**UNITED        STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM        40-F**

o REGISTRATION STATEMENT PURSUANT TO SECTION        12 OF THE

SECURITIES EXCHANGE ACT OF 1934

 

OR

 

x ANNUAL REPORT PURSUANT TO SECTION 13(a) OR        15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

| For the fiscal year ended December 31, 2007 | Commission File Number 001-33136 |
|---------------------------------------------|----------------------------------|

         

         

**EXETER RESOURCE CORPORATION**

(Exact        name of Registrant as specified in its charter)

 

**N/A**

(Translation of Registrant’s name into English)

 

**British Columbia**

(Province        or other jurisdiction of incorporation or organization)

 

**1400**

(Primary        Standard Industrial Classification Code Number)

 

**N/A**

(I.R.S.        Employer Identification Number)

 

**999        West Hastings Street, Suite 1260**

**Vancouver, British Columbia, Canada V6C 2W2**

**(604) 688-9592**

(Address        and telephone number of Registrant’s principal executive offices)

 

**Dorsey        & Whitney LLP**

**370 Seventeenth Street, Suite 4700        Denver, Colorado 80202        (303) 629-3400**

(Name,        address and telephone number of agent for service in the United States)

 

| Securities registered or to be registered pursuant to                        Section 12(b) of the Act. |
|--------------------------------------------------------------------------------------------------------|

 

|   | Title of each class | Name of each exchange on which registered |
|--------|---------------------|-------------------------------------------|

|   | **Common Shares** | **(no par value)** | **American Stock Exchange** |
|--------|-------------------|--------------------|-----------------------------|

 

Securities registered or to be registered pursuant to Section 12(g) of the        Act:**Not Applicable**

 

Securities for which there is a reporting obligation pursuant to Section        15(d) of the Act:**Not Applicable**

 

For        annual reports, indicate by check mark the information filed with this Form:

         

x Annual information        form      xAudited annual        financial statements

 

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Indicate        the number of outstanding shares of each of the issuer’s classes of capital or common        stock as of the close of the period covered by the annual report.

 

**As at        December 31, 2007, 41,226,487 common shares without par value were issued and        outstanding.**

 

Indicate        by check mark whether the Registrant by filing the information contained in this Form is        also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under        the Securities Exchange Act of 1934 (the “Exchange Act”). If “Yes”        is marked, indicate the filing number assigned to the Registrant in connection with such        Rule.

 

YES o            No x

 

Indicate        by check mark whether the Registrant (1) has filed all reports required to be filed by        Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter        period that the Registrant was required to file such reports) and (2) has been subject to        such filing requirements for the past 90 days.

         

YES        x          No o

 

 

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**EXPLANATORY NOTE**

 

Exeter        Resource Corporation (the        “***Company***” or the        “***Registrant***”) is a        Canadian issuer eligible to file its annual report pursuant to Section 13 of the        Securities Exchange Act of 1934, as amended (the        “***Exchange Act***”), on        Form 40-F pursuant to the multi-jurisdictional disclosure system of the Exchange Act.        The Company is a “foreign private issuer” as defined in Rule 3b-4 under        the Exchange Act. The equity securities of the Company are accordingly exempt from        Sections 14(a), 14(b), 14(c), 14(f) and 16 of the Exchange Act pursuant to        Rule 3a12-3.

 

**FORWARD-LOOKING STATEMENTS**

 

This        Annual Report on Form 40-F and the exhibits attached hereto contain “forward-looking        statements” within the meaning of the Private Securities Litigation Reform Act of        1995. Such forward looking statements concern the Company’s anticipated results and        developments in the Company’s operations in future periods, planned exploration and        development of its properties, plans related to its business and other matters that may        occur in the future. These statements relate to analyses and other information that are        based on forecasts of future results, estimates of amounts not yet determinable and        assumptions of management.

