Gulf Resources (GURE) 10-Q 14 Nov 19 2019 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 09, 2019
Document And Entity Information
Entity Registrant Name	GULF RESOURCES, INC.
Entity Central Index Key	0000885462
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		47,583,072
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2019

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Current Assets
Cash	$ 105,218,569	$ 178,998,935
Accounts receivable	9,673,967	0
Inventories, net	680,650	0
Prepayments and deposits	1,375,450	8,096,636
Prepaid land leases	175,550	235,459
Other receivable	559	12,506
Total Current Assets	117,124,745	187,343,536
Non-Current Assets
Property, plant and equipment, net	139,548,193	82,282,630
Finance lease right-of use assets	178,381	250,757
Operating lease right-of-use assets	8,817,327	0
Prepaid land leases, net of current portion	8,818,657	9,639,009
Deferred tax assets	13,459,527	19,030,858
Total non-current assets	170,822,085	111,203,254
Total Assets	287,946,830	298,546,790
Current Liabilities
Payable and accrued expenses	3,870,516	905,258
Retention payable	3,753,447	332,416
Taxes payable-current	4,020,792	1,188,687
Finance lease liability, current portion	162,132	197,480
Operating lease liabilities, current portion	406,156	0
Total Current Liabilities	12,213,043	2,623,841
Non-Current Liabilities
Finance lease liability, net of current portion	1,879,713	2,069,545
Operating lease liabilities, net of current portion	7,731,385	0
Total Non-Current Liabilities	9,611,098	2,069,545
Total Liabilities	21,824,141	4,693,386
Stockholders Equity
PREFERRED STOCK; $0.001 par value; 1,000,000 shares authorized; none outstanding	0	0
COMMON STOCK; $0.0005 par value; 80,000,000 shares authorized; 47,812,221 and 47,052,940 shares issued; and 47,583,072 and 46,803,791 shares outstanding as of September 30, 2019 and December 31, 2018	23,904	23,525
Treasury stock; 229,149 and 249,149 shares as of September 30, 2019 and December 31, 2018 at cost	(510,329)	(554,870)
Additional paid-in capital	95,043,388	95,020,808
Retained earnings unappropriated	166,937,574	185,608,445
Retained earnings appropriated	24,233,544	24,233,544
Accumulated other comprehensive loss	(19,605,392)	(10,478,048)
Total Stockholders' Equity	266,122,689	293,853,404
Total Liabilities and Stockholders' Equity	$ 287,946,830	$ 298,546,790

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
PREFERRED STOCK, par or stated value per share	$ 0.001	$ 0.001
PREFERRED STOCK, shares authorized	1,000,000	1,000,000
PREFERRED STOCK, shares outstanding	0	0
COMMON STOCK, par value per share	$ 0.0005	$ 0.0005
COMMON STOCK, shares authorized	80,000,000	80,000,000
COMMON STOCK, shares issued	47,812,221	47,052,940
COMMON STOCK, shares outstanding	47,583,072	46,803,791
Treasury stock, shares	229,149	249,149

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
NET REVENUE
Net revenue	$ 4,548,542	$ 343,080	$ 10,596,521	$ 2,594,941
OPERATING INCOME (EXPENSE)
Cost of net revenue	(2,403,532)	(68,456)	(5,430,269)	(1,310,272)
Sales, marketing and other operating expenses	(5,821)	(10,112)	(12,434)	(66,111)
Write-off/Impairment on property, plant and equipment	0	(1,397,313)	0	(1,397,313)
Loss on demolition of factory	0	(18,644,473)	0	(18,644,473)
Direct labor and factory overheads incurred during plant shutdown	(3,485,383)	(5,563,494)	(10,653,690)	(16,948,499)
General and administrative expenses	(5,020,215)	(1,323,933)	(8,460,733)	(6,021,561)
Other operating income (loss)	0	(134,216)	0	(134,216)
Total Costs and Expenses	(10,914,951)	(27,141,997)	(24,557,126)	(44,522,445)
LOSS FROM OPERATIONS	(6,366,409)	(26,798,917)	(13,960,605)	(41,927,504)
OTHER INCOME (EXPENSE)
Interest expense	(34,310)	(37,220)	(111,530)	(123,749)
Interest income	101,130	161,582	369,582	509,738
LOSS BEFORE TAXES	(6,299,589)	(26,674,555)	(13,702,553)	(41,541,515)
INCOME TAX (EXPENSE) BENEFIT	(6,729,439)	7,181,521	(4,968,318)	10,258,508
NET LOSS	(13,029,028)	(19,493,034)	(18,670,871)	(31,283,007)
COMPREHENSIVE LOSS:
NET LOSS	(13,029,028)	(19,493,034)	(18,670,871)	(31,283,007)
OTHER COMPREHENSIVE LOSS
Foreign currency translation adjustments	(8,690,103)	(14,738,766)	(9,127,344)	(19,376,831)
COMPREHENSIVE LOSS	$ (21,719,131)	$ (34,231,800)	$ (27,798,215)	$ (50,659,838)
LOSS PER SHARE:
BASIC AND DILUTED	$ (.27)	$ (0.42)	$ (.40)	$ (0.67)
WEIGHTED AVERAGE NUMBER OF SHARES:
BASIC AND DILUTED	47,583,072	46,803,791	47,241,854	46,803,791

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (Unaudited) - USD ($)	Common Stock	Treasury Stock	Additional Paid-In Capital	Retained Earnings	Retained earnings appropriated	Accumulated Other Comprehensive Income (Loss)	Total
Shares issued at Dec. 31, 2017	47,052,940
Balance, shares at Dec. 31, 2017	46,803,791	249,149
Balance, amount at Dec. 31, 2017	$ 23,525	$ (554,870)	$ 94,524,608	$ 255,572,431	$ 24,233,544	$ 8,162,958	$ 381,962,196
Translation adjustment						(19,376,831)	(19,376,831)
Net loss				(31,283,007)			(31,283,007)
Shares issued at Sep. 30, 2018	47,052,940
Balance, shares at Sep. 30, 2018	46,803,791	249,149
Balance, amount at Sep. 30, 2018	$ 23,525	$ (554,870)	94,524,608	224,289,424	24,233,544	(11,213,873)	331,302,358
Shares issued at Jun. 30, 2018	47,052,940
Balance, shares at Jun. 30, 2018	46,803,791	249,149
Balance, amount at Jun. 30, 2018	$ 23,525	$ (554,870)	94,524,608	243,782,458	24,233,544	3,524,893	365,534,158
Translation adjustment						(14,738,766)	(14,738,766)
Net loss				(19,493,034)			(19,493,034)
Shares issued at Sep. 30, 2018	47,052,940
Balance, shares at Sep. 30, 2018	46,803,791	249,149
Balance, amount at Sep. 30, 2018	$ 23,525	$ (554,870)	94,524,608	224,289,424	24,233,544	(11,213,873)	331,302,358
Shares issued at Dec. 31, 2018	47,052,940
Balance, shares at Dec. 31, 2018	46,803,791	249,149
Balance, amount at Dec. 31, 2018	$ 23,525	$ (554,870)	95,020,808	185,608,445	24,233,544	(10,478,048)	293,853,404
Translation adjustment						(9,127,344)	(9,127,344)
Common stock issued for services, shares	20,000	(20,000)
Common stock issued for services, amount		$ 44,541	(22,941)				21,600
Cashless exercise of stock options, shares issued	759,281
Cashless exercise of stock options, shares outstanding	759,281
Cashless exercise of stock options, amount	$ 379		(379)				0
Issuance of stock options to employees			45,900				45,900
Net loss				(18,670,871)			(18,670,871)
Shares issued at Sep. 30, 2019	47,812,221
Balance, shares at Sep. 30, 2019	47,583,072	229,149
Balance, amount at Sep. 30, 2019	$ 23,904	$ (510,329)	95,043,388	166,937,574	24,233,544	(19,605,392)	266,122,689
Shares issued at Jun. 30, 2019	47,812,221
Balance, shares at Jun. 30, 2019	47,583,072	229,149
Balance, amount at Jun. 30, 2019	$ 23,904	$ (510,329)	95,043,388	179,966,602	24,233,544	(10,915,289)	287,841,820
Translation adjustment						(8,690,103)	(8,690,103)
Net loss				(13,029,028)			(13,029,028)
Shares issued at Sep. 30, 2019	47,812,221
Balance, shares at Sep. 30, 2019	47,583,072	229,149
Balance, amount at Sep. 30, 2019	$ 23,904	$ (510,329)	$ 95,043,388	$ 166,937,574	$ 24,233,544	$ (19,605,392)	$ 266,122,689

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (18,670,871)	$ (31,283,007)
Adjustments to reconcile net loss to net cash provided (used by) operating activities:
Interest on finance lease obligation	111,020	123,352
Amortization of prepaid land leases	0	546,767
Depreciation and amortization	10,599,011	14,177,727
Write-off/Impairment loss on property, plant and equipment	0	1,397,313
Loss on demolition of factory	0	18,644,473
Unrealized exchange gain on inter-company balances	(778,420)	(1,374,315)
Deferred tax asset	4,968,318	(10,258,506)
Common stock issued for services	21,600	0
Issuance of stock options to employee	45,900	0
Changes in assets and liabilities:
Accounts receivable	(9,962,625)	29,847,286
Inventories	(700,476)	1,148,833
Prepayments and deposits	(28,577)	4,944
Other receivables	11,794	(11,289)
Payable and accrued expenses	2,708,456	(211,728)
Retention payable	0	(312,429)
Taxes payable	(437,560)	541,241
Operating lease	(208,210)	0
Net cash (used in) provided by operating activities	(12,320,640)	22,980,662
CASH FLOWS USED IN INVESTING ACTIVITIES
Additions of prepaid land leases	0	(684,627)
Purchase of property, plant and equipment	(57,317,368)	(11,412,848)
Net cash used in investing activities	(57,317,368)	(12,097,475)
CASH FLOWS USED IN FINANCING ACTIVITIES
Repayment of capital lease obligation	(275,506)	(294,295)
Net cash used in financing activities	(275,506)	(294,295)
EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(3,866,852)	(11,249,711)
NET DECREASE IN CASH AND CASH EQUIVALENTS	(73,780,366)	(660,819)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	178,998,935	208,906,759
CASH AND CASH EQUIVALENTS - END OF PERIOD	105,218,569	208,245,940
Cash paid during the period for:
Income taxes	0	0
Operating right-of-use assets obtained in exchange for lease obligations	8,241,818	0
SUPPLEMENTAL DISCLOSURE OF CASH NON-CASH INVESTING AND FINANCING ACTIVITIES
Purchase of Property, plant and equipment included in Retention payable and taxes payable	7,116,066	0
Par value of common stock issued upon cashless exercise of options	$ 379	$ 0

