SouthGobi Resources Limited
HKSE : 1878

SouthGobi Resources Limited

November 25, 2013 05:12 ET

SouthGobi Resources Provides First Bi-Weekly Update on Restated Financials

HONG KONG, CHINA--(Marketwired - Nov. 25, 2013) - SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) (the "Company"). Reference is made to the announcements of the Company dated November 8, 2013, November 11, 2013 and November 14, 2013 ("the Announcements") in relation to the decision by the Company board of directors to restate the Company financial statements for 2011 and 2012 (collectively, the "Restated Financials").

The Company has voluntarily decided to provide bi-weekly updates in respect of the Restated Financials in accordance with the Alternative Information Guidelines under National Policy 12-203. The Chief Financial Officer of the Company has authorised this update.

The Company advises that since the Announcements there have not been any material changes to the information contained therein. The Company continues to work expeditiously with PricewaterhouseCoopers LLP, the Company's current auditors, and Deloitte LLP, the Company's auditors during the 2010 and 2011 fiscal years, to complete the Restated Financials as soon as possible. The Restated Financials are expected to be available on or before December 13, 2013.

The Company reports that there has not been any failure by the Company to fulfill its intentions as stated in the Announcements, and there are no defaults. Further, there is no additional information in respect of the Company and its affairs that has not been generally disclosed as of the date of this update.

The Company's Management has been enhancing internal controls over financial reporting by developing a more thorough review process in evaluating complex sales arrangements in each reporting period. The remedial controls that have now been implemented must operate for a sufficient period of time before management can conclude, through testing, that these controls are effective and therefore that the material weakness identified and referred to in the Company's Third Quarter 2013 Financial and Operating Results can be considered remediated. Management expects this to be achieved by December 31, 2013.

Until the Restated Financials have been filed, the Company intends to continue to issue bi-weekly updates in accordance with the Alternative Information Guidelines, which will also be filed on SEDAR. The Company will file its next bi-weekly update on or around December 9, 2013.

About SouthGobi

SouthGobi is listed on the Toronto and Hong Kong stock exchanges, in which Turquoise Hill Resources Ltd. ("Turquoise Hill"), also publicly listed in Toronto and New York, has a 58% shareholding. Turquoise Hill took management control of SouthGobi in September 2012 and made changes to the board and senior management. Rio Tinto has a majority shareholding in Turquoise Hill.

SouthGobi 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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