Statements concerning reserves and mineral resource estimates may also be        deemed to constitute forward-looking statements to the extent that they involve estimates        of the mineralization that will be encountered if the property is developed, and in the        case of mineral reserves, such statements reflect the conclusion based on certain        assumptions that the mineral deposit can be economically exploited. Any statements that        express or involve discussions with respect to predictions, expectations, beliefs, plans,        projections, objectives, assumptions or future events or performance (often, but not        always, using words or phrases such as “expects” or “does not        expect”, “is expected”, “anticipates” or “does not        anticipate”, “plans”, “estimates” or “intends”,        or stating that certain actions, events or results “may”, “could”,        “would”, “might” or “will” be taken, occur or be        achieved) are not statements of historical fact and may be forward-looking statements.        Forward-looking statements are subject to a variety of known and unknown risks,        uncertainties and other factors which could cause actual events or results to differ from        those expressed or implied by the forward-looking statements, including, without        limitation:

|   | **•** | risks related to our lack of revenues from operations and                        our lack of ongoing mining operations; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our lack of history in producing metals                        from our mineral exploration properties and risks relating to our ability                        to successfully establish mining operations or profitably produce precious                        metals; |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | uncertainty in our ability to fund the development of our                        mineral properties or the completion of further exploration                        programs; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to differences between U.S. and Canadian                        practices for reporting resources and reserves; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | uncertainty as to actual capital costs, operating costs,                        production and economic returns, and uncertainty that our development                        activities will result in profitable mining operations; |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our reserves and resources figures being                        estimates based on interpretations and assumptions which may result in less                        mineral production under actual conditions than is currently                        estimated; |
|--------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | changes in the market price of gold, silver, and other                        minerals which in the past has fluctuated widely and which could affect the                        profitability of our future operations and financial condition; |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

1

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|   | **•** | risks related to currency fluctuations; |
|--------|------------|-----------------------------------------|

|   | **•** | risks related to the inherently dangerous activity of                        mining, including conditions or events beyond our control; |
|--------|------------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to governmental regulations, including                        restrictions related to the Don Sixto gold project; |
|--------|------------|---------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our primary properties being located in                        Chile and Argentina, including political, economic, and regulatory                        instability; |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | uncertainty in our ability to obtain and maintain certain                        permits necessary for our current and anticipated                        operations; |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our business being subject to environmental                        laws and regulations which may increase our costs of doing business and                        restrict our operations; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to land reclamation requirements for our                        properties which may be burdensome; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------|

|   | **•** | uncertainty relating to our ability to attract and maintain                        qualified management to meet the needs of our anticipated growth and risks                        relating to our ability to manage our growth effectively; |
|--------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our mineral properties being subject to                        prior unregistered agreements, transfers, or claims and other defects in                        title; |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our history of losses, which we may                        continue to incur in the future; |
|--------|------------|--------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to increased competition that could adversely                        affect our ability to attract necessary capital funding or acquire suitable                        producing properties for mineral exploration in the future; |
|--------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | risks related to our officers and directors becoming                        associated with other natural resource companies which may give rise to                        conflicts of interests; |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | the volatility of the Company’s common share price and                        volume; and |
|--------|------------|-------------------------------------------------------------------------------------------------|

|   | **•** | tax consequences to U.S. shareholders. |
|--------|------------|----------------------------------------|

         

This        list is not exhaustive of the factors that may affect our forward-looking statements. Some        of the important risks and uncertainties that could affect forward-looking statements are        described further in the exhibits attached to this Annual Report. Should one or more of        these risks and uncertainties materialize, or should underlying assumptions prove        incorrect, actual results may vary materially from those described in the forward-looking        statements. Forward-looking statements are made based on management’s beliefs,        estimates and opinions on the date the statements are made, and the Company undertakes no        obligation to update forward-looking statements if these beliefs, estimates and opinions or        other circumstances should change. Investors are cautioned against attributing undue        certainty to forward-looking statements.

 

**NOTE        TO UNITED STATES READERS -**

**DIFFERENCES IN UNITED STATES AND CANADIAN REPORTING        PRACTICES**

 

The        Company is permitted, under multi-jurisdictional disclosure system, adopted by the United        States Securities and Exchange Commission (the        “***SEC***”), to prepare        this annual report in accordance with Canadian disclosure requirements, which differ from        those of the United States. The Company prepares its financial statements, which are filed        with this Annual Report on Form 40-F, in accordance with Canadian generally accepted        accounting practices        (“***GAAP***”), and they        are subject to Canadian auditing and auditor independence standards. They are not        comparable to financial statements of United States companies. Significant differences        between Canadian GAAP and United States GAAP are described in Note 21 of the audited        consolidated financial statements of the Company.

