SouthGobi Resources Updates on Mongolia Tax Audit Outcome

SouthGobi Resources Ltd. has announced a significant update regarding its tax audit in Mongolia. The Tax Dispute Resolution Council (TDRC) has reduced the tax penalty against Southgobi Sands LLC (SGS), a wholly-owned subsidiary, from approximately US$80.0 million to US$26.5 million. This reduction was formalized in a resolution dated January 10, 2025.

After considering advice from its independent tax consultant in Mongolia, SouthGobi decided not to appeal the revised assessment. This decision will impact the company's financial statements for the fiscal year ending December 31, 2024. Shareholders and potential investors are advised to exercise caution when dealing with the company’s shares.