Southgobi Announces Notice from Mongolian Governmentplenipotentiary and Designation of Company’S Mining Deposits as Mineral Deposits of Strategic Importance

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May 8, 2025

SOUTHGOBI ANNOUNCES NOTICE FROM MONGOLIAN

GOVERNMENTPLENIPOTENTIARY AND

DESIGNATION OF COMPANY’S MINING DEPOSITS AS

MINERAL DEPOSITS OF STRATEGIC IMPORTANCE

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

“Company”) announces that, on April 2, 2025, Southgobi Sands LLC (“SGS”), the Company’s

wholly-owned Mongolian subsidiary, received a letter from a plenipotentiary representative of

the Mongolian government (the “ Notice”) which invited SGS to participate in negotiations to

determine the Mongolian state’s ownership interest in SGS, being the legal entity which holds

the Company’s coal mining licenses in Mongolia.

The Notice states that, in furtherance of Mongolia’s National Wealth Fund Law which was

passed in April 2024, the Mongolian government resolved on February 5, 2025 to appoint a

plenipotentiary representati ve (the “ Plenipotentiary Representative of the Mongolian

Government”) to negotiate with legal persons holding a mining license for a deposit

designated by the Mongolian government as a strategically important deposit (“ Mineral

Deposits of Strategic Importance”) in relation to determining the proportionate interest the

Mongolian state has in such legal entity or whether to replace the Mongolian state’s interest

with a royalty interest.

The Company has been advised by its Mongolian legal co unsel that the Government of

Mongolia is empowered to participate on an equity ownership basis with the license holder in

the exploitation and/or mining of each Mineral Deposit of Strategic Importance on terms to be

negotiated between the Government of Mon golia and such license holder. Based solely on

the knowledge of the Company’s Mongolian legal counsel, the Company is aware that various

other license holders of Mineral Deposits of Strategic Importance have entered into similar

negotiations with the Plenipotentiary Representative of the Mongolian Government.

As at the date of this announcement, the deposits covered by four of the Company’s

Mongolian mining licenses have been designated as Mineral Deposits of Strategic Importance

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by Mongolian government authorities. The relevant mining licenses relate to the Company’s

Ovoot Tolgoi Mine and the Soumber Deposit.

On April 24, 2025, SGS initiated preliminary discussions with the Plenipotentiary

Representative of the Mongolian Government. The Company anticipates that the discussions

between SGS and the Plenipotentiary Representative of the Mongolian Government will

continue and both parties will endeavour to engage in good faith for the purpose of arriving at

a mutual and constructive understanding and agreement. The Company intends to fully

cooperate with the Mongolian government and provide all necessary information to the extent

permitted by applicable law.

The Company will continue to monitor developments concerning changes in the scope of the

Mineral Deposit of Strategic Importance and the consequential impact, if any, on the Company

and its business and operations , while seeking to protect its lawful interests and rights over

its mineral deposits.

The Company will issue further announcement(s) to update shar eholders and potential

investors regarding material developments as and when necessary.

Shareholders and potential investors of the Company should exercise caution when

dealing in the shares of the Company.

If there is any inconsistency or discrepancy bet ween the English and Chinese version, the

English version shall prevail.

Forward-Looking Statements

Certain information included in this press release that is not current or historical factual

information constitutes forward-looking statements or information within the meaning of

applicable securities laws (collectively, “ forward-looking statements ”), including

negotiations with the plenipotentiary representative of the Mongolian government and timing

of the meeting of the Parliament of Mongolia. Forward -looking statements are frequently

characterized by words such as “plan”, “expect”, “project”, “intend”, “believe”, “anticipate”,

"could", "should", "seek", "likely", "estimate" and other similar words or statements that certain

events or conditions “may” or “will” occur. Forward -looking statements are based on certain

factors and assumptions including, among other things, the Company’s discussions with the

plenipotentiary representative of the Mongolian government and other similar factors that may

cause actual results to differ materially from what the Company currently expects. Actual

results may vary from the forward -looking statements. Readers are cautioned not to place

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undue importance on forward -looking statements, which speaks only as of the date of this

disclosure, and not to rely upon this information as of any other date. While the Company may

elect to, it is under no obligation and does not undertake to, update or revise any forward -

looking statements, whether as a result of new information, further events or otherwise at any

particular time, except as required by law. Additional information concerning factors that may

cause actual results to materially differ from those in such forward -looking statements is

contained in the Company’s filings with Canadian securities regulatory authorities and the

website of the Hong Kong regulatory filings and disclosures of listed issuer information. These

can be found under the Company’s profile on SEDAR+ and HKEXnews respectiv ely, at

www.sedarplus.ca and www.hkexnews.hk.

About SouthGobi

SouthGobi, listed on the Hong Kong Stock Exchange and the TSX Venture Exchange , 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

Email: [email protected]

Mr. Ruibin Xu

Chief Executive Officer

Office: +1 604 762 6783 (Canada)

+852 2156 1438 (Hong Kong)

Website: www.southgobi.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is

defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy

or accuracy of this release.