1. BASIS OF PRESENTATION AND CO

1. BASIS OF PRESENTATION AND CONSOLIDATION	9 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	(a) Basis of Presentation and Consolidation The accompanying condensed financial statements have been prepared by Gulf Resources, Inc (“Gulf Resources”). a Nevada corporation and its subsidiaries (collectively, the “Company”), without audit, in accordance with the instructions to Form 10-Q and, therefore, do not necessarily include all information and footnotes necessary for a fair statement of its financial position, results of operations and cash flows in accordance with accounting principles generally accepted in the United States (“US GAAP”). In the opinion of management, the unaudited financial information for the three and nine months ended September 30, 2019 presented reflects all adjustments, which are only normal and recurring, necessary for a fair statement of results of operations, financial position and cash flows. These condensed financial statements should be read in conjunction with the financial statements included in the Company’s 2018 Form 10-K. Operating results for the interim periods are not necessarily indicative of operating results for an entire fiscal year. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may be different from the estimates. The Company also exercises judgments in the preparation of these condensed financial statements in certain areas, including classification of leases and related party transactions. The consolidated financial statements include the accounts of Gulf Resources, Inc. and its wholly-owned subsidiary, Upper Class Group Limited, a company incorporated in the British Virgin Islands, which owns 100% of Hong Kong Jiaxing Industrial Limited, a company incorporated in Hong Kong (“HKJI”). HKJI owns 100% of Shouguang City Haoyuan Chemical Company Limited ("SCHC") which owns 100% of Shouguang Yuxin Chemical Industry Co., Limited (“SYCI”) and Daying County Haoyuan Chemical Company Limited (“DCHC”). All material intercompany transactions have been eliminated on consolidation. (b) Nature of Business The Company manufactures and trades bromine and crude salt through its wholly-owned subsidiary, Shouguang City Haoyuan Chemical Company Limited ("SCHC") and manufactures chemical products for use in the oil industry, pesticides, paper manufacturing industry and for human and animal antibiotics through its wholly-owned subsidiary, Shouguang Yuxin Chemical Industry Co., Limited ("SYCI") in the People’s Republic of China (“PRC”). DCHC was established to further explore and develop natural gas and brine resources (including bromine and crude salt) in the PRC. DCHC’s business commenced trial operation in January 2019 but suspended production temporarily in May 2019 as required by the government to obtain project approval (see Note 1 (b)(iii)). (i) Bromine and Crude Salt Segments On September 1, 2017, the Company received notification from the Government of Yangkou County, Shouguang City of PRC that production at all its factories should be halted with immediate effect in order for the Company to perform rectification and improvement in accordance with the county’s new safety and environmental protection requirements. The Company worked closely with the county authorities to develop rectification plans for both its bromine and crude salt businesses and agreed on a plan in October 2017. In the fiscal year ended December 31, 2018, the Company incurred $16,243,677 in the rectification and improvements of plant and equipment of the bromine and crude salt factories resulting in a cumulative amount of $34,182,329 incurred as of December 31, 2018 recorded in the plant, property and equipment in the consolidated balance sheet. No such costs were incurred in the three-month and nine-month periods ended September 30, 2019 and the Company does not expect to incur any additional capital expenditure in the rectification of its bromine and crude salt factories in respect of meeting the county's new safety and environmental protection requirement. In the first quarter of 2018, six out of its ten bromine factories completed their rectification process within factory areas (i.e. excluding crude salt field area) and were approved and scheduled for production commencement by April 2018 as verbally indicated by the local government. The remaining four factories were still undergoing rectification at that time. Three factories (Factory no. 3, Factory no. 4 and Factory no. 11) had to be demolished in September 2018 as required by the government and rectification for Factory no. 10 was completed in November 2018. In 2018, the Shandong Provincial government required the local government to conduct “four rating and one comprehensive evaluation” for all of the chemical companies within its jurisdiction. This has delayed the production commencement schedule of the six bromine and crude salt factories in which rectification work was completed. On June 29 2018, the Company received a formal notice (dated June 25, 2018) jointly issued by various provincial government agencies in Shandong Province (the “Notice”) forwarded by the Weifang City Special Operations Leading Group Office of Safe Production, Transformation and Upgrading of Chemical Industry. In the Notice, the provincial government agencies set forth further requirements and procedures covering the following four aspects for the chemical industrial enterprises: project approval, planning approval, land use rights approval and environmental protection assessment approval. Those standards and procedures apply to all chemical industrial enterprises in Shandong Province including the Company’s bromine plants that have not completed project approval procedures, planning approval procedures, land use rights approval procedures and environmental protection assessment procedures. The Company believes that the government will not grant approval to the Company to allow its bromine and crude salt plants to resume operations until the Company has fully complied with the aforesaid rules set forth in the Notice. The Shouguang City Bromine Association, on behalf of all the bromine plants in Shouguang, has started discussions with the local government agencies. The local governmental agencies confirmed the facts that their initial requirements for the bromine industry did not include the project approval, the planning approval and the land use rights approval and that those three additional approvals were new requirements of the provincial government. The Company understood from the local government that it has been coordinating with several government agencies to solve these three outstanding approval issues in a timely manner and that all the affected bromine plants are not allowed to commence production prior to obtaining those approvals. In April 2019, Factory No.1, Factory No.5 and Factory No.7 (Factory no. 5 is considered part of Factory no.7 and both are managed as one factory since 2010) restarted operations upon receipt of verbal notification from local government of Yangkou County. On May 7, 2019, the Company renamed its Subdivision Factory No. 1 to Factory No. 4; and Factory No. 5 (which was previously considered part of Factory No. 7) to Factory No. 7. The Company is not certain when the issuance of the approval documents will be effected. The Company believes that this is another step by the government to improve the environment. It further believes the goal of the government is not to close all plants, but rather to codify the regulations related to project approval, land use, planning approval and environmental protection assessment approval so that illegal plants are not able to open in the future and so that plants close to population centers do not cause serious environmental damage. In addition, the Company believes that the Shandong provincial government wants to assure that each of its regional and county governments has applied the Notice in a consistent manner. The Company believes the issues related to the remaining five bromine and crude salt factories which have passed inspection are almost resolved. The Company is actively working with the local government to obtain the documentation for approval of project, planning, land use rights and environmental protection evaluation. (ii) Chemical Segment On November 24, 2017, the Company received a letter from the Government of Yangkou County, Shouguang City notifying the Company to relocate its two chemical production plants located in the second living area of the Qinghe Oil Extraction to the Bohai Marine Fine Chemical Industrial Park (“Bohai Park”). This is because the two plants are located in a residential area and their production activities will impact the living environment of the residents. This is as a result of the country’s effort to improve the development of the chemical industry, manage safe production and curb environmental pollution accidents effectively, and ensure the quality of the living environment of residents. All chemical enterprises which do not comply with the requirements of the safety and environmental protection regulations will be ordered to shut down. The Company believes this relocation process will cost approximately $60 million in total. The Company incurred relocation costs comprising prepaid land lease and professional fees related to the design of the new chemical factory in the amount of $10,925,081, which were recorded in the prepaid land leases and property, plant and equipment in the consolidated balance sheets as of September 30, 2019 and December 31, 2018. The Company does not anticipate that the Company’s new chemical factory to be significantly impacted by the Notice. The Company has secured from the government the land use rights for its chemical plants located at the Bohai Park and presented a completed construction design draft and other related documents to the local authorities for approval. The Company is still waiting for the last approval report and is uncertain when the approval will be issued. There could be a delay in the approval process given the ongoing rectification and approvals process for the Company’s other plants. As the construction of the new factory cannot commence until the final approval from the government is received, the delay in the receipt of the final approval will delay the commencement date of the construction of the new factory. (iii) Natural Gas Segment In January 2017, the Company completed the first brine water and natural gas well field construction in Daying located in Sichuan Province and commenced trial production in January 2019. On May 29, 2019, the Company received a verbal notice from the government of Tianbao Town ,Daying County, Sichuan Province, whereby the Company is required to obtain project approval for its well located in Daying, including the whole natural gas and brine water project, and approvals for safety production inspection, environmental protection assessment, and to solve the related land issue. Until these approvals have been received, the Company has to temporarily halt trial production at its natural gas well in Daying. (c) Allowance for Doubtful Accounts As of September 30, 2019 and December 31, 2018, There were no allowances for doubtful accounts. No allowances for doubtful accounts were charged to the condensed consolidated statements of loss for the three-month and nine-month periods ended September 30, 2019 and 2018. (d) Concentration of Credit Risk The Company is exposed to credit risk in the normal course of business, primarily related to accounts receivable and cash and cash equivalents. Substantially all of the Company’s cash and cash equivalents are maintained with financial institutions in the PRC, namely, Industrial and Commercial Bank of China Limited, China Merchants Bank Company Limited and Sichuan Rural Credit Union, which are not insured or otherwise protected. The Company placed $105,218,569 and $178,998,935 with these institutions as of September 30, 2019 and December 31, 2018, respectively. The Company has not experienced any losses in such accounts in the PRC. Concentrations of credit risk with respect to accounts receivable exists as the Company sells a substantial portion of its products to a limited number of customers. However, such concentrations of credit risks are limited since the Company performs ongoing credit evaluations of its customers’ financial condition and extends credit terms as and when appropriate. As of September 30, 2019, proceeds from accounts receivable balance outstanding of $0.58 million was collected in October 2019, In the amount collected, $0.47 million was for receivable more than 90 days old. As of December 31, 2018, there were no accounts receivable balances as they were all collected in the year ended December 31, 2018. (e) Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Expenditures for new facilities or equipment, and major expenditures for betterment of existing facilities or equipment are capitalized and depreciated, when available for intended use, using the straight-line method at rates sufficient to depreciate such costs less 5% residual value over the estimated productive lives. All other ordinary repair and maintenance costs are expensed as incurred. Mineral rights are recorded at cost less accumulated depreciation and any impairment losses. Mineral rights are amortized ratably over the term of the lease, or the equivalent term under the units of production method, whichever is shorter. Construction in process primarily represents direct costs of construction of property, plant and equipment. Costs incurred are capitalized and transferred to property, plant and equipment upon completion and depreciation will commence when the completed assets are placed in service. The Company’s depreciation and amortization policies on property, plant and equipment, other than mineral rights and construction in process, are as follows: Useful life (in years) Buildings (including salt pans) 8 - 20 Plant and machinery (including protective shells, transmission channels and ducts) 3 - 8 Motor vehicles 5 Furniture, fixtures and equipment 3-8 Property, plant and equipment under the finance lease are depreciated over their expected useful lives on the same basis as owned assets, or where shorter, the term of the lease, which is 20 years. Producing oil and gas properties are depreciated on a unit-of-production basis over the proved developed reserves. Common facilities that are built specifically to service production directly attributed to designated oil and gas properties are depreciated based on the proved developed reserves of the respective oil and gas properties on a pro-rata basis. Common facilities that are not built specifically to service identified oil and gas properties are depreciated using the straight-line method over their estimated useful lives. Costs associated with significant development projects are not depreciated until commercial production commences and the reserves related to those costs are excluded from the calculation of depreciation. (f) Retirement Benefits Pursuant to the relevant laws and regulations in the PRC, the Company participates in a defined contribution retirement plan for its employees arranged by a governmental organization. The Company makes contributions to the retirement plan at the applicable rate based on the employees’ salaries. The required contributions under the retirement plans are charged to the condensed consolidated statement of loss on an accrual basis when they are due. The Company’s contributions totaled $207,175 and $308,669 for the three-month period ended September 30, 2019 and 2018, respectively, and totaled $810,911 and $912,744 for the nine-month period ended September 30, 2019 and 2018, respectively. (g) Revenue Recognition Net revenue is net of discount and value added tax and comprises the sale of bromine, crude salt and chemical products. Revenue is recognized when the control of the promised goods is transferred to the customers in an amount that reflects the consideration that the Company expects to receive from the customers in exchange for those goods. The acknowledgement of receipt of goods by the customers is when control of the product is deemed to be transferred. Invoicing occurs upon acknowledgement of receipt of the goods by the customers. Customers have no rights to return the goods upon acknowledgement of receipt of goods. (h) Recoverability of Long-lived Assets In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360-10-35 “Impairment or Disposal of Long-lived Assets” The Company determines the existence of such impairment by measuring the expected future cash flows (undiscounted and without interest charges) and comparing such amount to the carrying amount of the assets. An impairment loss, if one exists, is then measured as the amount by which the carrying amount of the asset exceeds the discounted estimated future cash flows. Assets to be disposed of are reported at the lower of the carrying amount or fair value of such assets less costs to sell. Asset impairment charges are recorded to reduce the carrying amount of the long-lived asset that will be sold or disposed of to their estimated fair values. Charges for the asset impairment reduce the carrying amount of the long-lived assets to their estimated salvage value in connection with the decision to dispose of such assets. For the three and nine months period ended September 30, 2019, the Company determined that there were no events or circumstances indicating possible impairment of its long-lived assets. In the three and nine- month periods ended September 30, 2018, the Company recorded an impairment loss of $1,284,832 for the mineral rights for factories No 3 and No 4 due to closure notice from the People's Government of Yangkou Town, Shouguang City and a write-off of $112,481 for write-offs of certain wells and equipments damaged by flood from a typhoon during third quarter 2018. (i) Basic and Diluted Earnings per Share of Common Stock Basic earnings per common share are based on the weighted average number of shares outstanding during the periods presented. Diluted earnings per share are computed using weighted average number of common shares plus dilutive common share equivalents outstanding during the period. Potential common shares that would have the effect of increasing diluted earnings per share are considered to be anti-dilutive, i.e. the exercise prices of the outstanding stock options were greater than the market price of the common stock. Anti-dilutive common stock equivalents which were excluded from the calculation of number of dilutive common stock equivalents amounted to 587,720 and 259,590 shares for the three-month period ended September 30, 2019 and 2018, respectively, and amounted to 362,206 and 141,629 shares for the nine-month period ended September 30, 2019 and 2018, respectively. These awards could be dilutive in the future if the market price of the common stock increases and is greater than the exercise price of these awards. Because the Company reported a net loss for the three and nine months ended September 30, 2019 and 2018, common stock equivalents including stock options and warrants were anti-dilutive, therefore the amounts reported for basic and diluted loss per share were the same. (i) Reporting Currency and Translation The financial statements of the Company’s foreign subsidiaries are measured using the local currency, Renminbi (“RMB”), as the functional currency; whereas the functional currency and reporting currency of the Company is the United States dollar (“USD” or “$”). As such, the Company uses the “current rate method” to translate its PRC operations from RMB into USD, as required under FASB ASC 830 “Foreign Currency Matters”. The assets and liabilities of its PRC operations are translated into USD using the rate of exchange prevailing at the balance sheet date. The capital accounts are translated at the historical rate. Adjustments resulting from the translation of the balance sheets of the Company’s PRC subsidiaries are recorded in stockholders’ equity as part of accumulated other comprehensive loss. The statement of loss and comprehensive loss is translated at average rate during the reporting period. Gains or losses resulting from transactions in currencies other than the functional currencies are recognized in net loss for the reporting periods as part of general and administrative expense. The statement of cash flows is translated at average rate during the reporting period, with the exception of the consideration paid for the acquisition of business which is translated at historical rates. (j) Foreign Operations All of the Company’s operations and assets are located in PRC. The Company may be adversely affected by possible political or economic events in this country. The effect of these factors cannot be accurately predicted. (k) Exploration Costs Exploration costs, which included the cost of researching appropriate places to drill wells and the cost of well drilling in search of potential natural brine or other resources, are charged to the loss statement as incurred. Once the commercial viability of a project has been confirmed, all subsequent costs are capitalized. For oil and gas properties, the successful efforts method of accounting is adopted. The Company carries exploratory well costs as an asset when the well has found a sufficient quantity of reserves to justify its completion as a producing well and where the Company is making sufficient progress assessing the reserves and the economic and operating viability of the project. Exploratory well costs not meeting these criteria are charged to expenses. Exploratory wells that discover potentially economic reserves in areas where major capital expenditure will be required before production would begin and when the major capital expenditure depends upon the successful completion of further exploratory work remain capitalized and are reviewed periodically for impairment. (l) Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. Finance leases are included in finance lease ROU assets and finance lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease and finance lease ROU assets and liabilities are recognized at January 1, 2019 based on the present value of lease payments over the lease term discounted using the rate implicit in the lease. In cases where the implicit rate is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term. (m) Stock-based Compensation Common stock, stock options and stock warrants issued are recorded at their fair values estimated at grant date using the Black-Scholes model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The Company has elected to account for the forfeiture of stock-based awards as they occur. (n) New Accounting Pronouncements Recent accounting pronouncements adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The amendments in this Update specify the accounting for leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from operating leases. The Company adopted the standard effective January 1, 2019 under the optional transition method which allows an entity to apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment, if any, to the opening balance of retained earnings in the period of adoption. The Company elected the available practical expedients. As a result of the adoption of this standard, the Company recognized operating lease ROU assets of $8,817,327, operating lease liabilities of $8,137,541, and the remaining balance in the prepaid land lease and accrued expense in the condensed consolidated financial statements as of and for the nine months ended September 30, 2019 with no cumulative-effect adjustment to retained earnings as of January 1, 2019. In June 2018, the FASB issued ASU No.2018-07, Compensation- Stock Compensation (Topic 718). Improvements to Nonemployee Share-Based Payment Accounting. The amendments in this update expand the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. Prior to this update, Topic 718 applied only to share-based transactions to employees. Consistent with the accounting requirements for employee share-based payment awards, nonemployee share-based payment awards within the scope of Topic 718 are measured at grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. The amendments in the Update are effective for public business entities form fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company adopted this standard as of January 1, 2019. This adoption of this standard does not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. The amendments in this Update affect loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. The ASU requires an entity to recognize expected credit losses rather than incurred losses for financial assets. For public entities, the amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the effect of this on the condensed consolidated financial statements and related disclosure.

