Talking Coal With SouthGobi Resources' CEO

http://seekingalpha.com/article/369691-talking-coal-with-southgobi-resources-ceo

Disclosure: I am long ACI, CNX, PCX, BTU, ANR. I am a consultant for SouthGobi Resources.

The following in-depth interview was conducted by Peter Epstein with the CEO of SouthGobi Resources, Alex Molyneux. Paid subscribers to a premier coal industry newsletter published by Doyle Trading Consultants received this interview on February 10th. As the author of this content, I have been permitted by Doyle Trading Consultants to distribute this interview. Subsequent to its posting here on Seeking Alpha, this article will not appear anywhere else.
Alex Molyneux: Canadian company SouthGobi Resources (SGQRF.PK), located 45 km from the Chinese border, is 1 of just 2 dominant Mongolian coking coal exporters. We are in the 3rd or 4th inning of explosive organic volume and earnings growth. Within 3 years, SGQ will be exporting 10 mm MT of coking coal. Our cash costs, averaging in the low US$20's per MT, are among the lowest in the world. China's 12th 5-yr plan clearly focuses on building out inland Chinese provinces where we have a distinct transportation advantage.
We have 535 mm MT of coal resources, which give us a +25-year mine life and we are actively exploring for more coal. SGQ is building a paved haul road to the Chinese border that will be able to transport in excess of 20 mm MT/year. Unlike many global players, SGQ effectively has no capacity constraints. Despite minor setbacks from time to time, we have to date delivered the volume and margin growth that we advertised when we listed in Hong Kong in May 2010.

SouthGobi Makes A Logical Target For Teck Resources

http://seekingalpha.com/article/292929-southgobi-makes-a-logical-target-for-teck-resources

Coal sector M&A activity has picked up this year, with no end in sight. Rio Tinto (RIO) made a proactive acquisition when it bought an emerging coking coal player in Mozambique and it recently tendered for the 25% of shares of Australia's Coal & Allied Industries that it doesn't already own. Anglo American (AAUKF.PK) and BHP (BHP) are both reportedly looking at Walter Energy (WLT), (stock up 21% on Sept. 7th). Alpha Natural Resources (ANR) acquired Massey Energy, Arch Coal (ACI) acquired Intl. Coal. Vale and Tata Steel have great emerging coal market exposure in Mozambique. Glencore (GLCNF.PK) is stalking a south African coal producer named Optimium Coal. Peabody Energy (BTU) and Mittal (MT) are buying Macarthur coal. Peabody also won a coveted spot on Mongolia's Tavan Tologi development team. Please see my thoughts on Tavan Tolgoi here and here.

Share structure of Southgobi 2012

http://www.southgobi.com/s/ShareStructure.asp

Thu Sep 6, 2012

Authorized Unlimited Common Shares       Issued and Outstanding Common Shares 181,906,254 Options Outstanding 10,008,030 Fully Diluted 221,251,918       Major Common Shareholders Turquoise Hill Resources(direct and indirect) China Investment Corporation 104,807,155 25,539,834 Percentage 57.62% 14.04%       Cusip No. 844375204 ISIN No. CA8443751059       Shares Listed     Toronto Stock Exchange TSX: SGQ Hong Kong Stock Exchange HK: 1878

Ovoot Tolgoi Southgobi 2012

http://www.southgobi.com/s/OvootTolgoi.asp

STRATEGICALLY LOCATED - CLOSEST COAL TO CHINA
click to enlarge

MONGOLIA: THE SAUDI ARABIA OF COAL

Mongolia's vast reserves of high-quality coal, combined with its close proximity to China, the world's largest consumer of coal, and high demand Asian markets - make Mongolia a growing strategic player in the global coal market. Mongolia plays an important, expanding role in powering China's heavy industries and coal-fired generating capacity.

Southgobi Resources company description 2012

http://www.southgobi.com/s/CompanyDescription.asp

SouthGobi Resources is focused on exploration and development of its Permian-age metallurgical and thermal coal deposits in Mongolia's South Gobi Region to supply a wide range of coal products to markets in Asia.

Ovoot Tolgoi is the company's flagship coal mine development project. SouthGobi has been issued a Permit to Mine and commenced open-pit coal production in April 2008 and and is selling coal to customers in China. Ovoot Tolgoi is located in southern Mongolia, approximately 40 kilometres north of the Mongolia/China border

Corporate Directory of Southgobi

http://www.southgobi.com/s/CorporateDirectory.asp
	Corporate Head Office: SouthGobi Resources Ltd. Email: info@southgobi.com Address: Suite 615, 999 Canada Place Vancouver, BC Canada V6C 3E1 Telephone: +1-604-681-6799 Fax: +1-604-688-8391

Sean Hinton Founder of Terbish

http://www.terbish.com/team_hinton.html
Sean Hinton founded Terbish Partners in 2007 to provide strategic and investment advisory. His recent focus is on cross-border transactions and IPO’s in the energy and minerals sector in China, Mongolia and Africa, and in recent years he has advised on transactions of more than US$11 billion. He is a long-term senior advisor to Goldman Sachs (Asia) and the Rio Tinto group. Other recent roles include: Special Advisor to the CEO of SOHO China; and Chairman of China Networks Ltd. Sean has more than 22 years of experience in China and Mongolia particularly, where he first lived from 1988-1995, and subsequently served Mongolia’s Honorary Consul-General in Australia.

Senior executives of Southgobi 2012

http://www.southgobi.com/s/SeniorExecutives.asp

Ross Tromans Position: President & Chief Executive Officer Mr. Tromans joined the company in September 2012. He has over 30-years sales and marketing experience in the coal and energy sectors covering the Asian and North American markets. Most recently, he was General Manager Marketing at Rio Tinto Coal Australia where he was responsible for the development and implementation of the overall marketing strategy for thermal, coking and semi-soft coal. Previously, Mr. Tromans held senior roles at Rio Tinto including General Manager Marketing and Sales at Rio Tinto Alcan, Director New Markets and Service at Kennecott Energy and General Manager Marketing at Kaltim Prima Coal.

Directors of Southgobi 2012

http://www.southgobi.com/s/Directors.asp

Kay Priestly Position: Non-Executive Director, Chairman of the Board Kay Priestly is Chief Executive Officer of Turquoise Hill Resources. She was previously a senior executive at Rio Tinto, most recently serving as Chief Financial Officer of the company's global Copper product group. Ms. Priestly joined Rio Tinto in 2006 as Chief Financial Officer at Rio Tinto's Kennecott Utah Copper operations. Prior to Rio Tinto, she spent more than 24 years with global professional services firm Arthur Andersen, where she provided tax and consulting services to global companies in the energy and mining sectors and was a member of Andersen's global executive team. Ms. Priestly is also a director of Stone Energy Corporation.