SouthGobi Updates on Mongolia Tax Audit Outcome

SouthGobi Resources Ltd. has provided an update on the ongoing tax audit involving its subsidiary, Southgobi Sands LLC, in Mongolia. As per the resolution from the Tax Dispute Resolution Council on January 10, 2025, the tax penalty initially assessed at approximately US$80 million has been reduced to US$26.5 million.

SouthGobi's management is presently evaluating the resolution with an independent tax consultant in Mongolia to decide if an appeal will be pursued. Under Mongolian law, there is a 30-day window for filing an appeal with the Administrative Court.

The company stresses that this revised assessment does not impact its financial statements until the appeal process is finalized. Shareholders and investors are cautioned to handle the company's shares prudently until further updates are provided.