource by drilling the many partially explored
veins on the property. Dr. Eric Roth will be CEO and President of
Extorre. Eric has worked as a mine geologist on gold mines in
Australia and Chile, and as an exploration geologist globally for
BHP, the Rio Tinto Group companies and AUR Resources. More
recently, Eric was Global Exploration Manager for AngloGold
Ashanti. Darcy Daubaras will be CFO and Yale Simpson and Bryce
Roxburgh will act as joint non-executive Chairman of the Board. The
board of directors will consist of Yale Simpson, Bryce Roxburgh,
Louis Montpellier, Cecil Bond, Robert Reynolds and Ignacio
Celorrio. Mr. Celorrio is an Argentine lawyer and partner at
Quevedo Abogado, whose practice includes mining law. He is also the
president of Malbex San Juan S.A., Minera Cielo Azul S.A., and
Inversiones Mineras Australes S.A The transaction is subject to
shareholder and regulatory approvals, including approval of the
Toronto Stock Exchange, the NYSE Amex and the Supreme Court of
British Columbia. An information circular setting out further
details of the transaction and the Meeting will be mailed February
17th 2010. About Exeter Exeter Resource Corporation is a Canadian
mineral exploration company focused on the discovery and
development of gold and silver properties in South America. The
Company has C$77 million in its treasury. On January 19, 2010 the
Board approved a proposal to undertake a spin-out transaction
pursuant to which the assets of Exeter would be separated into two
highly focused companies. On the Caspiche Project in Chile an
inferred mineral resource estimate of 1,117 Mt (million metric
tons) at a grade of 0.55 grams per metric ton gold and 1.12 grams
per metric ton silver including 1,017 Mt at a grade of 0.22% copper
was announced in September 2009. This equates to in-situ inferred
resources of 19.6 million ounces of gold, 40 million ounces of
silver and 4.84 billion pounds of copper (a total of 32.4 million
gold equivalent ounces*. Drilling with six rigs is underway to
expand and upgrade the resource. On the Cerro Moro Project in
Argentina an initial inferred mineral resource estimate of 646,000
ounces gold equivalent** at a grade of 18 g/t gold equivalent** was
announced mid-2009. A new Cerro Moro resource estimate is scheduled
for April 2010, to be followed by a Preliminary Assessment Study as
noted above. These studies will form the basis of a mine
development decision and the submission of the project to
Provincial authorities for permitting. Exploration drilling will
continue through 2010. Matthew Williams, Exeter's Exploration
Manager and Justin Tolman, Exeter's Caspiche Project Manager both
considered a "qualified person" within the definition of that term
in National Instrument 43-101, Standards of Disclosure for Mineral
Projects, has supervised the preparation of the technical
information contained in this news release. You are invited to
visit the Exeter web site at http://www.exeterresource.com/. EXETER
RESOURCE CORPORATION Bryce Roxburgh President and CEO *Gold ("Au")
equivalence for copper ("Cu") and silver ("Ag") was calculated by
Exeter using assumed metal prices of US$800/ounce ("oz") for Au,
US$12/oz for Ag and US$2/pound ("lb") for Cu. The formula to
calculate Au equivalence for Cu was pounds of Cu multiplied by 2
and divided by 800; Au equivalence for Ag was calculated using the
formula oz of Ag multiplied by 12 and divided by 800, and in both
cases assumes 100% recovery. Reported grades and metric tons have
been rounded (see news release NR 9-22 dated October 20, 2009).
**Inferred mineral resource estimate of 1,098 Mt containing 371,000
ounces gold at a grade of 10.5 g/t and 19.2 million ounces silver
at a grade of 545 g/t for 646,000 ounces gold equivalent at a grade
of 18 g/t gold equivalent. Gold equivalent is calculated by
dividing the silver assay result by 70, adding it to the gold value
and assuming 100% metallurgical recovery (see news release NR 9-14
dated July 8, 2009). Safe Harbour Statement - This news release
contains "forward-looking information" and "forward-looking
statements" (together, the "forward-looking statements") within the
meaning of applicable securities laws and the United States Private
Securities Litigation Reform Act of 1995, including the Company's
belief as to the extent and timing of its drilling programs,
various studies including engineering, environmental,
infrastructure and other studies, and exploration results, budgets
for its exploration programs, the potential tonnage, grades and
content of deposits, timing, establishment and extent of resources
estimates, potential for financing its activities, potential
production from and viability of its properties, expected cash
reserves and the expected benefits of the proposed spin-out
transaction. These forward-looking statements are made as of the
date of this news release. Users of forward-looking statements are
cautioned that actual results may vary from the forward-looking
statements contained herein. While the Company has based these
forward-looking statements on its expectations about future events
as at the date that such statements were prepared, the statements
are not a guarantee of the Company's future performance and are
subject to risks, uncertainties, assumptions and other factors
which could cause actual results to differ materially from future
results expressed or implied by such forward-looking statements.
Such factors and assumptions include, amongst others, the effects
of general economic conditions, the price of gold, silver and
copper, changing foreign exchange rates and actions by government
authorities, uncertainties associated with legal proceedings and
negotiations and misjudgements in the course of preparing
forward-looking information. In addition, there are also known and
unknown risk factors which could cause the Company's actual
results, performance or achievements to differ materially from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Known risk factors include risks
associated with project development; the need for additional
financing; operational risks associated with mining and mineral
processing; fluctuations in metal prices; title matters;
uncertainties and risks related to carrying on business in foreign
countries; environmental liability claims and insurance; reliance
on key personnel; the potential for conflicts of interest among
certain officers, directors or promoters of the Company with
certain other projects; the absence of dividends; currency
fluctuations; competition; dilution; the volatility of the
Company's common share price and volume; tax consequences to U.S.
investors; and other risks and uncertainties, including those
described in the Company's Annual Information Form for the
financial year ended December 31, 2008, dated March 27, 2009 filed
with the Canadian Securities Administrators and available at
http://www.sedar.com/. Although the Company has attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements. The Company is under no obligation to
update or alter any forward-looking statements except as required
under applicable securities laws. NEITHER THE TSX NOR ITS
REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE
POLICIES OF THE TSX EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS NEWS RELEASE DATASOURCE: Exeter
Resource Corporation CONTACT: B. Roxburgh, President, or Rob Grey,
VP Corporate Communications, Tel: (604) 688-9592, Fax: (604)
688-9532, Toll-free: 1-888-688-9592, Suite 1260, 999 West Hastings
St., Vancouver, BC, Canada, V6C 2W2,
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