 

 

2

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**CURRENCY**

Unless        otherwise indicated, all dollar amounts in this Annual Report on Form 40-F are in United        States dollars. The exchange rate of Canadian dollars into United States dollars, on        December 31, 2007, based upon the noon buying rate in New York City for cable        transfers payable in Canadian dollars as certified for customs purposes by the Federal        Reserve Bank of New York, was U.S.$1.00 = CDN$0.9881.

**RESOURCE AND RESERVE ESTIMATES**

The        Company’s Annual Information Form for the fiscal year ended December 31, 2007 filed        asExhibit 99.1to this Annual Report on        Form 40-F (the “***AIF***”)        has been prepared in accordance with the requirements of the securities laws in effect in        Canada, which differ from the requirements of United States securities laws. The terms        “mineral reserve”, “proven mineral reserve” and “probable        mineral reserve” are Canadian mining terms as defined in accordance with Canadian        National Instrument 43-101 – Standards of Disclosure for Mineral Projects        (“***NI 43-101***”) and the        Canadian Institute of Mining, Metallurgy and Petroleum’ (the        “***CIM***”) -*CIM Definition Standards on Mineral Resources and Mineral        Reserves*, adopted by the CIM Council, as amended. These        definitions differ from the definitions in SEC Industry Guide 7        (“***SEC Industry Guide        7***”) under the Securities Act of 1933, as amended. Under        SEC Industry Guide 7 standards, a “final” or “bankable” feasibility        study is required to report reserves, the three-year historical average price is used in        any reserve or cash flow analysis to designate reserves and the primary environmental        analysis or report must be filed with the appropriate governmental authority.

In        addition, the terms “mineral resource”, “measured mineral        resource”, “indicated mineral resource” and “inferred mineral        resource” are defined in and required to be disclosed by NI 43-101; however, these        terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be        used in reports and registration statements filed with the SEC. Investors are cautioned not        to assume that any part or all of mineral deposits in these categories will ever be        converted into reserves. “Inferred mineral resources” have a great amount of        uncertainty as to their existence, and great uncertainty as to their economic and legal        feasibility. It cannot be assumed that all, or any part, of an inferred mineral resource        will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred        mineral resources may not form the basis of feasibility or pre-feasibility studies, except        in rare cases. Investors are cautioned not to assume that all or any part of an inferred        mineral resource exists or is economically or legally mineable. Disclosure of        “contained ounces” in a resource is permitted disclosure under Canadian        regulations; however, the SEC normally only permits issuers to report mineralization that        does not constitute “reserves” by SEC standards as in place tonnage and grade        without reference to unit measures.Accordingly, information        contained in this report and the documents incorporated by reference herein contain        descriptions of our mineral deposits that may not be comparable to similar information made        public by U.S. companies subject to the reporting and disclosure requirements under the        United States federal securities laws and the rules and regulations thereunder.

         

**ANNUAL        INFORMATION FORM, AUDITED ANNUAL FINANCIAL STATEMENTS AND**

**MANAGEMENT’S DISCUSSION AND ANALYSIS**

 

*Annual        Information Form*

The AIF        is filed asExhibit 99.1and        incorporated by reference in this Annual Report on Form 40-F.

 

 

3

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*Audited        Annual Financial Statements*

The        audited consolidated financial statements of the Company for the years ended December 31,        2007, 2006 and 2005, including the report of the independent registered public accounting        firm with respect thereto, are filed asExhibit 99.2and incorporated by reference in this Annual Report on Form 40-F. For a        reconciliation of important differences between Canadian GAAP and United States GAAP, see        Note 21 to the Company’s audited consolidated financial statements.

*Management’s Discussion and Analysis*

The        Company’s Management’s Discussion and Analysis is filed asExhibit 99.3and incorporated by reference in        this Annual Report on Form 40-F.

**DISCLOSURE CONTROLS AND PROCEDURES**

At the        end of the period covered by this Annual Report on Form 40-F, the Company carried out an        evaluation, under the supervision of and with the participation of the Company’s        management, including the Chief Executive Officer        (“***CEO***”) and Chief        Financial Officer        (“***CFO***”), of the        effectiveness of the design and operations of the Company’s disclosure controls and        procedures (as defined in Rule 13a – 15(e) and Rule 15d – 15(e) under the        Exchange Act). Based on that evaluation, the CEO and the CFO have concluded that as of the        end of the period covered by this report, the Company’s disclosure controls and        procedures were adequately designed and effective in ensuring that: (i) information        required to be disclosed by the Company in reports that it files or submits to the        Securities and Exchange Commission under the Exchange Act is recorded, processed,        summarized and reported within the time periods specified in applicable rules and forms and        (ii) material information required to be disclosed in our reports filed under the Exchange        Act is accumulated and communicated to our management, including our CEO and CFO, as        appropriate, to allow for accurate and timely decisions regarding required        disclosure.

**MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL        REPORTING**

The        Company's management is responsible for establishing and maintaining adequate internal        control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the        Exchange Act. The Company’s management has employed a framework consistent with        Exchange Act Rule 13a-15(c), to evaluate the Company’s internal control over        financial reporting described below. The Company’s internal control over financial        reporting is a process designed to provide reasonable assurance regarding the reliability        of financial reporting and the preparation and fair presentation of financial statements        for external purposes in accordance with generally accepted accounting        principals.

Because        of its inherent limitations, internal control over financial reporting may not prevent or        detect misstatements. Projections of any evaluation of effectiveness to future periods are        subject to the risk that controls may become inadequate because of changes in conditions,        or that the degree of compliance with the policies or procedures may        deteriorate.

Management conducted an evaluation of the design and operation of the        Company’s internal control over financial reporting as of December 31, 2007 based on        the criteria set forth in*Internal Control – Integrated        Framework*issued by the Committee of Sponsoring Organizations of        the Treadway Commission (“COSO”). This evaluation included review of the        documentation of controls, evaluation of the design effectiveness of controls, testing of        the operating effectiveness of controls and a conclusion on this evaluation. Based on this        evaluation, management has concluded that the Company’s internal control over        financial reporting was effective as of December 31, 2007 and no material weaknesses were        discovered.

 

4

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The        Company is required to provide an auditor’s attestation report on internal control        over financial reporting for the fiscal year ended December 31, 2007. In this report, the        Company’s independent registered auditor, PricewaterhouseCoopers LLP, must state its        opinion as to the effectiveness of the Company’s internal control over financial        reporting for the fiscal year ended December 31, 2007. PricewaterhouseCoopers LLP has        audited the Company’s financial statements included in this Annual Report on Form        40-F and has issued an attestation report on the Company’s internal control over        financial reporting. The Auditor's report on the consolidated financial statements as at        and for the year ended December 31, 2007 and on the effectiveness of the Company's internal        controls over financial reporting as at December 31, 2007 were delivered by        PricewaterhouseCoopers LLP in connection with the audited financial statements attached to        this Annual Report on Form 40-F asExhibit        99.2.

 

**CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING**

The        Company maintains a system of internal controls over financial reporting designed under the        supervision of the Company’s CEO and CFO to provide reasonable assurance regarding        the reliability of financial reporting and the preparation of financial statements for        external purposes in accordance with Canadian GAAP. However, the Company’s        management, including the CEO and CFO, does not expect that its disclosure controls and        procedures or internal controls and procedures will prevent all error and all fraud. A        control system, no matter how well conceived and operated, can provide only reasonable, not        absolute, assurances that the objectives of the control system are met. Further, the design        of a control system must reflect the fact that there are resource constraints, and the        benefits of controls must be considered relative to their costs. Because of the inherent        limitations in all control systems, no evaluation of controls can provide absolute        assurance that all control issues and instances of fraud, if any, within the Company have        been detected. These inherent limitations include the realities that judgments in        decision-making can be faulty, and that breakdowns can occur because of simple error or        mistake. Additionally, controls can be circumvented by the individual acts of some persons,        by collusion of two or more people, or by management override of the control. The design of        any system of controls also is based in part upon certain assumptions about the likelihood        of future events, and there can be no assurances that any design will succeed in achieving        its stated goals under all potential future conditions; over time, control may become        inadequate because of changes in conditions, or the degree of compliance with the policies        or procedures may deteriorate. Because of the inherent limitations in a cost-effective        control system, misstatements due to error or fraud may occur and not be        detected.

The        Company’s Board of Directors (the “***Board of        Directors***” or        “***Board***”) approves the        financial statements and ensures that management discharges its financial responsibilities.        The Board of Directors’ review is accomplished principally through the Audit        Committee, which is composed of independent non-executive directors. The Audit Committee        meets periodically with management and auditors to review financial reporting and control        matters. The Board of Directors has also appointed a compensation committee composed of        non-executive directors whose recommendations are followed with regard to executive        compensation. From time to time the Board of Directors may also form special        sub-committees, which must investigate and report to the Board of Directors on specific        topics.

