SouthGobi Resources Limited
HKSE : 1878

SouthGobi Resources Limited

March 25, 2015 08:40 ET

Appeal Court of Mongolia Upholds Verdict Against SouthGobi. SouthGobi Firmly Rejects the Decision by the Court and Will Continue to Defend Itself

HONG KONG, CHINA--(Marketwired - March 25, 2015) - SouthGobi Resources Ltd. (TSX:SGQ) (HKSE:1878) ("SouthGobi" or the "Company") announced on March 22, 2015, that the court hearing for the Company's appeal against the verdict issued by the Second District Criminal Court of Justice ("Initial Verdict") had been set for March 25, 2015.

The hearing took place on March 25, 2015 at the 10th Appeal Court for Criminal Case of Mongolia and the panel of three appointed judges decided to uphold the Initial Verdict and dismissed the appeal by the Company. The Company is awaiting at present a written version of the Appeal Court's verdict ("Appeal Verdict").

The Company firmly rejects the Appeal Verdict. The Company provided a detailed and methodical rebuttal on the merits of the case addressing each accusation, while also vigorously presenting to the panel of judges the grave procedural errors admitted by the Second District Criminal Court during the trial. To the Company's deepest regret, the Court of Appeal decided to ignore its arguments altogether and uphold the Initial Verdict in its entirety. It was further disappointing that the panel of judges from the Appeal Court has not provided any explanation whatsoever on the reasoning to uphold the Initial Verdict.

The Company views that the Initial Verdict and subsequently the Appeal Verdict are reached on the basis of the same erroneous and false reports and it has been demonstrated that there is a complete lack of evidence to support both verdicts.

The Company reiterates that it has not committed tax evasion and is resolute in continuing to defend itself through all available legal means including an appeal.

About SouthGobi

SouthGobi, listed on the Toronto and Hong Kong stock exchanges, is focused on exploration and development of its metallurgical and thermal coal deposits in Mongolia's South Gobi Region. It has a 100% shareholding in SouthGobi Sands LLC, Mongolian registered company that holds the mining and exploration licences in Mongolia and operates the flagship Ovoot Tolgoi coal mine. Ovoot Tolgoi produces and sells coal to customers in China.

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