Gulf Resources Signs Long Term Supply Agreement with Huaneng Yimin Power Plant

Published May 07th, 2007

LOS ANGELES and SHENZHEN, China, May 7 /Xinhua-PRNewswire-FirstCall/ -- Gulf Resources, Inc. (the "Company") (OTC Bulleton Board: GUFR), a leading provider of chemical products used in oil and gas field explorations, oil and gas distribution, and oil field drilling announced today that its wholly-owned subsidiary, Shouguang Yuxin Chemical Industry Company Limited ("SYCI"), signed a long-term cooperative agreement with the Huaneng Yimin Power Plant, a division of Huaneng Yimin Coal & Electricity Co. Ltd. ("HYCEC") to become its exclusive supplier of biocide. Gulf Resources expects this agreement to contribute $1.1 million in product sales and a net profit of $150,000 during 2007.
 

"HYCEC" is a conglomerate and one of 52 National Key Projects, which has several subsidiaries comprising of power plants and open-pit mine production units, including the Yimin Coal Field.
 

Generic biocide chemical products generally used with power generation equipment and pipelines tend to accumulate highly toxic substances and typically have an effective life span of two to three days. SYCI's research and development efforts have enabled the Company to develop an efficient, broad-spectrum of multi-purpose, non-toxic, environmentally friendly biocide which carries a bactericidal rate of 98 percent and maintains an effective life span of six to eight days. Management estimates this process will yield a twelve percent production cost savings compared to traditional biocide.
 

SYCI was able to secure this exclusive supply contract through a successful bidding process. The company's superior proprietary technology and its quality after-sales customer service were cited as the reasons for being awarded the business with "HYCEC". The Company anticipates revenues from this agreement will grow at least twenty percent per year for the foreseeable future.

 

Mr. Ming Yang, CEO of Gulf Resources, commented, "We are very pleased to formalize this exclusive supply agreement with Huaneng Yimin Coal and Electricity Co. Ltd. This relationship offers another avenue for growth by providing a conduit to the large, established power generation chemicals market. We believe this relationship serves as a testament to our innovative research and development capabilities, in addition to the quality customer service we provide."