SouthGobi Announces Agreement With CIC for Deferral of Interest Payments

HONG KONG, CHINA–(Marketwired – May 30, 2016) – SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) (the “Company” or “SouthGobi”) announces the execution of a deferral agreement with China Investment Corporation (“CIC”) for deferral of the sum of approximately U.S.$18.7 million, representing current and deferred cash interest obligations and associated costs payable to CIC, to June 17, 2016. As consideration for the deferral, the Company agrees to pay CIC a deferral fee at a rate of 6.4% per annum on the deferred payments.
While the Company believe it will be able to reach a new repayment plan with CIC by June 17, 2016, there is no assurance that the repayment plan will be favorable to the Company.
About SouthGobi
SouthGobi, listed on the Toronto and Hong Kong stock exchanges, owns and operates its flagship Ovoot Tolgoi coal mine in Mongolia. It also holds the mining and exploration licences of its other metallurgical and thermal coal deposits in South Gobi Region of Mongolia. SouthGobi produces and sells coal to customers in China.