HONG KONG, CHINA--(Marketwired - Aug. 22, 2013) - SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) ("SouthGobi" or "Company") today announced the receipt of three pre-mining agreements ("PMAs") in Mongolia.
- The Mineral Resources Authority of Mongolia ("MRAM") has granted SouthGobi three PMAs. The PMAs relate to the Zag Suuj Deposit and certain areas associated with the Soumber Deposit;
- The PMAs will enable SouthGobi to progress to the mining license application process;
- SouthGobi has withdrawn the Notice of Investment Dispute in recognition of the fact that the grant of these three PMAs, together with the PMA previously granted on January 18, 2013, resolves the key aspect of that dispute; and
- The granting of the PMAs is an important step for SouthGobi, and signals its improving relationship with key stakeholders in Mongolia.
Three PMAs have been approved and signed by the Company's wholly-owned Mongolian subsidiary, SouthGobi Sands LLC, and MRAM effective August 14, 2013. The PMAs relate to three mineral exploration licenses held by SouthGobi Sands LLC, being Licenses 9449X, 5267X and 13779X. The three PMAs were issued by MRAM following due process by the Mongolian authorities in accordance with the Minerals Law of Mongolia and other applicable laws and regulations.
License 9449X relates to certain areas associated with the Soumber Deposit outside the existing mining license and the PMA previously granted on January 18, 2013. Licenses 5267X and 13779X relate to the Zag Suuj Deposit. The PMAs will enable SouthGobi to progress to the mining license application process.
The three PMAs, together with the PMA previously granted on January 18, 2013, were the subject of applications originally made in 2011. On July 11, 2012, SouthGobi announced that SGQ Coal Investment Pte. Ltd., a wholly-owned subsidiary of SouthGobi Resources Ltd. that owns 100% of SouthGobi Sands LLC, filed a Notice of Investment Dispute on the Government of Mongolia pursuant to the Bilateral Investment Treaty between Singapore and Mongolia. SouthGobi is pleased that the grant of the three PMAs, together with the PMA previously granted on January 18, 2013, has now been achieved without the need to commence arbitration or conciliation pursuant to the Notice of Investment Dispute. Accordingly, SouthGobi has withdrawn the Notice of Investment Dispute in recognition that this dispute has been resolved to the benefit of all key stakeholders.
SouthGobi is listed on the Toronto and Hong Kong stock exchanges, in which 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, the Mongolian registered company that holds the mining and exploration licenses in Mongolia and operates the flagship Ovoot Tolgoi coal mine. Ovoot Tolgoi produces and sells coal to customers in China.