2. INVENTORIES

2. INVENTORIES	9 Months Ended
	Sep. 30, 2019
Inventory Disclosure [Abstract]
2. INVENTORIES	Inventories consist of: September 30, 2019 December 31, 2018 Raw materials $ 20,642 $ - Finished goods 660,008 65,169 Allowance for obsolete and slow-moving inventory - (65,169 ) $ 680,650 $ -

3. PREPAID LAND LEASES

3. PREPAID LAND LEASES	9 Months Ended
	Sep. 30, 2019
Prepaid Land Leases
3. PREPAID LAND LEASES	The Company has the rights to use certain parcels of land located in Shouguang, the PRC, through lease agreements signed with local townships or the government authority. The production facilities and warehouses of the Company are located on these parcels of land. The lease term ranges from ten to fifty years. Some of the lease contracts were paid in one lump sum upfront and some are paid annually at the beginning of each anniversary date. These leases have no purchase option at the end of the lease term and were classified as operating lease prior to and as of January 1, 2019 when the new lease standard was adopted. Prior to January 2019, the prepaid land lease was amortized on a straight line basis. As of January 1, 2019, all these leases that have commenced were classified as operating lease right-of-use assets (“ROU”). See Note 6. In December 2017, the Company paid a one lump sum upfront amount of $8,990,636 for a 50-year lease of a parcel of land at Bohai Marine Fine Chemical Industrial Park (“Bohai”) for the new chemical factory to be built. 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 is being processed by the government and the commencement date of the lease will be known upon completion of the application process. Since the construction plan of the factory at Bohai is still in the process of being approved by the government and the lease term of the land has not commenced, the Company classified the lease payment in prepaid land lease instead of Right-of –use assets. No amortization of this prepaid land lease was recorded as of September 30, 2019. During the three and nine months period ended September 30, 2018, amortization of prepaid land leases totaled $252,091 and $546,767, which amounts were recorded as direct labor and factory overheads incurred during plant shutdown. For parcels of land that are collectively owned by local townships, the Company cannot obtain land use rights certificates. The parcels of land of which the Company cannot obtain land use rights certificates cover a total of approximately 38.6 square kilometers with aggregate carrying value of $599,747 as at December 31, 2018 and the parcels of land of which the Company cannot obtain land use rights certificates covers a total of approximately 38.6 square kilometers with an aggregate operating lease right-of-use assets amount of $8,570,115 as at September 30, 2019.

4. PROPERTY, PLANT AND EQUIPMEN

4. PROPERTY, PLANT AND EQUIPMENT, NET	9 Months Ended
	Sep. 30, 2019
Property, Plant and Equipment [Abstract]
4. PROPERTY, PLANT AND EQUIPMENT, NET	Property, plant and equipment, net consist of the following: September 30, 2019 December 31, 2018 At cost: Mineral rights $ 2,726,661 $ 2,809,977 Buildings 59,061,773 60,866,462 Plant and machinery 231,460,194 161,178,816 Motor vehicles 6,045 6,230 Furniture, fixtures and office equipment 3,191,491 3,289,010 Construction in process 1,188,268 6,535,808 Total 297,634,432 234,686,303 Less: Accumulated depreciation and amortization (140,889,652) (134,681,628 ) Impairment (17,196,587) (17,722,045 ) Net book value $ 139,548,193 $ 82,282,630 The Company has certain buildings and salt pans erected on parcels of land located in Shouguang, PRC, and such parcels of land are collectively owned by local townships or the government authority. The Company has not been able to obtain property ownership certificates over these buildings and salt pans. The aggregate carrying values of these properties situated on parcels of the land are $19,881,983 and $20,409,998 as at September 30, 2019 and December 31, 2018, respectively. During the three-month period ended September 30, 2019, depreciation and amortization expense totaled $3,632,805 of which $2,449,352, $201,182 and $982,271 were recorded in direct labor and factory overheads incurred during plant shutdown, administrative expenses and cost of net revenue. During the nine-month period ended September 30, 2019,depreciation and amortization expense totaled $10,530,985 of which $7,535,376, $648,456 and $2,347,153 were recorded in direct labor and factory overheads incurred during plant shutdown, administrative expenses and cost of net revenue. During the three-month period ended September 30, 2018, depreciation and amortization expense totaled $4,601,338, of which $4,353,824 and $247,514 were recorded in direct labor and factory overheads incurred during plant shutdown and administrative expenses, respectively. During the nine-month period ended September 30, 2018, depreciation and amortization expense totaled $13,974,456, of which $13,210,971 and $763,485 were recorded in direct labor and factory overheads incurred during plant shutdown and administrative expenses, respectively.

5. FINANCE LEASE RIGHT-OF-USE A

5. FINANCE LEASE RIGHT-OF-USE ASSETS	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
5. FINANCE LEASE RIGHT-OF-USE ASSETS	Property, plant and equipment under finance leases, net consist of the following: September 30, 2019 December 31, 2018 At cost: Buildings $ 116,344 $ 119,899 Plant and machinery 2,128,342 2,193,375 Total 2,244,686 2,313,274 Less: Accumulated depreciation and amortization (2,066,305) (2,062,517 ) Net book value $ 178,381 $ 250,757 The above buildings erected on parcels of land located in Shouguang, PRC, are collectively owned by local townships. The Company has not been able to obtain property ownership certificates over these buildings as the Company could not obtain land use rights certificates on the underlying parcels of land. During the three and nine months period ended September 30, 2019, depreciation and amortization expense totaled $1,326 and $68,027, respectively, which was recorded in direct labor and factory overheads incurred during plant shutdown. During the three and nine months period ended September 30, 2018, depreciation and amortization expense totaled $64,874 and $203,271, respectively, which was recorded in direct labor and factory overheads incurred during plant shutdown.

6. OPERATING LEASE RIGHT-OF-USE

6. OPERATING LEASE RIGHT-OF-USE ASSETS	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
6. OPERATING LEASE RIGHT-OF-USE ASSETS	As of September 30, 2019, the total operating lease ROU assets was $8,817,327. The total operating lease cost for the three-month period ended September 30, 2019 and 2018 was $219,411 and $266,875. The total operating lease cost for the nine-month period ended September 30, 2019 and 2018 was $671,652 and $831,539. The Company has the rights to use certain parcels of land located in Shouguang, the PRC, through lease agreements signed with local townships or the government authority (See Note 3). For parcels of land that are collectively owned by local townships, the Company cannot obtain land use rights certificates. The parcels of land of which the Company cannot obtain land use rights certificates covers a total of approximately 38.6 square kilometers with an aggregate operating lease right-of-use assets of $8,570,115 as at September 30, 2019.

7. OTHER PAYABLE AND ACCRUED EX

7. OTHER PAYABLE AND ACCRUED EXPENSES	9 Months Ended
	Sep. 30, 2019
Payables and Accruals [Abstract]
7. OTHER PAYABLE AND ACCRUED EXPENSES	Payable and accrued expenses consist of the following: September 30, December 31, 2019 2018 Accounts payable $ - $ - Salary payable 308,181 241,343 Social security insurance contribution payable 104,480 140,326 Other payable-related party (see Note 8) 66,151 90,900 Deposit on subscription of a subsidiary's share 141,380 - Accrued expense-for repair work 2,912,355 104,246 Accrued expense-others 337,969 328,443 Total $ 3,870,516 $ 905,258 T

8. RELATED PARTY TRANSACTIONS

8. RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2019
Related Party Transactions [Abstract]
8. RELATED PARTY TRANSACTIONS	During the three-month period ended September 30, 2019, the Company borrowed a sum of $299,995 from Jiaxing Lighting Appliance Company Limited (Jiaxing Lighting”), in which Mr. Ming Yang, a shareholder and the Chairman of the Company, has a 100% equity interest. The amount due to Jiaxing Lighting was unsecured, interest free and repayable on demand and was fully settled in the three-month period ended September 30, 2019. There was no balance owing to Jiaxing Lighting as of September 30, 2019 and December 31, 2018. On September 25, 2012, the Company purchased five floors of a commercial building in the PRC, through SYCI, from Shandong Shouguang Vegetable Seed Industry Group Co., Ltd. (the “Seller”) at a cost of approximately $5.7 million in cash, of which Mr. Ming Yang, the Chairman of the Company, had a 99% equity interest in the Seller. During the first quarter of 2018, the Company entered into an agreement with the Seller, a related party, to provide property management services for an annual amount of approximately $88,202 for five years from January 1, 2018 to December 31, 2022. The expense associated with this agreement for the three and nine months ended September 30, 2019 was approximately $22,050 and $67,900.The expense associated with this agreement for the three and nine months ended September 30, 2018 was approximately $23,000 and $72,000.

9. TAXES PAYABLE

9. TAXES PAYABLE	9 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
9. TAXES PAYABLE	September 30, December 31, 2019 2018 Land use tax payable $ 768,962 $ 1,188,687 Value-added tax withheld from suppliers 2,977,283 - Other tax payable 274,547 - $ 4,020,792 $ 1,188,687

10. LEASE LIABILITIES-FINANCE A

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE	The components of finance lease liabilities were as follows: Imputed September 30, December 31, Interest rate 2019 2018 Total finance lease liability 6.7% $ 2,041,845 $ 2,267,025 Less: Current portion (162,132 ) (197,480 ) Finance lease liability, net of current portion $ 1,879,713 $ 2,069,545 Interest expenses from capital lease obligations amounted to $34,080 and $37,138 for the three-month period ended September 30, 2019 and 2018, respectively, which were charged to the condensed consolidated statement of income (loss). Interest expenses from capital lease obligations amounted to $111,020 and $123,352 for the nine-month period ended September 30, 2019 and 2018, respectively, which were charged to the condensed consolidated statement of income (loss). The components of operating lease liabilities as follows: Imputed September 30, December 31, Interest rate 2019 2018 Total Operating lease liabilities 4.89% $ 8,137,541 $ - Less: Current portion (406,156 ) - Operating lease liabilities, net of current portion $ 7,731,385 $ - The weighted average remaining operating lease term at September 30, 2019 was 23 years and the weighted average discounts rate was 4.89%, This discount rates used are based on the base rate quoted by the People's Bank of China and vary with the remaining term of the lease. Maturities of lease liabilities were as follows: Financial lease Operating Lease Payable within: the next 12 months $ 265,370 $ 762,298 the next 13 to 24 months 265,370 775,828 the next 25 to 36 months 265,370 628,579 the next 37 to 48 months 265,370 635,341 the next 49 to 60 months 265,370 633,168 thereafter 1,592,225 11,285,715 Total 2,919,075 14,720,929 Less: Amount representing interest (877,230 ) (6,583,388 ) Present value of net minimum lease payments $ 2,041,845 $ 8,137,541

11. EQUITY

11. EQUITY	9 Months Ended
	Sep. 30, 2019
Equity [Abstract]
11. EQUITY	Retained Earnings - Appropriated In accordance with the relevant PRC regulations and the PRC subsidiaries’ Articles of Association, the Company’s PRC subsidiaries are required to allocate its profit after tax to the following reserve: Statutory Common Reserve Funds SCHC, SYCI and DCHC are required each year to transfer at least 10% of the profit after tax as reported under the PRC statutory financial statements to the Statutory Common Reserve Funds until the balance reaches 50% of the registered share capital. This reserve can be used to make up any loss incurred or to increase share capital. Except for the reduction of losses incurred, any other application should not result in this reserve balance falling below 25% of the registered capital. The Statutory Common Reserve Fund as of September 30, 2019 for SCHC, SYCI and DCHC is 46%, 14% and 0% of its registered capital respectively.

12. TREASURY STOCK

12. TREASURY STOCK	9 Months Ended
	Sep. 30, 2019
Equity [Abstract]
12. TREASURY STOCK	In January 2019, the Company issued 20,000 shares of common stock from the treasury shares to one of its consultants. The shares were valued at the closing market price on the date of the agreement and recorded as general and administrative expense in the condensed consolidated statement of loss and comprehensive loss for the nine months ended September 30, 2019. The shares issued were deducted from the treasury shares at weighted average cost and the excess of the cost over the closing market price was charged to additional paid-in-capital. On September 13, 2019, the Company received a staff deficiency notice from The Nasdaq Stock Market informing the Company that it has failed to comply with Nasdaq's shareholder approval requirements relating to shares issued to this consultant. A total of 40,000 restricted shares issued to this consultant from treasury will be canceled. The Company will reissue the same amount of shares from the 2019 Omnibus Equity Incentive Plan adopted by the board of directors of the Company subject to the approval by the stockholders of the Company at the annual meeting of the stockholders. This annual meeting of the stockholders of the Company is scheduled to take place on December 18, 2019. On October 30, 2019, the Company received a letter from Nasdaq notifying the Company that Nasdaq has granted the Company an extension until January 7, 2020, to regain compliance with the Rule. Under the terms of the extension, the Company must provide, on or before January 7, 2020, evidence that it has cancelled the Consultant Shares and re-issued the shares under the Plan. In the event that the Company does not satisfy the terms set forth in the extension, Nasdaq will provide written notification that the Company's securities will be delisted. In such an event, the Company may appeal Nasdaq's determination to a hearing panel.

13. STOCK-BASED COMPENSATION

13. STOCK-BASED COMPENSATION	9 Months Ended
	Sep. 30, 2019
Share-based Payment Arrangement [Abstract]
13. STOCK-BASED COMPENSATION	Pursuant to the Company’s Amended and Restated 2007 Equity Incentive Plan approved in 2011(“Plan”), the aggregate number shares of the Company’s common stock available for grant of stock options and issuance is 4,341,989 shares. On October 5, 2015, during the annual meeting of the Company’s stockholders, the aggregate number of shares reserved and available for grant and issuance pursuant to the Plan was increased to 10,341,989. As of September 30, 2019, the number of shares of the Company’s common stock available for issuance under the Plan is 4,920,989. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model. The risk free rate is based on the yield-to-maturity in continuous compounding of the US Government Bonds with the time-to-maturity similar to the expected tenor of the option granted, volatility is based on the annualized historical stock price volatility of the Company, and the expected life is based on the historical option exercise pattern. On April 01, 2019, the Company granted to one employee staff options to purchase 150,000 shares of the Company’s common stock, at an exercise price of $0.91 per share and the options vested immediately. The options were valued at $45,900 fair value, with assumed 45.26% volatility, a four-year expiration term with an expected tenor of 1.60 years, a risk free rate of 2.37% and no dividend yield. During the three months ended September 30, 2019, there were no options issued to employees or non-employees. The following table summarizes all Company stock option transactions between January 1, 2019 and September 30, 2019. Number of Option and Warrants Outstanding and exercisable Weighted- Average Exercise price of Option and Warrants Range of Exercise Price per Common Share Balance, January 1, 2019 2,518,000 $0.97 $0.71 - $4.80 Granted and vested during the period ended September 30, 2019 150,000 $0.91 $0.91 Exercised during the period ended September 30, 2019 (1,897,000) $0.73 $0.73 Expired/cancelled during the period ended September 30, 2019 (65,500) $2.31 $2.61 Balance, September 30, 2019 705,500 $1.47 $0.71 - $2.10 Stock and Warrants Options Exercisable and Outstanding Weighted Average Remaining Outstanding at September 30, 2019 Range of Exercise Prices Contractual Life (Years) Exercisable and outstanding 705,500 $0.71 - $2.10 1.74 The aggregate intrinsic value of options outstanding and exercisable as of September 30, 2019 was $0. During the three months ended September 30, 2019, 0 shares of common stock were issued upon cashless exercise of 0 options. During the nine months ended September 30, 2019, 759,281 shares of common stock were issued upon cashless exercise of 1,897,000 options. The aggregate intrinsic value of options exercised during the three months ended September 30, 2019 was $0. There was no option exercised during the three months ended September 30, 2018. The aggregate intrinsic value of options exercised during the nine months ended September 30, 2019 was $922,429. There was no option exercised during the nine months ended September 30, 2018.