 

In 2007,        the Company retained an independent third party specialist to assist in the documentation        of its internal control procedures. Following the documentation of its internal control        system and testing of those systems, during the year ended December 31, 2007, the Company        effected certain changes in internal control over financial reporting that have materially        affected, or may materially affect, the Company’s internal control over financial        reporting. The Company has (i) taken steps to improve segregation of duties and the        authorization process through the addition of accounting personnel; (ii) reviewed and        refined internal control processes; (iii) reviewed and improved general controls over        information technology; and (iv) enhanced financial control over period close        processes.

 

5

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**CORPORATE GOVERNANCE**

*Compensation Committee*

Compensation of the Company’s CEO and all other officers is        recommended to the Board of Directors for determination by the Compensation Committee. The        Company’s Compensation Committee is comprised of Louis G. Montpellier, Robert G.        Reynolds and Douglas W. Scheving. The Compensation Committee meets periodically to review        the terms and conditions of employment and remuneration of officers and directors of the        Company.

 

*Board        Nomination and Corporate Governance*

The        Board of Directors is responsible for the Company’s corporate governance policies.        Nominees for the Board of Directors are selected by a majority of our independent        directors. The Company has adopted a formal written board resolution addressing the        nomination process and such related matters as may be required under federal securities        laws.

 

**AUDIT        COMMITTEE**

 

The        Company has a separately designated standing Audit Committee established in accordance with        Section 3(a)(58)(A) of the Exchange Act. The Company’s Audit Committee is comprised        of William D. McCartney, Robert G. Reynolds and Douglas W. Scheving, all of whom, in the        opinion of the Board of Directors, are independent (as determined under Rule 10A-3 of the        Exchange Act and Rules 121 and 803A of the American Stock Exchange        (“***AMEX”***) Company        Guide) and are financially literate. The Audit Committee meets the composition requirement        set forth by AMEX Rule 803(B)(2).

 

Mr. McCartney, Chairman of the Audit Committee and a Chartered Accountant        with over 20 years experience, has a clear understanding of the accounting principles used        by the Company to prepare its financial statements; has the ability to assess the general        application of such accounting principles in connection with the accounting for estimates,        accruals and reserves; has experience preparing, auditing, analyzing or evaluating        financial statements that present a breadth and level of complexity of accounting issues        that are generally comparable to the breadth and complexity of issues that can reasonably        be expected to be raised by the Company’s financial statements, and has an        understanding of internal controls and procedures for financial reporting.

         

Mr. Reynolds is a Chartered Accountant with over 35 years experience in        commerce and practice, and with over 25 years in the mining industry, which provides him        with an understanding of the accounting principles used by the Company to prepare its        financial statements, the ability to assess the general application of such accounting        principles and analyze or evaluate financial statements, and an understanding of internal        controls and procedures for financial reporting.

         

Mr. Scheving’s industry experience in the management and        administration of publicly traded mining exploration companies provides him with an        understanding of the accounting principles used by the Company to prepare its financial        statements, the ability to assess the general application of such accounting principles and        analyze or evaluate financial statements, and an understanding of internal controls and        procedures for financial reporting.

 

The members        of the Audit Committee do not have fixed terms and are appointed and replaced from time to        time by resolution of the Board of Directors.

 

6

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The        Audit Committee meets with the CEO and the CFO of the Company and the Company’s        independent auditors to review and inquire into matters affecting financial reporting, the        system of internal accounting and financial controls, as well as audit procedures and audit        plans. The Audit Committee also recommends to the Board of Directors the auditors to be        appointed. In addition, the Committee reviews and recommends to the Board of Directors for        approval the annual financial statements, the Management Discussion and Analysis, and        undertakes other activities required by regulatory authorities.

The        full text of the Audit Committee Charter is attached as Appendix 1 to the AIF. The        Audit Committee has reviewed and reassessed the adequacy of the Company’s Audit        Committee Charter.

 

*Audit        Committee Financial Expert*

The        Company’s Board of Directors has determined that William D. McCartney is an        “audit committee financial expert” within the meaning of Item 407(d)(5) of        Regulation S-K and is financially sophisticated in accordance with AMEX Rule        803(B)(2)(iii).

