Source: SouthGobi Resources                    Date: 08 December, 2010

Mr. Alexander Molyneux, President and CEO of SouthGobi Resources Ltd., has announced that the company has signed a strategic alliance agreement with Winsway Coking Coal Holdings Ltd. and a contract for the sale of 3.2 million tons of coal in 2011. Under the agreement, SouthGobi commits to sell at least two million tons of coal to Winsway per year. Winsway will work with SouthGobi to increase the market value of SouthGobi's Mongolian coal and will provide priority access to its logistics assets. The agreement has a five-year term. Any specific future coal sales will be subject to mutual agreement on terms, including pricing.

The companies also signed a contract for Winsway to purchase 3.2 million tons of coal in 2011. Pricing for the coal to be sold under this contract has been agreed to for the first quarter of 2011, and will be determined by mutual agreement in advance of each subsequent quarter. Coal volumes for delivery will be divided evenly at 800,000 tons per quarter.

"The 2011 sales contract with Winsway represents the largest single coal-sales contract in SouthGobi's history and demonstrates fulfillment of key objectives in SouthGobi's growth strategy," said Mr. Molyneux. "The strategic alliance agreement also will increase volumes of SouthGobi's coal sales and add value over time, building on of Winsway's demonstrated capability to deliver Mongolian coal to consumers in China."