SouthGobi announces full settlement of Tax Verdict in Mongolia

February 15, 2018

SouthGobi announces full settlement of Tax Verdict in Mongolia

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

“Company”) is pleased to announce that SouthGobi Sands LLC (“ SGS”), the Company’s

subsidiary in Mongolia, has completely fulfilled its obligations under the previously disclosed

judgment of the Mongolian Second District Criminal Court (the “Tax Verdict”) rendered against

SGS in January 2015.

SGS has been informed by the Court Decision Implementation Agency of Capital City in

Mongolia that the enforcement procedure in relation to the Tax Verdict has been terminated and

no party shall have any right to make any further claims in connection with the Tax Verdict. For

details relating to the background of the Tax Verdict , please refer to the Company’s

Management’s Discussion and Analysis for the quarter ended September 30, 2017 and, in

particular, the section under the heading entitled “Governmental and Regulatory Investigations”,

which is available under the Company’s profile on the SEDAR website at www.sedar.com and

on the website of the Hong Kong Stock Exchange at www.hkexnews.hk.

SGS and the Company will continue to comply with the laws of Mongolia and to contribute to

Mongolia’s society, economy, and environment as a whole.

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 Mongolia. SouthGobi produces

and sells coal to customers in China.

Contact:

Investor Relations

Kino Fu

Office: +852 2156 7030

Email: [email protected]

Website: www.southgobi.com