The        Board of Directors has determined that the experience of the other members of the Audit        Committee, as financially literate and directors of publicly traded companies, is        sufficient to ensure compliance with requisite regulatory requirements.

**PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES PROVIDED BY**

**INDEPENDENT AUDITOR**

The        Audit Committee pre-approves all audit services to be provided to the Company by its        independent auditor. Non-audit services that are prohibited to be provided to the Company        by its independent auditors may not be pre-approved. In addition, prior to the granting of        any pre-approval, the Audit Committee must be satisfied that the performance of the        services in question will not compromise the independence of the independent        auditor.

 

**PRINCIPAL ACCOUNTING FEES AND SERVICES – INDEPENDENT        AUDITOR**

 

The        following tables show the aggregate fees billed to the Company by the Company’s        principal external auditors during each of the last two fiscal years.

 

| **PricewaterhouseCoopers LLP**(4)                         |
|-----------------------------------------------------------|
| **Financial Year Ending**

                          | **Audit Fees**(1) | **Audit-Related Fees** | **Tax Fees**(2) | **All Other Fees**(3) |
| 2007                                                      | $70,000 | Nil | Nil | $3,000 |
| 2006                                                      | Nil | Nil | Nil | Nil |

| (1) | Audit fees were paid for professional services rendered by                        the auditor for the audit of the Company’s annual consolidated                        financial statements, review of quarterly consolidated financial statements                        and services provided for statutory and regulatory filings or                        engagements. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The aggregate fees billed for tax compliance, tax advice and                        tax planning services for international operations. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The aggregate fees billed in each of the last two fiscal                        years for products and services provided by the independent registered                        accountant related to regulatory filings. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | PricewaterhouseCoopers LLP was appointed as appointed the                        Company’s auditor during 2007. |
|-----|-----------------------------------------------------------------------------------------------------------------------|

 

7

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| **MacKay LLP Chartered Accountants**(4)                   |
|-----------------------------------------------------------|
| **Financial Year Ending**

                          | **Audit Fees**(1) | **Audit-Related Fees** | **Tax Fees**(2) | **All Other Fees**(3) |
| 2007                                                      | $67,600 | Nil | $5,300 | Nil |
| 2006                                                      | $41,874 | Nil | $4,302 | Nil |

| (1) | Audit fees were paid for professional services rendered by                        the auditor for the audit of the Company’s annual consolidated                        financial statements, review of quarterly consolidated financial statements                        and services provided for statutory and regulatory filings or                        engagements. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The aggregate fees billed for tax compliance, tax advice and                        tax planning services for international operations. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The aggregate fees billed in each of the last two fiscal                        years for products and services provided by the independent registered                        accountant related to regulatory filings. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | MacKay LLP, Chartered Accountants, was the Company’s                        auditor for the year ended December 31, 2006. |
|-----|---------------------------------------------------------------------------------------------------------------------------------|

 

**OFF-BALANCE SHEET TRANSACTIONS**

 

The Company        does not have any off-balance sheet financing arrangements or relationships with        unconsolidated special purpose entities.

 

**CODE        OF ETHICS**

 

The        Board has adopted a written code of conduct for its directors, officers and employees. The        Company is committed to the highest standards of legal and ethical business conduct. This        Code of Business Conduct and Ethics (the        “***Code***”) summarizes        the legal, ethical and regulatory standards that the Company must follow and serves as a        reminder to the directors, officers and employees, of the seriousness of that commitment.        Compliance with this Code and high standards of business conduct is mandatory for every        director, officer and employee of the Company.

 

A copy        of the Code in full text is available on the Company’s website at        www.exeterresource.com. All amendments to the code, and all waivers of the code with        respect to any of the officers covered by it, will be posted on the Company’s web        site, submitted on Form 6-K and provided in print to any shareholder who requests        them.

 

During        the fiscal year ended December 31, 2007, the Company did not substantively amend, waive or        implicitly waive any provision of the Code with respect to any of the directors, executive        officers or employees subject to it.

 

**CONTRACTUAL OBLIGATIONS**

 

The        following table lists as of December 31, 2007 information with respect to the        Company’s known contractual obligations.