14. INCOME TAXES

14. INCOME TAXES	9 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
14. INCOME TAXES	The Company utilizes the asset and liability method of accounting for income taxes in accordance with FASB ASC 740-10. (a) United States (“US”) Gulf Resources, Inc. may be subject to the United States of America Tax laws at a tax rate of 21%. No provision for the US federal income taxes has been made as the Company had no US taxable income for the three-month and nine-month periods ended September 30, 2019 and 2018, and management believes that its earnings are permanently invested in the PRC. On December 22, 2017, the Tax Cuts and Jobs Act (“TCJA”) was enacted in law. With the new tax law, the corporation income tax rate is reduced from 35% to 21% and there is a one-time mandatory transition tax on accumulated foreign earnings. The Company computed this one-time mandatory transition tax on accumulated foreign earnings to be approximately $5.4 million. However, as the Company has available US federal net operating loss carry forwards and foreign tax credit to fully offset the mandatory inclusion of the accumulated foreign earnings, no net tax liability arose from the inclusion of these accumulated foreign earnings. (b) British Virgin Islands (“BVI”) Upper Class Group Limited, a subsidiary of Gulf Resources, Inc., was incorporated in the BVI and, under the current laws of the BVI, it is not subject to tax on income or capital gain in the BVI. Upper Class Group Limited did not generate assessable profit for the three-month and nine-month periods ended September 30, 2019 and 2018. (c) Hong Kong HKJI, a subsidiary of Upper Class Group Limited, was incorporated in Hong Kong and is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived from Hong Kong. No provision for income tax has been made as it has no taxable income for the three-month and nine-month periods ended September 30, 2019 and 2018. The applicable statutory tax rates for the three-month and nine-month periods ended September 30, 2019 and 2018 are 16.5%. There is no dividend withholding tax in Hong Kong. (d) PRC Enterprise income tax (“EIT”) for SCHC, SYCI and DCHC in the PRC is charged at 25% of the assessable profits. The operating subsidiaries SCHC, SYCI and DCHC are wholly foreign-owned enterprises (“FIE”) incorporated in the PRC and are subject to PRC Local Income Tax Law. The PRC tax losses may be carried forward to be utilized against future taxable profit for ten years for High-tech enterprises and small and medium-sized enterprises of science and technology and for five years for other companies. Tax losses of the operating subsidiaries of the Company may be carried forward for five years. On February 22, 2008, the Ministry of Finance (“MOF”) and the State Administration of Taxation (“SAT”) jointly issued CaiShui [2008] Circular 1 (“Circular 1”). According to Article 4 of Circular 1, distributions of accumulated profits earned by a FIE prior to January 1, 2008 to foreign investor(s) in 2008 will be exempted from withholding tax (“WHT”) while distribution of the profit earned by an FIE after January 1, 2008 to its foreign investor(s) shall be subject to WHT at 5% effective tax rate. As of September 30, 2019 and December 31, 2018, the accumulated distributable earnings under the Generally Accepted Accounting Principles (GAAP”) of PRC that are subject to WHT are $215,205,425 and $240,563,868, respectively. Since the Company intends to reinvest its earnings to further expand its businesses in mainland China, its foreign invested enterprises do not intend to declare dividends to their immediate foreign holding companies in the foreseeable future. Accordingly, as of September 30, 2019 and December 31, 2018, the Company has not recorded any WHT on the cumulative amount of distributable retained earnings of its foreign invested enterprises that are subject to WHT in China. As of September 30, 2019 and December 31, 2018, the unrecognized WHT are $9,797,344 and $11,035,843, respectively. The Company’s income tax returns are subject to the various tax authorities’ examination. The federal, state and local authorities of the United States may examine the Company’s income tax returns filed in the United States for three years from the date of filing. The Company’s US income tax returns since 2015 are currently subject to examination. Inland Revenue Department of Hong Kong (“IRD”) may examine the Company’s income tax returns filed in Hong Kong for seven years from date of filing. For the years 2012 through 2018, HKJI did not report any taxable income. It did not file any income tax returns during these years except for 2014 and 2018. For companies which do not have taxable income, IRD typically issues notification to companies requiring them to file income tax returns once in every four years. The tax returns for 2014 and 2018 are currently subject to examination. The components of the provision for income tax (expense) income tax benefit from continuing operations are: Three-Month Period Ended September 30, Nine-Month Period Ended September 30, 2019 2018 2019 2018 Current taxes – PRC $ - $ - $ - $ - Deferred taxes – PRC 1,650,132 7,205,521 3,756,199 10,338,103 Change in valuation allowance (8,379,571) (24,000) (8,724,517) (79,595) $ (6,729,439) $ 7,181,521 $ (4,968,318) $ 10,258,508 The effective income tax benefit (expense) rate differs from the PRC statutory income tax rate of 25% from continuing operations in the PRC as follows: Three-Month Period Ended September 30, Nine-Month Period Ended September 30, Reconciliations 2019 2018 2019 2018 Statutory income tax rate 25 % 25 % 25 % 25 % Non-taxable income 1 % 2 % 2 % - Change in valuation allowance (133 %) - (63 %) - Effective income tax benefit (expense) rate (107 %) 27 % (36 %) 25 % Significant components of the Company’s deferred tax assets and liabilities at September 30, 2019 and December 31, 2018 are as follows: September 30, December 31, 2019 2018 Deferred tax liabilities $ - $ - Deferred tax assets: Allowance for obsolete and slow-moving inventories $ - $ 16,292 Impairment on property, plant and equipment 3,197,763 3,696,332 Impairment on prepaid land lease 815,370 840,284 Exploration costs 1,760,181 1,813,965 Compensation costs of unexercised stock options 171,672 194,016 PRC tax losses 16,043,972 12,663,985 US federal net operating loss and foreign tax credit 508,102 119,000 Total deferred tax assets 22,497,060 19,343,874 Valuation allowance (9,037,533) (313,016 ) Net deferred tax asset $ 13,459,527 $ 19,030,858 The increase in valuation allowance for the three-month period ended September 30, 2019 is $8,379,571. The increase in valuation allowance for the three-month period ended September 30, 2018 is $24,000. The increase in valuation allowance for the nine-month period ended September 30, 2019 is $8,724,517. The increase in valuation allowance for the nine-month period ended September 30, 2018 is $79,595. The increase in valuation allowance in the three and nine months ended September 30, 2019 is mainly attributable to valuation allowance recorded for the deferred tax assets related to a portion of the PRC tax losses that more likely than not will expire before it could be utilized and the exploration costs which more likely than not will not be realized. There were no unrecognized tax benefits and accrual for uncertain tax positions as of September 30, 2019 and December 31, 2018. There were no amounts accrued for penalties and interest for the three and nine months ended September 30, 2019 and 2018. There were no change in unrecognized tax benefits during the three and nine months ended September 30, 2019 and 2018.

15. BUSINESS SEGMENTS

15. BUSINESS SEGMENTS	9 Months Ended
	Sep. 30, 2019
Segment Reporting [Abstract]
15. BUSINESS SEGMENTS	An operating segment’s performance is primarily evaluated based on segment operating income, which excludes share-based compensation expense, certain corporate costs and other income not associated with the operations of the segment. These corporate costs (income) are separately stated below and also include costs that are related to functional areas such as accounting, treasury, information technology, legal, human resources, and internal audit. The Company believes that segment operating income, as defined above, is an appropriate measure for evaluating the operating performance of its segments. All the customers are located in PRC. Three-Month Period Ended September 30, 2019 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue $ 4,270,863 $ 277,679 $ — $ — $ 4,548,542 $ — $ 4,548,542 Net revenue — — — — — — — Income(loss) from operations before income tax benefit (5,185,484 ) (1,001,988 ) (744,963 ) (62,265 ) (6,994,700 ) 628,291 (6,366,409 ) Income tax (expense) benefit (5,778,726 ) (1,116,620 ) 165,907 — (6,729,439 ) — (6,729,439 ) Income(loss) from operations after (10,964,210 ) (2,118,608 ) (579,056 ) (62,265 ) (13,724,139 ) 628,291 (13,095,848 ) Total assets 153,825,697 21,738,770 110,464,372 1,767,155 287,795,994 150,836 287,946,830 Depreciation and amortization 3,303,155 182,538 113,357 35,081 3,634,131 — 3,634,131 Capital expenditures 56,137,239 1,180,129 — — 57,317,368 — 57,317,368 Three-Month Period Ended September 30, 2018 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue $ — $ 343,080 $ — $ — $ 343,080 $ — $ 343,080 Net revenue — — — — — — — Income(loss) from operations before income tax benefit (24,369,917 ) (2,611,203 ) (698,693 ) (32,079 ) (27,711,892 ) 912,975 (26,798,917 ) Income tax benefit 4,774,432 2,171,383 235,706 — 7,181,521 — 7,181,521 Income (loss) from operations after (19,595,485 ) (439,820 ) (462,987 ) (32,079 ) (20,530,371 ) 912,975 (19,617,396 ) Total assets 119,939,092 39,297,116 175,343,915 1,903,319 336,483,442 16,927 336,500,369 Depreciation and amortization 3,948,751 600,912 116,549 — 4,666,212 — 4,666,212 Capital expenditures 936,598 142,529 — — 1,079,127 — 1,079,127 Goodwill — — 27,902,709 — 27,902,709 — 27,902,709 * Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of respective segment. Nine -Month Period Ended September 30, 2019 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue $ 10,022,027 $ 522,758 $ — $ 51,736 $ 10,596,521 $ — $ 10,596,521 Net revenue — — — — — — — Income(loss) from operations before income tax benefit (8,847,210 ) (3,242,534 ) (2,074,937 ) (165,649 ) (14,330,330 ) 369,725 (13,960,605 ) Income tax (expense) benefit (4,871,839 ) (548,308 ) 451,828 — (4,968,319 ) — (4,968,319 ) Income(loss) from operations after (13,719,049 ) (3,790,842 ) (1,623,109 ) (165,649 ) (19,298,649 ) 369,725 (18,928,924 ) Total assets 153,825,697 21,738,770 110,464,372 1,767,155 287,795,994 150,836 287,946,830 Depreciation and amortization 8,442,421 1,701,769 346,985 107,836 10,599,011 — 10,599,011 Capital expenditures 56,137,239 1,180,129 — — 57,317,368 — 57,317,368 Nine -Month Period Ended September 30, 2018 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue $ — $ 1,981,573 $ 613,368 $ — $ 2,594,941 $ — $ 2,594,941 Net revenue — — — — — — — Income(loss) from operations before income tax benefit (35,537,744 ) (5,150,679 ) (2,101,059 ) (113,029 ) (42,902,511 ) 975,007 (41,927,504 ) Income tax benefit 7,745,098 2,613,721 (100,311 ) — 10,258,508 — 10,258,508 Income (loss) from operations after (27,792,646 ) (2,536,958 ) (2,201,370 ) (113,029 ) (32,644,003 ) 975,007 (31,668,996 ) Total assets 119,939,092 39,297,116 175,343,915 1,903,319 336,483,442 16,927 336,500,369 Depreciation and amortization 11,686,782 2,125,762 365,183 — 14,177,727 — 14,177,727 Capital expenditures 8,843,486 1,345,783 1,192,963 30,616 11,412,848 — 11,412,848 Goodwill — — 27,902,709 — 27,902,709 — 27,902,709 * Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of the respective segment. Three-Month Period Ended September 30, Nine-Month Period Ended September 30, Reconciliations 2019 2018 2019 2018 Total segment operating loss $ (6,994,700) $ (27,711,892) $ (14,330,330) $ (42,902,511) Corporate costs (105,702) (116,254) (408,695) (399,308) Unrealized gain on translation of intercompany balance 733,993 1,029,229 778,420 1,374,315 Loss from operations (6,366,409) (26,798,917) (13,960,605) (41,927,504) Other income, net of expense 66,820 124,362 258,052 385,989 Loss before taxes $ (6,299,589) $ (26,674,555) $ (13,702,553) $ (41,541,515) The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 2019. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ 843 $ 103 $ — $ 946 20.8 % 2 Shouguang Weidong Chemical Company Limited $ 529 $ 84 $ — $ 613 13.5 % 3 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ 500 $ 90 $ — $ 590 13 % 4 Dongying Bomeite Chemical Company Limited $ 557 $ — $ — $ 557 12.2 % 5 Shandong Shouguang Shenrunfa Ocean Chemical Company Limited $ 525 $ — $ — $ 525 11.5 % The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 2019. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ 2,203 $ 175 $ — $ 2,378 22.6 % 2 Shouguang Weidong Chemical Company Limited $ 1,629 $ 154 $ — $ 1,783 16.9 % 3 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ 1,539 $ 192 $ — $ 1,731 16.4 % 4 Dongying Bomeite Chemical Company Limited $ 1,098 $ — $ — $ 1,098 10.4 % 5 Shandong Shouguang Shenrunfa Ocean Chemical Company Limited $ 1,297 $ — $ — $ 1,297 12.3 % The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 2018. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ — $ 122 $ — $ 122 35 % 2 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ — $ 112 $ — $ 112 33 % 3 Shouguang Weidong Chemical Company Limited $ — $ 109 $ — $ 109 32 % The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 2018. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ — $ 656 $ 155 $ 811 31 % 2 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ — $ 783 $ — $ 783 30 % 3 Shouguang Weidong Chemical Company Limited $ — $ 543 $ — $ 543 21 %

16. CUSTOMER CONCENTRATION

16. CUSTOMER CONCENTRATION	9 Months Ended
	Sep. 30, 2019
Risks and Uncertainties [Abstract]
16. CUSTOMER CONCENTRATION	During the nine-month period ended September 30, 2019, the Company sold 78.5% of its products to its top five customers, respectively. As of September 30, 2019, amounts due from these customers were $8,834,543. The Company sells a substantial portion of its products to a limited number of customers. During the three-month and nine-month periods ended September 30, 2018, the Company sold 100% and 90% of its products to its top five customers, respectively. As of September 30, 2018, amounts due from these customers were $396,494.

