The facility is currently operating at 67 percent of capacity utilization and produces approximately 3,900 metric tons of bromine annually through 432 wells, which equates to $7.2 million in revenues and $1.9 million in net income at current market prices. Gulf Resources anticipates making $3.1 million in total capital expenditures, which will take approximately three months to complete from the time of commencement, and is expected to increase capacity utilization to 85 percent while increasing overall bromine production output to 4,900 metric tons annually. In addition, the Company estimates the property will yield approximately 30,000 metric tons of annual crude salt production, equating to $0.39 million in incremental revenue.

"The acquisition of Shouguang City Houxing Area is further evidence of our ability to execute and complete asset purchases at very attractive valuations,'' stated Ming Yang, CEO, Gulf Resources, Inc. With the latest two purchases, the Company is on track to produce approximately 26,700 metric tons of bromine during the coming twelve moths, a 40 percent increase from previous levels, with further room for improvements once upgrades are completed. Additionally, the Company now controls approximately 1.7 million metric tons of proven reserves, a significant asset that will enable us to produce profitable operating results well into the future.''

The asset purchase is subject to various conditions, including applicable regulatory approvals. Further details on the terms of this transaction can be found in the Company's 8-K which will be filed with the Securities and Exchange Commission.