 

|                                                                | **Payments Due by Period**

(Figures are in Canadian Dollars) |
|---------------------------------------------------------------------|---------------------------------------------------------------|
| **Contractual Obligations**                                         | Total                                                         | Less than 1 Year | 1-3 Years | 4-5 years | More than 5 years |
| Long Term Debt Obligations

                                   | Nil                                                           | Nil | Nil | Nil | Nil |
| Capital (Finance) Lease Obligations

                          | Nil                                                           | Nil | Nil | Nil | Nil |

 

 

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| Operating Lease Obligations(1)

                                                                                                                 | $408,191     | $140,826     | $157,327     | $110,038     | Nil     |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|--------------|--------------|--------------|---------|
| Purchase Obligations

                                                                                                                           | Nil          | Nil          | Nil          | Nil          | Nil     |
| Other Long-Term Liabilities Reflected on the Company’s                        Balance Sheet Under Canadian GAAP

                          | Nil          | Nil          | Nil          | Nil          | Nil     |
| **Total**

                                                                                                                                      | **$408,191** | **$140,826** | **$157,327** | **$110,038** | **Nil** |

 

**NOTICES PURSUANT TO REGULATION BTR**

 

There were        no notices required by Rule 104 of Regulation BTR that the Company sent during the year        ended December 31, 2007 concerning any equity security subject to a blackout period under        Rule 101 of Regulation BTR.

 

**AMEX        CORPORATE GOVERNANCE**

 

The Company’s common shares are listed on AMEX. Section 110 of the        AMEX Company Guide permits AMEX to consider the laws, customs and practices of foreign        issuers in relaxing certain AMEX listing criteria, and to grant exemptions from AMEX        listing criteria based on these considerations. A company seeking relief under these        provisions is required to provide written certification from independent local counsel that        the non-complying practice is not prohibited by home country law. A description of the        significant ways in which the Company’s governance practices differ from those        followed by domestic companies pursuant to AMEX standards is as follows:

         

*Shareholder Meeting Quorum Requirement*: The        AMEX minimum quorum requirement for a shareholder meeting is one-third of the outstanding        shares of common stock. In addition, a company listed on AMEX is required to state its        quorum requirement in its bylaws. The Company’s quorum requirement is set forth in        its Articles and bylaws. A quorum for a meeting of members of the Company is two persons        who are, or who represent by proxy, shareholders who, in the aggregate, hold at least 5% of        the shares entitled to be voted at the meeting.

         

*Proxy Delivery Requirement*: AMEX requires the        solicitation of proxies and delivery of proxy statements for all shareholder meetings, and        requires that these proxies shall be solicited pursuant to a proxy statement that conforms        to SEC proxy rules. The Company is a “foreign private issuer” as defined in        Rule 3b-4 under the Exchange Act, and the equity securities of the Company are accordingly        exempt from the proxy rules set forth in Sections 14(a), 14(b), 14(c) and 14(f) of the        Exchange Act. The Company solicits proxies in accordance with applicable rules and        regulations in Canada.

         

*Shareholder Approval for Issuance of Shares:*Section 713 of the AMEX Company Guide requires shareholder approval as a        prerequisite to approval of applications to list additional shares when the additional        shares will be issued in connection with a transaction involving the sale or issuance by a        company of common stock (or securities convertible into or exercisable for common stock)        equal to 20% or more of presently outstanding stock for less than the greater of book or        market value of the stock. However, the issuance of common stock in an amount in excess of        20% of the presently outstanding stock for less than book or market value, without        shareholder approval, is not prohibited under the rules of the TSX Venture        Exchange (“***TSXV***”) and        does not constitute a default under the TSXV rules or any applicable laws in        Canada.

         

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Since        the foregoing corporate governance policies of the Company are consistent with the laws,        customs and practices in Canada, the Company has sought and received Section 110 relief        from the differing AMEX standards. In addition, the Company may from time-to-time seek        relief from AMEX corporate governance requirements on specific transactions under Section        110 of the AMEX Company Guide by providing written certification from independent local        counsel that the non-complying practice is not prohibited by our home country law, in which        case, the Company shall make the disclosure of such transactions available on the        Company’s website at www.exeterresource.com. Information contained on its website is        not part of this Annual Report on Form 40-F.

