Exeter Resource Corporation (XRA)

[Hurricane_Rick]

EXETER PROVIDES UPDATE ON WATER EXPLORATION AND ENVIRONMENTAL
STUDIES FOR CASPICHE GOLD PROJECT, CHILE
Monday 15 October 2012

Exeter Resource Corporation (NYSE MKT:XRA)(NYSE Amex:XRA)(TSX:XRC)(FRANKFURT:EXB) ("Exeter" or the "Company") is pleased to provide a further update on studies in support of the potential staged development of the Caspiche gold-copper project located in the Maricunga region of Chile.

Earlier studies conducted by the Company indicated the potential to recover gold from oxide ore in the upper 200 metres of the Caspiche deposit. This "Oxide Project" would represent the first stage of the potential commercial development of the very large Caspiche deposit.

Recent activities relating to water supply development and an environmental impact assessment application ("EIA") for the Oxide Project include the following:


-- Data compilation and water balance studies on Exeter's optioned Rio
Penas Blancas water rights. Initial results indicate sufficient water
may be sustainably available for the scale of operation being considered
for the Oxide Project.

-- Continued collection of environmental base line data to support the EIA
required for development of the Oxide Project. Activities include an
evaluation of any potential for acid rock drainage from waste dumps and
a continuation of community studies to align the Caspiche project with
International Labour Organisation Article 169 pertaining to indigenous
communities.

Water Supply:

As previously reported, Exeter continues to investigate the Rio Penas Blancas and Rio Aguas Dulces areas, where the Company has an option over granted surface water rights. The option covers a total of 300 litres a second ("l/s") from surface flows into Laguna Verde. Schlumberger Water Services ("SWS"), Exeter's consultant for this work, is supervising comprehensive measurement and test programs with the objective of modelling the potential harvesting of a portion of these water flows on a sustainable basis. Parameters being measured include stream flow and temperature measurements, lake bathymetry and levels, water quality and meteorological conditions.

The Oxide Project water requirement is approximately 85 l/s, substantially below the 300 l/s of water covered by the water rights optioned to Exeter.

The preliminary report from SWS indicates the following key conclusions:


-- Rio Penas Blancas water flows change seasonally in the range of 200 to
700 l/s. These data are comparable with other investigations in the
area. Rio Aguas Dulces flows range between 20 and 60 l/s.

-- SWS's estimate of the groundwater flow rate additional to surface flow
is 30 l/s

-- Laguna Verde volumes and levels have been reducing slowly during a 35
year long dry period. Average current depth is approximately 6 metres
("m").

-- The water balance models indicate that a five year draw down of 85 l/s
for the potential Oxide Project from the optioned water would reduce the
Laguna Verde level by approximately 1m. Consideration of smaller scale
heap leach options would have a proportionately smaller effect.

-- There is no evidence of significant variation in the electrical
conductivity of the lake's water column with depth, which suggests that
the water column is well-mixed.

Exeter has discussed a proposed on-going water monitoring and modelling program with the Chilean Water Authority, the DGA, and is submitting a Memorandum of Understanding to the DGA to work together on the potential development of this hydric resource. This co-operation is expected to assist the DGA in understanding the hydraulic characteristics of an area where they have little or no data. This approach would help ensure that Exeter follows the guidelines of the DGA and could reduce the environmental review process timeline if and when Exeter applies to extract such flows.

Separately, Exeter has scheduled a December drilling campaign (weather and access conditions permitting) at Cuenca One, its granted water exploration tenement, at an estimated cost of $1.3 million. This program could be expanded following a water discovery. This exploration program is aimed at discovering and evaluating a potential water source for both the initial heap leach stage and the following larger sulphide stage development of the Caspiche project.

Two water exploration holes were drilled earlier this year at Cuenca One. One was abandoned due to poor drilling conditions and the second was prematurely terminated at a depth of 250m in encouraging "damp gravels" due to deteriorating winter weather conditions. Major underground aquifers and reservoirs in this region are typically located at depths of some 500m.

The Company will also conduct a preliminary evaluation of a second water exploration tenement which was recently granted.

Environmental Studies:

Exeter is continuing environmental baseline studies to support the Oxide Project. Activities include:


-- Evaluating the acid rock drainage ("ARD") potential of the oxide ore and
overburden within the potential open pit limits so that potential acid
generation sources can be defined, if in fact they do exist. The
oxidised and "leached" nature of rocks associated with the Oxide Project
should minimise potential ARD issues.

-- Continued air quality monitoring and measurement of the amount of PM10,
PM2.5 and suspended dust. PM10 and PM2.5 are technical terms that relate
to respirable (breathable) particulate matter ("PM"), and the proportion
that is smaller than the indicated size measured in microns (millionths
of a metre). Equipment approved under Chilean law must be used for such
measurements.

-- Continuation of the water quality monitoring of the Caspiche basin
(which would host the potential mine and the processing facilities) and
Laguna Verde (where we have optioned surface water).

-- Finalization of the baseline study of flora, vegetation, archaeology and
fauna for an alternative access road and power line. The Company
believes such alternate access would represent a significant project
infrastructure improvement.

-- Providing project activity information and working with local
communities to understand and minimise any impact of our activities, now
and in the future, especially with respect to the investigation of sites
of cultural importance.

Jerry Perkins, 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.

http://www.exeterresource.com/pdf/2012_news/Exeter_news_121015.pdf