17. MAJOR SUPPLIERS

17. MAJOR SUPPLIERS	9 Months Ended
	Sep. 30, 2019
Major Suppliers
17. MAJOR SUPPLIERS	During the nine-month period ended September 30, 2019, the Company purchased 100% of its raw materials from its top five suppliers. As of September 30, 2019, amounts due to those suppliers were $0. During the nine-month period ended September 30, 2018, the Company did not purchase any raw materials.

18. FAIR VALUE OF FINANCIAL INS

18. FAIR VALUE OF FINANCIAL INSTRUMENTS	9 Months Ended
	Sep. 30, 2019
Fair Value Disclosures [Abstract]
18. FAIR VALUE OF FINANCIAL INSTRUMENTS	The carrying values of financial instruments, which consist of cash, accounts receivable and accounts payable and other payables, approximate their fair values due to the short-term nature of these instruments. There were no material unrecognized financial assets and liabilities as of September 30, 2019 and December 31, 2018.

19. CAPITAL COMMITMENT AND OPER

19. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS	9 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
19. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS	The following table sets forth the Company’s contractual obligations as of September 30, 2019: Property Management Fees Capital Expenditure Payable within: the next 12 months $ 88,202 $ 25,448 the next 13 to 24 months 88,202 — the next 25 to 36 months 88,202 — the next 37 to 48 months 88,202 — Total $ 352,808 $ 25,448

20. LOSS CONTINGENCIES

20. LOSS CONTINGENCIES	9 Months Ended
	Sep. 30, 2019
Subsequent Events [Abstract]
LOSS CONTINGENCIES	On or about August 3, 2018, written decisions of administration penalty captioned Shou Guo Tu Zi Fa Gao Zi [2018] No. 291, Shou Guo Tu Zi Fa Gao Zi [2018] No. 292, Shou Guo Tu Zi Fa Gao Zi [2018] No. 293, Shou Guo Tu Zi Fa Gao Zi [2018] No. 294, Shou Guo Tu Zi Fa Gao Zi [2018] No. 295 and Shou Guo Tu Zi Fa Gao Zi [2018] No. 296 (together, the “Written Decisions”) were served on Shouguang City Haoyuan Chemical Company Limited ("SCHC") by the Shouguang City Natural Resources and Planning Bureau (the “Bureau”), naming SCHC as respondent. The Written Decisions challenged the land use of Factory nos. 2, 9, 7, 4, 8 and 10, respectively, and alleged, among other things, that SCHC had illegally occupied and used the land in the total area of approximately 52,674 square meter, on which Factory nos. 2, 9, 7, 4, 8 and 10 were built. The Written Decisions ordered SCHC, among other things, to return the land subject to the Written Decisions to its respective legal owner, restore the land to its original state, and demolish or confiscate all the buildings and facilities thereon and pay monetary penalty of approximately RMB 1.3 million ($184,000) in the aggregate. Each of the Written Decisions were to be executed within 15 days upon serving SCHC. Additional interest penalties would be imposed at a daily rate of 3% in the event that SCHC did not make the monetary penalty payment in a timely manner. As discussed below, the Company did not believe the local government would enforce the penalties so it did not make the payment. Subsequently, the Bureau filed enforcement actions to the People’s Court of Shouguang City, Shandong Province (the “Court”), naming SCHC as enforcement respondent and alleged, among other things, that SCHC failed to perform its obligations under each of the Written Decisions within the specified timeframe. The enforcement proceedings sought court orders to enforce the Written Decisions. On May 5, 2019, written decisions of administrative ruling captioned (2019) Lu 0783 Xing Shen No. 384, (2019) Lu 0783 Xing Shen No. 385, (2019) Lu 0783 Xing Shen No. 389, (2019) Lu 0783 Xing Shen No. 390, (2019) Lu 0783 Xing Shen No. 393, and (2019) Lu 0783 Xing Shen No. 394, respectively (together, the “Court Rulings”) were made by the Court in favor of the Bureau. The Court ordered, among other relief, to enforce each of the Written Decisions, to return each subject land to its legal owner and demolish or confiscate the buildings and facilities thereon and restore the land to its original state within 10 days from the service of the Court Rulings on SCHC. The Court Rulings became enforceable immediately upon service on SCHC on May 5, 2019. In the last twenty years, there were no government regulations requiring bromine manufacturers to obtain land use and planning approval documents. As such, we believe most of the bromine manufacturers in Shouguang City do not have land use and planning approval documents and lease their land parcels from the village associations and are facing the same issues in connection with land use and planning as the Company. The Company has been in the process of resolving the issues in connection with SCHC’s land use and planning diligently. The Company has been in close discussion with the local government authorities with the help from Shouguang City Bromine Association to seek relief and, based on verbal confirmation by local government authorities, believes the administrative penalties imposed by the Bureau according to the Written Decisions are being re-assessed by local government authorities and may be revoked. The Company has obtained verbal confirmation from local government authorities that the administrative penalty imposed on Factory No. 7 and Factory No. 8 are being revoked, and production at Factory No. 7 was allowed to resume in April 2019. In addition, on August 28, 2019, the People's Government of Shandong Province, issued a regulation titled "Investment Project Management Requirements of Chemical Companies in Shandong Province" permitting the construction of facilities on existing sites or infrastructure of bromine manufacturing and other chemical industry-related types of projects (clause 11 of section 3). The Company believes that the goal of the government is to standardize and regulate the industry and not to demolish the facilities or penalize the manufacturers. As of the date of this report, the Company has not been notified by the local government that it will take any measure to enforce the administrative penalties or implement the Court Rulings. Based on information known to date, the Company believes that it is remote that the Written Decisions or Court Rulings will be enforced within the expected timeframe, and a material penalty or costs and expenses against the Company will result. However, there can be no assurance that there will not be any further enforcement action, the occurrence of which may result in further liabilities, penalties and operational disruption. In view of the above facts and circumstances, the Company believes that it is not necessary to accrue for any estimated losses or impairment as of September 30, 2019.