**UNDERTAKING**

The        Company undertakes to make available, in person or by telephone, representatives to respond        to inquiries made by the SEC staff, and to furnish promptly, when requested to do so by the        SEC staff, information relating to: the securities registered pursuant to Form 40-F; the        securities in relation to which the obligation to file an annual report on Form 40-F        arises; or transactions in said securities.

**CONSENT TO SERVICE OF PROCESS**

Concurrently with the filing of this Annual Report on Form 40-F, the Company        is filing an Appointment of Agent for Service of Process and Undertaking on Form F-X        with the SEC with respect to the class of securities in relation to which the obligation to        file the Form 40-F arises.

**EXHIBIT INDEX**

The        following exhibits have been filed as part of this Annual Report on Form 40-F:

         

| **EXHIBIT**            | **DESCRIPTION**                                                                                                                                                                                                                                                                                                                                                                                                       |
|------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Annual Information** |
| 99.1                   | Annual Information Form of the Company for the year ended                        December 31, 2007                                                                                                                                                                                                                                                                                                                    |
| 99.2                   | The following audited consolidated financial statements of                        the Company are exhibits to and form a part of this Report:                                                                                                                                                                                                                                                                         |
|                   | Independent Auditors’ Report of PricewaterhouseCoopers                        LLP on consolidated financial statements for the year ended December 2007                        and the adjustments to the 2006 and 2005 financial statements and Internal                        Control Over Financial Reporting for the year ended December 31,                        2007                                   |
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                   | Independent Auditors’ Report of MacKay LLP on                        consolidated balance sheets as at December 31, 2006 and December 31, 2005                        and the consolidated statements of operations, cash flows,                        shareholders’ equity and deferred exploration costs for each of the                        years in the three year period ended December 31, 2006 |
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                   | Consolidated Balance Sheet as of December 31, 2007 and                        2006                                                                                                                                                                                                                                                                                                                                    |
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                   | Consolidated Statements of Operations for the years ended                        December 31, 2007, 2006 and 2005                                                                                                                                                                                                                                                                                                |
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                   | Consolidated Statements of Cash Flows for the years ended                        December 31, 2007, 2006 and 2005                                                                                                                                                                                                                                                                                                     |

 

 

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|               | Consolidated Statement of Shareholders’ Equity for the                        years ended December 31, 2007, 2006 and 2005                                                              |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                    |                                                                                                                                                                                               |
|               | Notes to Consolidated Financial Statements                                                                                                                                                    |
|                    |                                                                                                                                                                                               |
| 99.3               | Management Discussion and Analysis for the year ended                        December 31, 2007                                                                                                |
| **Certifications** |
| 99.4               | Certificate of Chief Executive Officer Pursuant to Rule                        13a-14(a) of the Exchange Act                                                                                  |
| 99.5               | Certificate of Chief Financial Officer Pursuant to Rule                        13a-14(a) of the Exchange Act                                                                                  |
| 99.6               | Certificate of Chief Executive Officer Pursuant to 18 U.S.C.                        Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                        of 2002 |
| 99.7               | Certificate of Chief Financial Officer Pursuant to 18 U.S.C.                        Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act                        of 2002 |
| **Consents**       |
| 99.8               | Consent of PricewaterhouseCoopers LLP                                                                                                                                                         |
| 99.9               | Consent of MacKay LLP, Chartered Accountants                                                                                                                                                  |
| 99.10              | Consent of Arnold van der Heyden                                                                                                                                                              |
| 99.11              | Consent of William Yeo                                                                                                                                                                        |
| 99.12              | Consent of Jerry Perkins                                                                                                                                                                      |
| 99.13              | Consent of Matthew T. Williams                                                                                                                                                                |
| 99.14              | Consent of Jason Beckton                                                                                                                                                                      |
|                    |                                                                                                                                                                                               |  |

 

 

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**SIGNATURES**

 

Pursuant        to the requirements of the Exchange Act, the Registrant certifies that it meets all of the        requirements for filing on Form 40-F and has duly caused this annual report to be signed on        its behalf by the undersigned, thereto duly authorized.

 

EXETER        RESOURCE CORPORATION

 

| By:/s/ Bryce G.                        Roxburgh |
|-------------------------------------------------|

|   | Bryce G. Roxburgh |
|--------|-------------------|

|   | Chief Executive Officer |
|--------|-------------------------|

|   | (Principal Executive Officer) |
|--------|-------------------------------|

 

Date: March        31, 2008

 

 

 

 

 

 

 

 

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