SGQ SouthGobi Resources Ltd

Peter Meredith, Chief Executive Officer of SouthGobi Energy Resources Ltd. (TSX VENTURE: SGQ), announced today that the company has sold, subject to regulatory approval, its Metals Division to Ivanhoe Mines Ltd. for US$3 million. The Metals Division consists of certain base and precious metals properties in Mongolia and Indonesia. The transaction will enable SouthGobi Energy Resources to focus solely on its principal business of coal production, development and exploration.

In connection with the sale agreement, the company has established a credit facility with Ivanhoe Mines Ltd., which allows SouthGobi to obtain advances from Ivanhoe to an aggregate maximum of US$30 million. The credit facility is for a one year term with a one year discretionary extension. The credit facility is unsecured and carries an interest rate equal to LIBOR plus 7.5 basis points.

SouthGobi commissioned an independent valuation report from Stephen Semeniuk, CFA, and engaged Pierre Lebel, Lead Independent Director, to negotiate the sale of the Metals Division to Ivanhoe Mines.

"We believe the sale of the Metals Division represents excellent value to SouthGobi shareholders and positions SouthGobi to continue its evolution as a stand-alone coal mining company," said Mr. Meredith.

The transaction is subject to all necessary regulatory approvals, including approval of the TSX Venture Exchange.

About SouthGobi Energy Resources

SouthGobi Energy Resources is focused on exploration and development of its Permian-age metallurgical and thermal coal deposits in Mongolia's South Gobi Region and its Eocene-age metallurgical and thermal coal deposits in East Kalimantan, Indonesia. The company's flag-ship coal mine, Ovoot Tolgoi, is in production and selling coal to customers in China. The company plans to supply a wide range of coal products and electricity to markets in Asia. The company also is investigating the implementation of clean-coal technologies in the development of coal power-generating capacity to benefit all of its stakeholders.

Forward-Looking Statements: This document includes forward-looking statements. Forward-looking statements include, but are not limited to, the company's future ability to supply coal products and electricity to markets in Asia, and other statements that are not historical facts. When used in this document, the words such as "could", "plan", "estimate", "expect", "intend", "may", "potential", "should", and similar expressions are forward-looking statements. Although SouthGobi Energy Resources believe that the expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed under the heading "Risk Factors" in SouthGobi Energy's Management's Discussion and Analysis of Financial Condition and Results of Operations for the nine months ended September 30, 2008, and its Annual Information Form dated March 28, 2008 which is available at www.sedar.com.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contacts: SouthGobi Energy Resources Ltd. Steven Feldman Investors (604) 681-6799 SouthGobi Energy Resources Ltd. Bob Williamson Media (604) 681-6799 Website: www.southgobi.com