1. BASIS OF PRESENTATION AND _2

1. BASIS OF PRESENTATION AND CONSOLIDATION (Policies)	9 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Basis of Presentation and Consolidation	The accompanying condensed financial statements have been prepared by Gulf Resources, Inc (“Gulf Resources”). a Nevada corporation and its subsidiaries (collectively, the “Company”), without audit, in accordance with the instructions to Form 10-Q and, therefore, do not necessarily include all information and footnotes necessary for a fair statement of its financial position, results of operations and cash flows in accordance with accounting principles generally accepted in the United States (“US GAAP”). In the opinion of management, the unaudited financial information for the three and nine months ended September 30, 2019 presented reflects all adjustments, which are only normal and recurring, necessary for a fair statement of results of operations, financial position and cash flows. These condensed financial statements should be read in conjunction with the financial statements included in the Company’s 2018 Form 10-K. Operating results for the interim periods are not necessarily indicative of operating results for an entire fiscal year. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may be different from the estimates. The Company also exercises judgments in the preparation of these condensed financial statements in certain areas, including classification of leases and related party transactions. The consolidated financial statements include the accounts of Gulf Resources, Inc. and its wholly-owned subsidiary, Upper Class Group Limited, a company incorporated in the British Virgin Islands, which owns 100% of Hong Kong Jiaxing Industrial Limited, a company incorporated in Hong Kong (“HKJI”). HKJI owns 100% of Shouguang City Haoyuan Chemical Company Limited ("SCHC") which owns 100% of Shouguang Yuxin Chemical Industry Co., Limited (“SYCI”) and Daying County Haoyuan Chemical Company Limited (“DCHC”). All material intercompany transactions have been eliminated on consolidation.
Nature of the Business	The Company manufactures and trades bromine and crude salt through its wholly-owned subsidiary, Shouguang City Haoyuan Chemical Company Limited ("SCHC") and manufactures chemical products for use in the oil industry, pesticides, paper manufacturing industry and for human and animal antibiotics through its wholly-owned subsidiary, Shouguang Yuxin Chemical Industry Co., Limited ("SYCI") in the People’s Republic of China (“PRC”). DCHC was established to further explore and develop natural gas and brine resources (including bromine and crude salt) in the PRC. DCHC’s business commenced trial operation in January 2019 but suspended production temporarily in May 2019 as required by the government to obtain project approval (see Note 1 (b)(iii)). (i) Bromine and Crude Salt Segments On September 1, 2017, the Company received notification from the Government of Yangkou County, Shouguang City of PRC that production at all its factories should be halted with immediate effect in order for the Company to perform rectification and improvement in accordance with the county’s new safety and environmental protection requirements. The Company worked closely with the county authorities to develop rectification plans for both its bromine and crude salt businesses and agreed on a plan in October 2017. In the fiscal year ended December 31, 2018, the Company incurred $16,243,677 in the rectification and improvements of plant and equipment of the bromine and crude salt factories resulting in a cumulative amount of $34,182,329 incurred as of December 31, 2018 recorded in the plant, property and equipment in the consolidated balance sheet. No such costs were incurred in the three-month and nine-month periods ended September 30, 2019 and the Company does not expect to incur any additional capital expenditure in the rectification of its bromine and crude salt factories in respect of meeting the county's new safety and environmental protection requirement. In the first quarter of 2018, six out of its ten bromine factories completed their rectification process within factory areas (i.e. excluding crude salt field area) and were approved and scheduled for production commencement by April 2018 as verbally indicated by the local government. The remaining four factories were still undergoing rectification at that time. Three factories (Factory no. 3, Factory no. 4 and Factory no. 11) had to be demolished in September 2018 as required by the government and rectification for Factory no. 10 was completed in November 2018. In 2018, the Shandong Provincial government required the local government to conduct “four rating and one comprehensive evaluation” for all of the chemical companies within its jurisdiction. This has delayed the production commencement schedule of the six bromine and crude salt factories in which rectification work was completed. On June 29 2018, the Company received a formal notice (dated June 25, 2018) jointly issued by various provincial government agencies in Shandong Province (the “Notice”) forwarded by the Weifang City Special Operations Leading Group Office of Safe Production, Transformation and Upgrading of Chemical Industry. In the Notice, the provincial government agencies set forth further requirements and procedures covering the following four aspects for the chemical industrial enterprises: project approval, planning approval, land use rights approval and environmental protection assessment approval. Those standards and procedures apply to all chemical industrial enterprises in Shandong Province including the Company’s bromine plants that have not completed project approval procedures, planning approval procedures, land use rights approval procedures and environmental protection assessment procedures. The Company believes that the government will not grant approval to the Company to allow its bromine and crude salt plants to resume operations until the Company has fully complied with the aforesaid rules set forth in the Notice. The Shouguang City Bromine Association, on behalf of all the bromine plants in Shouguang, has started discussions with the local government agencies. The local governmental agencies confirmed the facts that their initial requirements for the bromine industry did not include the project approval, the planning approval and the land use rights approval and that those three additional approvals were new requirements of the provincial government. The Company understood from the local government that it has been coordinating with several government agencies to solve these three outstanding approval issues in a timely manner and that all the affected bromine plants are not allowed to commence production prior to obtaining those approvals. In April 2019, Factory No.1, Factory No.5 and Factory No.7 (Factory no. 5 is considered part of Factory no.7 and both are managed as one factory since 2010) restarted operations upon receipt of verbal notification from local government of Yangkou County. On May 7, 2019, the Company renamed its Subdivision Factory No. 1 to Factory No. 4; and Factory No. 5 (which was previously considered part of Factory No. 7) to Factory No. 7. The Company is not certain when the issuance of the approval documents will be effected. The Company believes that this is another step by the government to improve the environment. It further believes the goal of the government is not to close all plants, but rather to codify the regulations related to project approval, land use, planning approval and environmental protection assessment approval so that illegal plants are not able to open in the future and so that plants close to population centers do not cause serious environmental damage. In addition, the Company believes that the Shandong provincial government wants to assure that each of its regional and county governments has applied the Notice in a consistent manner. The Company believes the issues related to the remaining five bromine and crude salt factories which have passed inspection are almost resolved. The Company is actively working with the local government to obtain the documentation for approval of project, planning, land use rights and environmental protection evaluation. (ii) Chemical Segment On November 24, 2017, the Company received a letter from the Government of Yangkou County, Shouguang City notifying the Company to relocate its two chemical production plants located in the second living area of the Qinghe Oil Extraction to the Bohai Marine Fine Chemical Industrial Park (“Bohai Park”). This is because the two plants are located in a residential area and their production activities will impact the living environment of the residents. This is as a result of the country’s effort to improve the development of the chemical industry, manage safe production and curb environmental pollution accidents effectively, and ensure the quality of the living environment of residents. All chemical enterprises which do not comply with the requirements of the safety and environmental protection regulations will be ordered to shut down. The Company believes this relocation process will cost approximately $60 million in total. The Company incurred relocation costs comprising prepaid land lease and professional fees related to the design of the new chemical factory in the amount of $10,925,081, which were recorded in the prepaid land leases and property, plant and equipment in the consolidated balance sheets as of September 30, 2019 and December 31, 2018. The Company does not anticipate that the Company’s new chemical factory to be significantly impacted by the Notice. The Company has secured from the government the land use rights for its chemical plants located at the Bohai Park and presented a completed construction design draft and other related documents to the local authorities for approval. The Company is still waiting for the last approval report and is uncertain when the approval will be issued. There could be a delay in the approval process given the ongoing rectification and approvals process for the Company’s other plants. As the construction of the new factory cannot commence until the final approval from the government is received, the delay in the receipt of the final approval will delay the commencement date of the construction of the new factory. (iii) Natural Gas Segment In January 2017, the Company completed the first brine water and natural gas well field construction in Daying located in Sichuan Province and commenced trial production in January 2019. On May 29, 2019, the Company received a verbal notice from the government of Tianbao Town ,Daying County, Sichuan Province, whereby the Company is required to obtain project approval for its well located in Daying, including the whole natural gas and brine water project, and approvals for safety production inspection, environmental protection assessment, and to solve the related land issue. Until these approvals have been received, the Company has to temporarily halt trial production at its natural gas well in Daying.
Allowance for Doubtful Accounts	As of September 30, 2019 and December 31, 2018, There were no allowances for doubtful accounts. No allowances for doubtful accounts were charged to the condensed consolidated statements of loss for the three-month and nine-month periods ended September 30, 2019 and 2018.
Concentration of Credit Risk	The Company is exposed to credit risk in the normal course of business, primarily related to accounts receivable and cash and cash equivalents. Substantially all of the Company’s cash and cash equivalents are maintained with financial institutions in the PRC, namely, Industrial and Commercial Bank of China Limited, China Merchants Bank Company Limited and Sichuan Rural Credit Union, which are not insured or otherwise protected. The Company placed $105,218,569 and $178,998,935 with these institutions as of September 30, 2019 and December 31, 2018, respectively. The Company has not experienced any losses in such accounts in the PRC. Concentrations of credit risk with respect to accounts receivable exists as the Company sells a substantial portion of its products to a limited number of customers. However, such concentrations of credit risks are limited since the Company performs ongoing credit evaluations of its customers’ financial condition and extends credit terms as and when appropriate. As of September 30, 2019, proceeds from accounts receivable balance outstanding of $0.58 million was collected in October 2019, In the amount collected, $0.47 million was for receivable more than 90 days old. As of December 31, 2018, there were no accounts receivable balances as they were all collected in the year ended December 31, 2018.
Property, Plant and Equipment	Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Expenditures for new facilities or equipment, and major expenditures for betterment of existing facilities or equipment are capitalized and depreciated, when available for intended use, using the straight-line method at rates sufficient to depreciate such costs less 5% residual value over the estimated productive lives. All other ordinary repair and maintenance costs are expensed as incurred. Mineral rights are recorded at cost less accumulated depreciation and any impairment losses. Mineral rights are amortized ratably over the term of the lease, or the equivalent term under the units of production method, whichever is shorter. Construction in process primarily represents direct costs of construction of property, plant and equipment. Costs incurred are capitalized and transferred to property, plant and equipment upon completion and depreciation will commence when the completed assets are placed in service. The Company’s depreciation and amortization policies on property, plant and equipment, other than mineral rights and construction in process, are as follows: Useful life (in years) Buildings (including salt pans) 8 - 20 Plant and machinery (including protective shells, transmission channels and ducts) 3 - 8 Motor vehicles 5 Furniture, fixtures and equipment 3-8 Property, plant and equipment under the finance lease are depreciated over their expected useful lives on the same basis as owned assets, or where shorter, the term of the lease, which is 20 years. Producing oil and gas properties are depreciated on a unit-of-production basis over the proved developed reserves. Common facilities that are built specifically to service production directly attributed to designated oil and gas properties are depreciated based on the proved developed reserves of the respective oil and gas properties on a pro-rata basis. Common facilities that are not built specifically to service identified oil and gas properties are depreciated using the straight-line method over their estimated useful lives. Costs associated with significant development projects are not depreciated until commercial production commences and the reserves related to those costs are excluded from the calculation of depreciation.
Retirement Benefits	Pursuant to the relevant laws and regulations in the PRC, the Company participates in a defined contribution retirement plan for its employees arranged by a governmental organization. The Company makes contributions to the retirement plan at the applicable rate based on the employees’ salaries. The required contributions under the retirement plans are charged to the condensed consolidated statement of loss on an accrual basis when they are due. The Company’s contributions totaled $207,175 and $308,669 for the three-month period ended September 30, 2019 and 2018, respectively, and totaled $810,911 and $912,744 for the nine-month period ended September 30, 2019 and 2018, respectively.
Revenue Recognition	Net revenue is net of discount and value added tax and comprises the sale of bromine, crude salt and chemical products. Revenue is recognized when the control of the promised goods is transferred to the customers in an amount that reflects the consideration that the Company expects to receive from the customers in exchange for those goods. The acknowledgement of receipt of goods by the customers is when control of the product is deemed to be transferred. Invoicing occurs upon acknowledgement of receipt of the goods by the customers. Customers have no rights to return the goods upon acknowledgement of receipt of goods.
Recoverability of Long-lived Assets	In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360-10-35 “Impairment or Disposal of Long-lived Assets” The Company determines the existence of such impairment by measuring the expected future cash flows (undiscounted and without interest charges) and comparing such amount to the carrying amount of the assets. An impairment loss, if one exists, is then measured as the amount by which the carrying amount of the asset exceeds the discounted estimated future cash flows. Assets to be disposed of are reported at the lower of the carrying amount or fair value of such assets less costs to sell. Asset impairment charges are recorded to reduce the carrying amount of the long-lived asset that will be sold or disposed of to their estimated fair values. Charges for the asset impairment reduce the carrying amount of the long-lived assets to their estimated salvage value in connection with the decision to dispose of such assets. For the three and nine months period ended September 30, 2019, the Company determined that there were no events or circumstances indicating possible impairment of its long-lived assets. In the three and nine- month periods ended September 30, 2018, the Company recorded an impairment loss of $1,284,832 for the mineral rights for factories No 3 and No 4 due to closure notice from the People's Government of Yangkou Town, Shouguang City and a write-off of $112,481 for write-offs of certain wells and equipments damaged by flood from a typhoon during third quarter 2018.
Basic and Diluted Earnings per Share of Common Stock	Basic earnings per common share are based on the weighted average number of shares outstanding during the periods presented. Diluted earnings per share are computed using weighted average number of common shares plus dilutive common share equivalents outstanding during the period. Potential common shares that would have the effect of increasing diluted earnings per share are considered to be anti-dilutive, i.e. the exercise prices of the outstanding stock options were greater than the market price of the common stock. Anti-dilutive common stock equivalents which were excluded from the calculation of number of dilutive common stock equivalents amounted to 587,720 and 259,590 shares for the three-month period ended September 30, 2019 and 2018, respectively, and amounted to 362,206 and 141,629 shares for the nine-month period ended September 30, 2019 and 2018, respectively. These awards could be dilutive in the future if the market price of the common stock increases and is greater than the exercise price of these awards. Because the Company reported a net loss for the three and nine months ended September 30, 2019 and 2018, common stock equivalents including stock options and warrants were anti-dilutive, therefore the amounts reported for basic and diluted loss per share were the same.
Reporting Currency and Translation	The financial statements of the Company’s foreign subsidiaries are measured using the local currency, Renminbi (“RMB”), as the functional currency; whereas the functional currency and reporting currency of the Company is the United States dollar (“USD” or “$”). As such, the Company uses the “current rate method” to translate its PRC operations from RMB into USD, as required under FASB ASC 830 “Foreign Currency Matters”. The assets and liabilities of its PRC operations are translated into USD using the rate of exchange prevailing at the balance sheet date. The capital accounts are translated at the historical rate. Adjustments resulting from the translation of the balance sheets of the Company’s PRC subsidiaries are recorded in stockholders’ equity as part of accumulated other comprehensive loss. The statement of loss and comprehensive loss is translated at average rate during the reporting period. Gains or losses resulting from transactions in currencies other than the functional currencies are recognized in net loss for the reporting periods as part of general and administrative expense. The statement of cash flows is translated at average rate during the reporting period, with the exception of the consideration paid for the acquisition of business which is translated at historical rates.
Foreign Operations	All of the Company’s operations and assets are located in PRC. The Company may be adversely affected by possible political or economic events in this country. The effect of these factors cannot be accurately predicted.
Exploration Costs	Exploration costs, which included the cost of researching appropriate places to drill wells and the cost of well drilling in search of potential natural brine or other resources, are charged to the loss statement as incurred. Once the commercial viability of a project has been confirmed, all subsequent costs are capitalized. For oil and gas properties, the successful efforts method of accounting is adopted. The Company carries exploratory well costs as an asset when the well has found a sufficient quantity of reserves to justify its completion as a producing well and where the Company is making sufficient progress assessing the reserves and the economic and operating viability of the project. Exploratory well costs not meeting these criteria are charged to expenses. Exploratory wells that discover potentially economic reserves in areas where major capital expenditure will be required before production would begin and when the major capital expenditure depends upon the successful completion of further exploratory work remain capitalized and are reviewed periodically for impairment.
Leases	The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. Finance leases are included in finance lease ROU assets and finance lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease and finance lease ROU assets and liabilities are recognized at January 1, 2019 based on the present value of lease payments over the lease term discounted using the rate implicit in the lease. In cases where the implicit rate is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Stock-based Compensation	Common stock, stock options and stock warrants issued are recorded at their fair values estimated at grant date using the Black-Scholes model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The Company has elected to account for the forfeiture of stock-based awards as they occur.
New Accounting Pronouncements	Recent accounting pronouncements adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The amendments in this Update specify the accounting for leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from operating leases. The Company adopted the standard effective January 1, 2019 under the optional transition method which allows an entity to apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment, if any, to the opening balance of retained earnings in the period of adoption. The Company elected the available practical expedients. As a result of the adoption of this standard, the Company recognized operating lease ROU assets of $8,817,327, operating lease liabilities of $8,137,541, and the remaining balance in the prepaid land lease and accrued expense in the condensed consolidated financial statements as of and for the nine months ended September 30, 2019 with no cumulative-effect adjustment to retained earnings as of January 1, 2019. In June 2018, the FASB issued ASU No.2018-07, Compensation- Stock Compensation (Topic 718). Improvements to Nonemployee Share-Based Payment Accounting. The amendments in this update expand the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. Prior to this update, Topic 718 applied only to share-based transactions to employees. Consistent with the accounting requirements for employee share-based payment awards, nonemployee share-based payment awards within the scope of Topic 718 are measured at grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. The amendments in the Update are effective for public business entities form fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Company adopted this standard as of January 1, 2019. This adoption of this standard does not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. The amendments in this Update affect loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. The ASU requires an entity to recognize expected credit losses rather than incurred losses for financial assets. For public entities, the amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the effect of this on the condensed consolidated financial statements and related disclosure.

1. BASIS OF PRESENTATION AND _3

1. BASIS OF PRESENTATION AND CONSOLIDATION (Tables)	9 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Schedule of property plant and equipment useful life	Useful life (in years) Buildings (including salt pans) 8 - 20 Plant and machinery (including protective shells, transmission channels and ducts) 3 - 8 Motor vehicles 5 Furniture, fixtures and equipment 3-8

2. INVENTORIES (Tables)

2. INVENTORIES (Tables)	9 Months Ended
	Sep. 30, 2019
Inventory Disclosure [Abstract]
Inventories	September 30, 2019 December 31, 2018 Raw materials $ 20,642 $ - Finished goods 660,008 65,169 Allowance for obsolete and slow-moving inventory - (65,169 ) $ 680,650 $ -

4. PROPERTY, PLANT AND EQUIPM_2

4. PROPERTY, PLANT AND EQUIPMENT, NET (Tables)	9 Months Ended
	Sep. 30, 2019
Property, Plant and Equipment [Abstract]
Property, plant and equipment	September 30, 2019 December 31, 2018 At cost: Mineral rights $ 2,726,661 $ 2,809,977 Buildings 59,061,773 60,866,462 Plant and machinery 231,460,194 161,178,816 Motor vehicles 6,045 6,230 Furniture, fixtures and office equipment 3,191,491 3,289,010 Construction in process 1,188,268 6,535,808 Total 297,634,432 234,686,303 Less: Accumulated depreciation and amortization (140,889,652) (134,681,628 ) Impairment (17,196,587) (17,722,045 ) Net book value $ 139,548,193 $ 82,282,630

5. FINANCE LEASE RIGHT-OF-USE_2

5. FINANCE LEASE RIGHT-OF-USE ASSETS (Tables)	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
Property, plant and equipment under capital leases	September 30, 2019 December 31, 2018 At cost: Buildings $ 116,344 $ 119,899 Plant and machinery 2,128,342 2,193,375 Total 2,244,686 2,313,274 Less: Accumulated depreciation and amortization (2,066,305) (2,062,517 ) Net book value $ 178,381 $ 250,757

7. OTHER PAYABLE AND ACCRUED _2

7. OTHER PAYABLE AND ACCRUED EXPENSE (Tables)	9 Months Ended
	Sep. 30, 2019
Payables and Accruals [Abstract]
Other payable and accrued expenses	September 30, December 31, 2019 2018 Accounts payable $ - $ - Salary payable 308,181 241,343 Social security insurance contribution payable 104,480 140,326 Other payable-related party (see Note 8) 66,151 90,900 Deposit on subscription of a subsidiary's share 141,380 - Accrued expense-for repair work 2,912,355 104,246 Accrued expense-others 337,969 328,443 Total $ 3,870,516 $ 905,258

9. TAXES PAYABLE (Tables)

9. TAXES PAYABLE (Tables)	9 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Taxes payable	September 30, December 31, 2019 2018 Land use tax payable $ 768,962 $ 1,188,687 Value-added tax withheld from suppliers 2,977,283 - Other tax payable 274,547 - $ 4,020,792 $ 1,188,687

10. LEASE LIABILITIES-FINANCE_2

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE (Tables)	9 Months Ended
	Sep. 30, 2019
Leases [Abstract]
Finance lease obligations	Imputed September 30, December 31, Interest rate 2019 2018 Total finance lease liability 6.7% $ 2,041,845 $ 2,267,025 Less: Current portion (162,132 ) (197,480 ) Finance lease liability, net of current portion $ 1,879,713 $ 2,069,545
Components of operating lease liabilities	Imputed September 30, December 31, Interest rate 2019 2018 Total Operating lease liabilities 4.89% $ 8,137,541 $ - Less: Current portion (406,156 ) - Operating lease liabilities, net of current portion $ 7,731,385 $ -
Maturities of lease liabilities	Financial lease Operating Lease Payable within: the next 12 months $ 265,370 $ 762,298 the next 13 to 24 months 265,370 775,828 the next 25 to 36 months 265,370 628,579 the next 37 to 48 months 265,370 635,341 the next 49 to 60 months 265,370 633,168 thereafter 1,592,225 11,285,715 Total 2,919,075 14,720,929 Less: Amount representing interest (877,230 ) (6,583,388 ) Present value of net minimum lease payments $ 2,041,845 $ 8,137,541

