Company: GURE
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001193805-25-000638
Chunk: 14

Company: GULF RESOURCES, INC.
Filing Date: 2025-05-13
Form: 10-Q
Item: Part I, Item 1
Chunk 14
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 prepaid land lease was amortized on a straight-line basis. As of January 1,
2019, all the leases in which term has commenced and were in use were classified as operating lease right-of-use assets (“ ROU”).
See Note 8.

In December 2017, the Company paid a one lump
sum upfront amount of $8,859,000for a 50-year lease of a parcel of land at Bohai Marine Fine Chemical Industrial Park (“ Bohai”)
for the new chemical factory under construction. There is no purchase option at the end of the lease term. This was classified as an operating
lease prior to and as of January 1, 2019. The land use certificate was issued on October 25, 2019. The lease term expires on August 12,
2069. The amount paid was recorded as prepaid land leases, net of current portion in the consolidated balance sheet as of March 31 2025
and December 31, 2024. As of March 31, 2025, the prepaid land lease increased to $9,217,790due to an additional amount paid for stamp
duty and related land use rights fees. Amortization of this prepaid land lease will commence when the chemical factory is built and placed
in service.

NOTE 6 - PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment, net consist of the following:

Property, Plant and Equipment, Net - Schedule of Property, Plant and Equipment

                                                       March 31,                        December 31,                    
  At cost:                                                                                                              
  Mineral rights                                       $                 2,686,739      $                    2,682,882  
  Buildings                                                             68,575,318                          68,476,868  
  Plant and machinery                                                  144,046,220                         143,839,420  
  Furniture, fixtures and office equipment                               1,437,153                           1,435,090  
  Motor vehicles                                                           124,394                             124,215  
  Construction in process                                               10,170,243                          10,155,642  
  Total                                                                227,040,067                         226,714,117  
  Less: Accumulated depreciation and amortization                     ( 87,944,670                        ( 83,826,560  
  Impairment                                                           ( 6,754,076                         ( 6,744,380  
  Net book value                                       $