Change of Auditor VANCOUVER – SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) (“SouthGobi” or the “Company”) announces that PricewaterhouseCoopers LLP (“PwC Canada”) has resigned as the auditor of the Company (the “ Auditor”) with effect from

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November 13, 2019

Change of Auditor

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

“Company”) announces that PricewaterhouseCoopers LLP (“PwC Canada”) has resigned as

the auditor of the Company (the “ Auditor”) with effect from November 13, 2019, due to the

new requirement of the recognition of overseas auditors under the Hong Kong’s Financial

Reporting Council Ordinance (Chapter 588 of the Laws of Hong K ong) (the “ FRCO”). The

board of directors of the Company (the “ Board”), with the recommendation from the audit

committee of the Board (the “Audit Committee”), has appointed BDO Limited (“BDO”) as the

new Auditor with effect from November 13, 2019 to fill the casual vacancy created by the

resignation of PwC Canada and to hold office until the conclusion of the next annual general

meeting of the Company.

Pursuant to the legislation amendments to the FRCO which became effective on October 1,

2019, all non -Hong Kong auditors intending to carry out a public interest entity audit

engagement of a company listed on the Hong Kong Stock Exchange are required to be

recognized by the Financial Reporting Council (“ FRC”), Hong Kong’s independe nt regulator

of listed company auditors. The Company received notification from PwC Canada confirming

that it did not intend to apply for recognition by the FRC and therefore w ould not be able to

perform an audit for the Company’s financial year ending Dec ember 31, 2019. As a result,

PwC Canada resigned as Auditor of the Company effective as of November 13, 2019.

Pursuant to the applicable Canadian securities laws, PwC Canada has confirmed to the

Company that there are no “reportable events” (as such term is defined in National Instrument

51-102 – Continuous Disclosure Obligations (“ NI 51-102”)) in connection with the change of

Auditor disclosed in this press release. In accordance with NI 51-102, the notice of change of

auditor, together with the required letters from PwC Canada and BDO, have been reviewed

and approved by the Board and filed under the Company’s profile on SEDAR at

www.sedar.com.

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SouthGobi is a company that exists under and is governed by the laws of the Province of

British Columbia (Canada). To the knowledge of the Board, there is no requirement under the

laws of the Province of British Columbia (Canada) for the resigning auditor to confirm to the

Company whether or not there is any circumstance connected with their resignation which

they c onsider should be brought to the attention of the Company’s security holders. PwC

Canada has therefore not issued such confirmation. The Board and the Audit Committee

confirm that (i) there are no disagreements between the Company and PwC Canada; and that

(ii) there are no other matters or circumstances in connection with the change of Auditor that

need to be brought to the attention of the shareholders of the Company.

The Board would like to express its sincere gratitude to PwC Canada for the professional and

quality services rendered to the Company in the past years. The Board also wishes to extend

its warm welcome to BDO on its appointment as the Auditor; and believes that the change of

Auditor will not have any impact on completing the audit for the Company’s financial year

ending December 31, 2019.

If there is any inconsistency or discrepancy between the English version and the Chinese

version, the English version shall prevail.

About SouthGobi

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

flagship Ovoot Tolgoi coal mine in Mongolia. It also holds the mining licences of its other

metallurgical and thermal coal deposits in South Gobi Region of Mon golia. 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