13. STOCK-BASED COMPENSATION (T

13. STOCK-BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2019
Share-based Payment Arrangement [Abstract]
Schedule of stock option transactions	Number of Option and Warrants Outstanding and exercisable Weighted- Average Exercise price of Option and Warrants Range of Exercise Price per Common Share Balance, January 1, 2019 2,518,000 $0.97 $0.71 - $4.80 Granted and vested during the period ended September 30, 2019 150,000 $0.91 $0.91 Exercised during the period ended September 30, 2019 (1,897,000) $0.73 $0.73 Expired/cancelled during the period ended September 30, 2019 (65,500) $2.31 $2.61 Balance, September 30, 2019 705,500 $1.47 $0.71 - $2.10
Schedule of stock and warrants options outstanding	Stock and Warrants Options Exercisable and Outstanding Weighted Average Remaining Outstanding at September 30, 2019 Range of Exercise Prices Contractual Life (Years) Exercisable and outstanding 705,500 $0.71 - $2.10 1.74

14. INCOME TAXES (Tables)

14. INCOME TAXES (Tables)	9 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Schedule of components of the provision for income taxes	Three-Month Period Ended September 30, Nine-Month Period Ended September 30, 2019 2018 2019 2018 Current taxes – PRC $ - $ - $ - $ - Deferred taxes – PRC 1,650,132 7,205,521 3,756,199 10,338,103 Change in valuation allowance (8,379,571) (24,000) (8,724,517) (79,595) $ (6,729,439) $ 7,181,521 $ (4,968,318) $ 10,258,508
Schedule of income tax expenses reconciliation	Three-Month Period Ended September 30, Nine-Month Period Ended September 30, Reconciliations 2019 2018 2019 2018 Statutory income tax rate 25 % 25 % 25 % 25 % Non-taxable income 1 % 2 % 2 % - Change in valuation allowance (133 %) - (63 %) - Effective income tax benefit (expense) rate (107 %) 27 % (36 %) 25 %
Schedule of deferred tax assets and liabilities	September 30, December 31, 2019 2018 Deferred tax liabilities $ - $ - Deferred tax assets: Allowance for obsolete and slow-moving inventories $ - $ 16,292 Impairment on property, plant and equipment 3,197,763 3,696,332 Impairment on prepaid land lease 815,370 840,284 Exploration costs 1,760,181 1,813,965 Compensation costs of unexercised stock options 171,672 194,016 PRC tax losses 16,043,972 12,663,985 US federal net operating loss and foreign tax credit 508,102 119,000 Total deferred tax assets 22,497,060 19,343,874 Valuation allowance (9,037,533) (313,016 ) Net deferred tax asset $ 13,459,527 $ 19,030,858

15. BUSINESS SEGMENTS (Tables)

15. BUSINESS SEGMENTS (Tables)	9 Months Ended
	Sep. 30, 2019
Segment Reporting [Abstract]
Schedule of segment operating income	Three-Month Period Ended September 30, 2019 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue (external customers) $ 4,270,863 $ 277,679 $ — $ — $ 4,548,542 $ — $ 4,548,542 Net revenue (intersegment) — — — — — — — Income(loss) from operations before income tax benefit (5,185,484 ) (1,001,988 ) (744,963 ) (62,265 ) (6,994,700 ) 628,291 (6,366,409 ) Income tax (expense) benefit (5,778,726 ) (1,116,620 ) 165,907 — (6,729,439 ) — (6,729,439 ) Income(loss) from operations after income tax benefit (10,964,210 ) (2,118,608 ) (579,056 ) (62,265 ) (13,724,139 ) 628,291 (13,095,848 ) Total assets 153,825,697 21,738,770 110,464,372 1,767,155 287,795,994 150,836 287,946,830 Depreciation and amortization 3,303,155 182,538 113,357 35,081 3,634,131 — 3,634,131 Capital expenditures 56,137,239 1,180,129 — — 57,317,368 — 57,317,368 Three-Month Period Ended September 30, 2018 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue (external customers) $ — $ 343,080 $ — $ — $ 343,080 $ — $ 343,080 Net revenue (intersegment) — — — — — — — Income(loss) from operations before income tax benefit (24,369,917 ) (2,611,203 ) (698,693 ) (32,079 ) (27,711,892 ) 912,975 (26,798,917 ) Income tax benefit 4,774,432 2,171,383 235,706 — 7,181,521 — 7,181,521 Income (loss) from operations after income tax benefit (19,595,485 ) (439,820 ) (462,987 ) (32,079 ) (20,530,371 ) 912,975 (19,617,396 ) Total assets 119,939,092 39,297,116 175,343,915 1,903,319 336,483,442 16,927 336,500,369 Depreciation and amortization 3,948,751 600,912 116,549 — 4,666,212 — 4,666,212 Capital expenditures 936,598 142,529 — — 1,079,127 — 1,079,127 Goodwill — — 27,902,709 — 27,902,709 — 27,902,709 * Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of respective segment. Nine -Month Period Ended September 30, 2019 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue (external customers) $ 10,022,027 $ 522,758 $ — $ 51,736 $ 10,596,521 $ — $ 10,596,521 Net revenue (intersegment) — — — — — — — Income(loss) from operations before income tax benefit (8,847,210 ) (3,242,534 ) (2,074,937 ) (165,649 ) (14,330,330 ) 369,725 (13,960,605 ) Income tax (expense) benefit (4,871,839 ) (548,308 ) 451,828 — (4,968,319 ) — (4,968,319 ) Income(loss) from operations after income tax benefit (13,719,049 ) (3,790,842 ) (1,623,109 ) (165,649 ) (19,298,649 ) 369,725 (18,928,924 ) Total assets 153,825,697 21,738,770 110,464,372 1,767,155 287,795,994 150,836 287,946,830 Depreciation and amortization 8,442,421 1,701,769 346,985 107,836 10,599,011 — 10,599,011 Capital expenditures 56,137,239 1,180,129 — — 57,317,368 — 57,317,368 Nine -Month Period Ended September 30, 2018 Bromine* Crude Salt* Chemical Products Natural Gas Segment Total Corporate Total Net revenue (external customers) $ — $ 1,981,573 $ 613,368 $ — $ 2,594,941 $ — $ 2,594,941 Net revenue (intersegment) — — — — — — — Income(loss) from operations before income tax benefit (35,537,744 ) (5,150,679 ) (2,101,059 ) (113,029 ) (42,902,511 ) 975,007 (41,927,504 ) Income tax benefit 7,745,098 2,613,721 (100,311 ) — 10,258,508 — 10,258,508 Income (loss) from operations after income tax benefit (27,792,646 ) (2,536,958 ) (2,201,370 ) (113,029 ) (32,644,003 ) 975,007 (31,668,996 ) Total assets 119,939,092 39,297,116 175,343,915 1,903,319 336,483,442 16,927 336,500,369 Depreciation and amortization 11,686,782 2,125,762 365,183 — 14,177,727 — 14,177,727 Capital expenditures 8,843,486 1,345,783 1,192,963 30,616 11,412,848 — 11,412,848 Goodwill — — 27,902,709 — 27,902,709 — 27,902,709 * Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of the respective segment.
Schedule of segment costs	Three-Month Period Ended September 30, Nine-Month Period Ended September 30, Reconciliations 2019 2018 2019 2018 Total segment operating loss $ (6,994,700) $ (27,711,892) $ (14,330,330) $ (42,902,511) Corporate costs (105,702) (116,254) (408,695) (399,308) Unrealized gain on translation of intercompany balance 733,993 1,029,229 778,420 1,374,315 Loss from operations (6,366,409) (26,798,917) (13,960,605) (41,927,504) Other income, net of expense 66,820 124,362 258,052 385,989 Loss before taxes $ (6,299,589) $ (26,674,555) $ (13,702,553) $ (41,541,515)
Schedule of major customers	The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 2019. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ 843 $ 103 $ — $ 946 20.8 % 2 Shouguang Weidong Chemical Company Limited $ 529 $ 84 $ — $ 613 13.5 % 3 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ 500 $ 90 $ — $ 590 13 % 4 Dongying Bomeite Chemical Company Limited $ 557 $ — $ — $ 557 12.2 % 5 Shandong Shouguang Shenrunfa Ocean Chemical Company Limited $ 525 $ — $ — $ 525 11.5 % The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 2019. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ 2,203 $ 175 $ — $ 2,378 22.6 % 2 Shouguang Weidong Chemical Company Limited $ 1,629 $ 154 $ — $ 1,783 16.9 % 3 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ 1,539 $ 192 $ — $ 1,731 16.4 % 4 Dongying Bomeite Chemical Company Limited $ 1,098 $ — $ — $ 1,098 10.4 % 5 Shandong Shouguang Shenrunfa Ocean Chemical Company Limited $ 1,297 $ — $ — $ 1,297 12.3 % The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 2018. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ — $ 122 $ — $ 122 35 % 2 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ — $ 112 $ — $ 112 33 % 3 Shouguang Weidong Chemical Company Limited $ — $ 109 $ — $ 109 32 % The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 2018. Number Customer Bromine (000’s) Crude Salt (000’s) Chemical Products (000’s) Total Revenue (000’s) Percentage of Total Revenue (%) 1 Shandong Morui Chemical Company Limited $ — $ 656 $ 155 $ 811 31 % 2 Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited $ — $ 783 $ — $ 783 30 % 3 Shouguang Weidong Chemical Company Limited $ — $ 543 $ — $ 543 21 %

19. CAPITAL COMMITMENT AND OP_2

19. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS (Tables)	9 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Schedule of contractual obligations	Property Management Fees Capital Expenditure Payable within: the next 12 months $ 88,202 $ 25,448 the next 13 to 24 months 88,202 — the next 25 to 36 months 88,202 — the next 37 to 48 months 88,202 — Total $ 352,808 $ 25,448

1. BASIS OF PRESENTATION AND SU

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	9 Months Ended
	Sep. 30, 2019
Building | Minimum
Property, plant and equipment, useful life	8 years
Building | Maximum
Property, plant and equipment, useful life	20 years
Plant And Machinery | Minimum
Property, plant and equipment, useful life	3 years
Plant And Machinery | Maximum
Property, plant and equipment, useful life	8 years
Vehicles
Property, plant and equipment, useful life	5 years
Furniture, Fixtures And Equipment | Minimum
Property, plant and equipment, useful life	3 years
Furniture, Fixtures And Equipment | Maximum
Property, plant and equipment, useful life	8 years

1. BASIS OF PRESENTATION AND _4

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Accounting Policies [Abstract]
Allowances for doubtful accounts	$ 0		$ 0		$ 0
Contributions to the retirement plan	$ 207,175	$ 308,669	$ 810,911	$ 912,744
Anti-dilutive common stock equivalents which were excluded	587,720	259,590	362,206	141,629

2. INVENTORIES (Details)

2. INVENTORIES (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Raw materials	$ 20,642	$ 0
Finished goods	660,008	65,169
Allowance for obsolete and slow-moving inventory	0	(65,169)
Inventories	$ 680,650	$ 0

3. PREPAID LAND LEASE (Details

3. PREPAID LAND LEASE (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Prepaid Land Leases
Amortization of prepaid land lease	$ 0	$ 252,091	$ 0	$ 546,767
Parcels of land of which the Company could not obtain land use rights certificates					The parcels of land of which the Company cannot obtain land use rights certificates cover a total of approximately 38.6 square kilometers of aggregate carrying value of $599,747 as at December 31, 2018.

4. PROPERTY, PLANT AND EQUIPM_3

4. PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Mineral rights	$ 2,726,661	$ 2,809,977
Buildings	59,061,773	60,866,462
Plant and machinery	231,460,194	161,178,816
Motor vehicles	6,045	6,230
Furniture, fixtures and office equipment	3,191,491	3,289,010
Construction in progress	1,188,268	6,535,808
Total	297,634,432	234,686,303
Less: accumulated depreciation and amortization	(140,889,652)	(134,681,628)
Impairment	(17,196,587)	(17,722,045)
Net book value	$ 139,548,193	$ 82,282,630

4. PROPERTY, PLANT AND EQUIPM_4

4. PROPERTY, PLANT AND EQUIPMENT, NET (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Land	$ 19,881,983		$ 19,881,983		$ 20,409,998
Depreciation and amortization expense	3,632,805	$ 4,601,338	10,530,985	$ 13,974,456
Direct labor and factory overheads incurred during plant shutdown	2,449,352	4,353,824	7,535,376	13,210,971
Cost of administrative expenses	201,182	$ 247,514	648,456	$ 763,485
Cost of net revenue	$ 982,271		$ 2,347,153

5. FINANCE LEASE RIGHT-OF-USE_3

5. FINANCE LEASE RIGHT-OF-USE ASSETS (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
At cost	$ 2,244,686	$ 2,313,274
Less: accumulated depreciation and amortization	(2,066,305)	(2,062,517)
Net book value	178,381	250,757
Building
At cost	116,344	119,899
Plant and machinery
At cost	$ 2,128,342	$ 2,193,375

5. FINANCE LEASE RIGHT-OF-USE_4

5. FINANCE LEASE RIGHT-OF-USE ASSETS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Leases [Abstract]
Depreciation and amortization expense	$ 1,326	$ 64,874	$ 68,027	$ 203,271

6. OPERATING LEASE RIGHT-OF-U_2

6. OPERATING LEASE RIGHT-OF-USE ASSETS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Leases [Abstract]
Operating lease ROU assets	$ 8,817,327		$ 8,817,327		$ 0
Operating lease cost	$ 219,411	$ 266,875	$ 671,652	$ 831,539

7. OTHER PAYABLE AND ACCRUED _3

7. OTHER PAYABLE AND ACCRUED EXPENSE (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Accounts payable	$ 0	$ 0
Salary payable	308,181	241,343
Social security insurance contribution payable	104,480	140,326
Other payable-related party (see Note 8)	66,151	90,900
Deposit on subscription of a subsidiary's share	141,380	0
Accrued expense-for repair work	2,912,355	104,246
Accrued expense-others	337,969	328,443
Total	$ 3,870,516	$ 905,258

8. RELATED PARTY TRANSACTIONS (

8. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Related Party Transactions [Abstract]
Company borrowed from Jiaxing Lighting Appliance Company Limited	$ 299,995
Property management services provided by Shandong Shouguang Vegetable Seed Industry Group Co., Ltd	$ 22,050	$ 23,000	$ 67,900	$ 72,000

