Business Update

1

March 3, 2020

Business Update

VANCOUVER – SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) (“SouthGobi” or the

“Company”) announces the following updates:

Reference is made to the announcement dated February 19, 2020 related to the closure of

Mongolia’s southern border crossings with China from February 11, 2020 . The Company

learns that the Mongolian State Emergency Commission has decided to open the border

crossings and resume the coal exports to China from March 15, 2020. In order to preserve its

working capital, the Company will continue to reduce production. The Company anticipates

that its existing coal inventories are sufficient to satisfy expected sales demand for a period of

at least 2 months following the resumption of coal exports to China.

The Company will continue to closely monitor the status of the border closures and will make

further announcement(s) in due course as and when appropriate.

About SouthGobi

SouthGobi, listed on the Toronto and Hong Kong stock exchanges, owns and operates its

flagship Ovoot Tolgoi coal mine in Mongolia. SouthGobi produces and sells coal to customers

in China.

Contact:

Investor Relations

Kino Fu

Office: +852 2156 7030 (Hong Kong)

+1 604 762 6783 (Canada)

Email: [email protected]

Website: www.southgobi.com