Gulf Resources Announces Temporary Suspension of Production at its First Natural Gas Well in Sichuan

Published Aug 13th, 2017

SHOUGUANG, China, July 10, 2017 (GLOBE NEWSWIRE) -- Gulf Resources, Inc. (Nasdaq:GURE) ("Gulf Resources" or the "Company"), a leading manufacturer of bromine, crude salt, and specialty chemical products, today announces the temporary suspension of production at its first natural gas well in Sichuan Province.

In the initial stages of production, the content of the natural gas did not meet the expected quality standards. The basic issue is that the water content in the natural gas is too high, which is a common problem in natural gas wells. From the outset, the Company was aware that this type of problem could occur, which is why it was only producing test quantities of natural gas.

Gulf Resources currently is consulting with the professional petroleum experts from Southwest Petroleum University to assess the issue and make recommendations.  At the present time, the Company believes the solution will likely involve the addition of relatively inexpensive pieces of equipment, which should take a few months to procure and install. However, until the full plan from the Southwest Petroleum University team is received, the Company cannot be completely certain of the cost or the timing.

While this is a short-term set back, the Company believes this will not change the intermediate to long-term opportunities for natural gas production in Sichuan Province.

Gulf Resources continues to be optimistic about both its core business and the opportunities in Sichuan Province. At the present time, Gulf expects to report strong results in bromine and improved results in chemicals for the second quarter of 2017. Overall, excluding potential extraordinary items and currency exchange problem, the Company expects to report that sales in the second quarter of 2017 increased over those in the previous year. It also expects to report that earnings and earnings per share increased by double digits.

Liu Xiaobin, the President and CEO of Gulf Resources stated, “We are moving very carefully to insure that our Sichuan project produces natural gas of the highest quality. We believe we have a great opportunity and do not want to jeopardize it by taking any shortcuts. Meanwhile, we are very pleased that our chemical business has improved and our bromine business remains very strong. We look forward to reporting strong results for the second quarter and for the remainder of the year.”

About Gulf Resources, Inc.
Gulf Resources, Inc. operates through four wholly-owned subsidiaries, Shouguang City Haoyuan Chemical Company Limited ("SCHC"), Shouguang Yuxin Chemical Industry Co., Limited ("SYCI"), Shouguang City Rongyuan Chemical Co, Limited (“ SCRC”) and Daying County Haoyuan Chemical Company Limited (“DCHC”). The company believes that it is one of the largest producers of bromine in China. Elemental Bromine is used to manufacture a wide variety of compounds utilized in industry and agriculture. Through SYCI, the company manufactures chemical products utilized in a variety of applications, including oil and gas field explorations and papermaking chemical agents. SCRC is a leading manufacturer of materials for human and animal antibiotics in China and other parts of Asia. DCHC was established to further explore and develop natural gas and brine resources (including bromine and crude salt) in China. For more information, visit www.gulfresourcesinc.com.

Forward-Looking Statements

Certain statements in this news release contain forward-looking information about Gulf Resources and its subsidiaries business and products within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. The actual results may differ materially depending on a number of risk factors including, but not limited to, the general economic and business conditions in the PRC, future product development and production capabilities, shipments to end customers, market acceptance of new and existing products, additional competition from existing and new competitors for bromine and other oilfield and power production chemicals, changes in technology, the ability to make future bromine asset purchases, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in the company's reports filed with the Securities and Exchange Commission. Gulf Resources undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

CONTACT: Gulf Resources, Inc.
Web: http://www.gulfresourcesinc.com

Director of Investor Relations
Helen Xu (Haiyan Xu)
beishengrong@vip.163.com