9. TAXES PAYABLE (Details)

9. TAXES PAYABLE (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Land use right tax payable	$ 768,962	$ 1,188,687
Value-added tax withheld from suppliers	2,977,283	0
Other tax payable	274,547	0
Taxes payable	$ 4,020,792	$ 1,188,687

10. LEASE LIABILITIES-FINANCE_3

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Leases [Abstract]
Imputed interest rate on capital lease obligations	6.70%
Total capital lease obligations	$ 2,041,845	$ 2,267,025
Less: current portion	(162,132)	(197,480)
Capital lease obligations, net of current portion	$ 1,879,713	$ 2,069,545

10. LEASE LIABILITIES-FINANCE_4

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE (Details 1)	Sep. 30, 2019USD ($)	Dec. 31, 2018USD ($)
Leases [Abstract]
Imputed interest rate on operating lease liabilities	.0489
Total operating lease liabilities	$ 8,137,541	$ 0
Less: current portion	(406,156)	0
Operating lease liabilities, net of current portion	$ 7,731,385	$ 0

10. LEASE LIABILITIES-FINANCE_5

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE (Details 2) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Capital Lease Obligations Payable within:
the next 12 months	$ 265,370
the next 13 to 24 months	265,370
the next 25 to 36 months	265,370
the next 37 to 48 months	265,370
the next 49 to 60 months	265,370
thereafter	1,592,225
Total	2,919,075
Less: amount representing interest	(877,230)
Present value of net minimum lease payments	2,041,845
Operating Lease Obligations
the next 12 months	762,298
the next 13 to 24 months	775,828
the next 25 to 36 months	628,579
the next 37 to 48 months	635,341
the next 49 to 60 months	633,168
thereafter	11,285,715
Total	14,720,929
Less: amount representing interest	(6,583,388)
Present value of net minimum lease payments	$ 8,137,541	$ 0

10. LEASE LIABILITIES-FINANCE_6

10. LEASE LIABILITIES-FINANCE AND OPERATING LEASE (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Leases [Abstract]
Interest expense from capital lease obligations	$ 34,080	$ 37,138	$ 111,020	$ 123,352
Weighted average remaining operating lease term	23 years		23 years
Weighted average discounts rate	4.89%		4.89%

11. EQUITY (Details Narrative)

11. EQUITY (Details Narrative)	9 Months Ended
	Sep. 30, 2019
Equity [Abstract]
Statutory common reserve funds description	The Statutory Common Reserve Fund as of September 30, 2019 for SCHC, SYCI and DCHC is 46%, 14% and 0% of its registered capital respectively.

13. STOCK-BASED COMPENSATION (D

13. STOCK-BASED COMPENSATION (Details)	9 Months Ended
	Sep. 30, 2019$ / sharesshares
Share-based Payment Arrangement [Abstract]
Number of option and warrants outstanding, beginning balance | shares	2,518,000
Number of option and warrants granted and vested | shares	150,000
Number of option and warrants exercised | shares	(1,897,000)
Number of option and warrants expired | shares	(65,500)
Number of option and warrants outstanding, ending balance | shares	705,500
Weighted-average exercise price of option and warrants, beginning balance | $ / shares	$ .97
Weighted-average exercise price of option and warrants granted and vested during the period | $ / shares	.91
Weighted-average exercise price of option and warrants exercised | $ / shares	.73
Weighted-average exercise price of option and warrants expired | $ / shares	2.31
Weighted-average exercise price of option and warrants, ending balance | $ / shares	$ 1.47
Range of exercise price per common share, beginning balance	$0.71 - $4.80
Range of exercise price per common share granted and vested	$0.91
Range of exercise price per common share exercised	$0.73
Range of exercise price per common share expired	$2.61
Range of exercise price per common share, ending balance	$0.71 - $2.10

13. STOCK-BASED COMPENSATION _2

13. STOCK-BASED COMPENSATION (Details 1) - $ / shares	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Share-based Payment Arrangement [Abstract]
Outstanding	705,500	2,518,000
Range of exercise prices, lower limit	$ .71
Range of exercise prices, upper limit	$ 2.10
Weighted average remaining contractual life (years)	1 year 8 months 27 days

13. STOCK-BASED COMPENSATION _3

13. STOCK-BASED COMPENSATION (Details Narrative)	9 Months Ended
	Sep. 30, 2019USD ($)shares
Share-based Payment Arrangement [Abstract]
Common stock available for issuance | shares	4,920,989
Aggregate intrinsic value of options outstanding and exercisable | $	$ 0

14. INCOME TAXES (Details)

14. INCOME TAXES (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Current taxes - PRC	$ 0	$ 0	$ 0	$ 0
Deferred taxes - PRC	1,650,132	7,205,521	3,756,199	10,338,103
Change in valuation allowance	(8,379,571)	(24,000)	(8,724,517)	(79,595)
Income taxes	$ (6,729,439)	$ 7,181,521	$ (4,968,318)	$ 10,258,508

14. INCOME TAXES (Details 1)

14. INCOME TAXES (Details 1)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Statutory income tax rate	25.00%	25.00%	25.00%	25.00%
Non-taxable income	1.00%	2.00%	2.00%	0.00%
Change in valuation allowance	(133.00%)	0.00%	(63.00%)	0.00%
Effective income tax benefit (expense) rate	(107.00%)	27.00%	(36.00%)	25.00%

14. INCOME TAXES (Details 2)

14. INCOME TAXES (Details 2) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Deferred tax liabilities	$ 0	$ 0
Deferred tax assets:
Allowance for obsolete and slow-moving inventories	0	16,292
Impairment on property, plant and equipment	3,197,763	3,696,332
Impairment on prepaid land lease	815,370	840,284
Exploration costs	1,760,181	1,813,965
Compensation costs of unexercised stock options	171,672	194,016
PRC tax losses	16,043,972	12,663,985
US federal net operating loss and foreign tax credit	508,102	119,000
Total deferred tax assets	22,497,060	19,343,874
Valuation allowance	(9,037,533)	(313,016)
Net deferred tax asset	$ 13,459,527	$ 19,030,858

15. BUSINESS SEGMENTS (Details)

15. BUSINESS SEGMENTS (Details) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Net revenue (external customers)		$ 4,548,542	$ 343,080	$ 10,596,521	$ 2,594,941
Net revenue (intersegment)		0	0	0	0
Income (loss) from operations before income tax benefit		(6,366,409)	(26,798,917)	(13,960,605)	(41,927,504)
Income tax (expense) benefit		(6,729,439)	7,181,521	(4,968,318)	10,258,508
Income (loss) from operations after income taxes benefit		(13,095,848)	(19,617,396)	(18,928,924)	(31,668,996)
Total assets		287,946,830	336,500,369	287,946,830	336,500,369
Depreciation and amortization		3,634,131	4,666,212	10,599,011	14,177,727
Capital expenditures		57,317,368	1,079,127	57,317,368	11,412,848
Goodwill			27,902,709		27,902,709
Bromine Segment
Net revenue (external customers)	[1]	4,270,863	0	10,022,027	0
Net revenue (intersegment)	[1]	0	0	0	0
Income (loss) from operations before income tax benefit	[1]	(5,185,484)	(24,369,917)	(8,847,210)	(35,537,744)
Income tax (expense) benefit	[1]	(5,778,726)	4,774,432	(4,871,839)	7,745,098
Income (loss) from operations after income taxes benefit	[1]	(10,964,210)	(19,595,485)	(13,719,049)	(27,792,646)
Total assets	[1]	153,825,697	119,939,092	153,825,697	119,939,092
Depreciation and amortization	[1]	3,303,155	3,948,751	8,442,421	11,686,782
Capital expenditures	[1]	56,137,239	936,598	56,137,239	8,843,486
Goodwill	[1]		0		0
Crude Salt Segment
Net revenue (external customers)	[1]	277,679	343,080	522,758	1,981,573
Net revenue (intersegment)	[1]	0	0	0	0
Income (loss) from operations before income tax benefit	[1]	(1,001,988)	(2,611,203)	(3,242,534)	(5,150,679)
Income tax (expense) benefit	[1]	(1,116,620)	2,171,383	(548,308)	2,613,721
Income (loss) from operations after income taxes benefit	[1]	(2,118,608)	(439,820)	(3,790,842)	(2,536,958)
Total assets	[1]	21,738,770	39,297,116	21,738,770	39,297,116
Depreciation and amortization	[1]	182,538	600,912	1,701,769	2,125,762
Capital expenditures	[1]	1,180,129	142,529	1,180,129	1,345,783
Goodwill	[1]		0		0
Chemical Products Segment
Net revenue (external customers)		0	0	0	613,368
Net revenue (intersegment)		0	0	0	0
Income (loss) from operations before income tax benefit		(744,963)	(698,693)	(2,074,937)	(2,101,059)
Income tax (expense) benefit		165,907	235,706	451,828	(100,311)
Income (loss) from operations after income taxes benefit		(579,056)	(462,987)	(1,623,109)	(2,201,370)
Total assets		110,464,372	175,343,915	110,464,372	175,343,915
Depreciation and amortization		113,357	116,549	346,985	365,183
Capital expenditures		0	0	0	1,192,963
Goodwill			27,902,709		27,902,709
Natural Gas
Net revenue (external customers)		0	0	51,736	0
Net revenue (intersegment)		0	0	0	0
Income (loss) from operations before income tax benefit		(62,265)	(32,079)	(165,649)	(113,029)
Income tax (expense) benefit		0	0	0	0
Income (loss) from operations after income taxes benefit		(62,265)	(32,079)	(165,649)	(113,029)
Total assets		1,767,155	1,903,319	1,767,155	1,903,319
Depreciation and amortization		35,081	0	107,836	0
Capital expenditures		0	0	0	30,616
Goodwill			0		0
Segment Total
Net revenue (external customers)		4,548,542	343,080	10,596,521	2,594,941
Net revenue (intersegment)		0	0	0	0
Income (loss) from operations before income tax benefit		(6,994,700)	(27,711,892)	(14,330,330)	(42,902,511)
Income tax (expense) benefit		(6,729,439)	7,181,521	(4,968,319)	10,258,508
Income (loss) from operations after income taxes benefit		(13,724,139)	(20,530,371)	(19,298,649)	(32,644,003)
Total assets		287,795,994	336,483,442	287,795,994	336,483,442
Depreciation and amortization		3,634,131	4,666,212	10,599,011	14,177,727
Capital expenditures		57,317,368	1,079,127	57,317,368	11,412,848
Goodwill			27,902,709		27,902,709
Corporate
Net revenue (external customers)		0	0	0	0
Net revenue (intersegment)		0	0	0	0
Income (loss) from operations before income tax benefit		628,291	912,975	369,725	975,007
Income tax (expense) benefit		0	0	0	0
Income (loss) from operations after income taxes benefit		628,291	912,975	369,725	975,007
Total assets		150,836	16,927	150,836	16,927
Depreciation and amortization		0	0	0	0
Capital expenditures		$ 0	0	$ 0	0
Goodwill			$ 0		$ 0
[1]	Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of the respective segment.

15. BUSINESS SEGMENTS (Details

15. BUSINESS SEGMENTS (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Segment Reporting [Abstract]
Total segment operating loss	$ (6,994,700)	$ (27,711,892)	$ (14,330,330)	$ (42,902,511)
Corporate costs	(105,702)	(116,254)	(408,695)	(399,308)
Unrealized loss on translation of intercompany balance	733,993	1,029,229	778,420	1,374,315
Loss from operations	(6,366,409)	(26,798,917)	(13,960,605)	(41,927,504)
Other income, net of expense	66,820	124,362	258,052	385,989
Loss before income taxes	$ (6,299,589)	$ (26,674,555)	$ (13,702,553)	$ (41,541,515)

15. BUSINESS SEGMENTS (Detail_2

15. BUSINESS SEGMENTS (Details 2) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenues	$ 4,548,542	$ 343,080	$ 10,596,521	$ 2,594,941
Shandong Morui Chemical Company Limited
Revenues	$ 946,000	$ 122,000	$ 2,378,000	$ 811,000
Percentage of total revenue (%)	20.80%	35.00%	22.60%	31.00%
Shandong Morui Chemical Company Limited | Bromine Segment
Revenues	$ 843,000	$ 0	$ 2,203,000	$ 0
Shandong Morui Chemical Company Limited | Crude Salt Segment
Revenues	103,000	122,000	175,000	656,000
Shandong Morui Chemical Company Limited | Chemical Products Segment
Revenues	0	0	0	155,000
Shouguang Weidong Chemical Company Limited
Revenues	$ 613,000	$ 109,000	$ 1,783,000	$ 543,000
Percentage of total revenue (%)	13.50%	32.00%	16.90%	21.00%
Shouguang Weidong Chemical Company Limited | Bromine Segment
Revenues	$ 529,000	$ 0	$ 1,629,000	$ 0
Shouguang Weidong Chemical Company Limited | Crude Salt Segment
Revenues	84,000	109,000	154,000	543,000
Shouguang Weidong Chemical Company Limited | Chemical Products Segment
Revenues	0	0	0	0
Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited
Revenues	$ 590,000	$ 112,000	$ 1,731,000	$ 783,000
Percentage of total revenue (%)	13.00%	33.00%	16.40%	30.00%
Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited | Bromine Segment
Revenues	$ 500,000	$ 0	$ 1,539,000	$ 0
Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited | Crude Salt Segment
Revenues	90,000	112,000	192,000	783,000
Shandong Brother Technology Limited, Kuerle Xingdong Trading Limited | Chemical Products Segment
Revenues	0	$ 0	0	$ 0
Dongying Bomeite Chemical Company Limited
Revenues	$ 557,000		$ 1,098,000
Percentage of total revenue (%)	12.20%		10.40%
Dongying Bomeite Chemical Company Limited | Bromine Segment
Revenues	$ 557,000		$ 1,098,000
Dongying Bomeite Chemical Company Limited | Crude Salt Segment
Revenues	0		0
Dongying Bomeite Chemical Company Limited | Chemical Products Segment
Revenues	0		0
Shandong shouguang shenrunfa ocean Chemical Company
Revenues	$ 525,000		$ 1,297,000
Percentage of total revenue (%)	11.50%		12.30%
Shandong shouguang shenrunfa ocean Chemical Company | Bromine Segment
Revenues	$ 525,000		$ 1,297,000
Shandong shouguang shenrunfa ocean Chemical Company | Crude Salt Segment
Revenues	0		0
Shandong shouguang shenrunfa ocean Chemical Company | Chemical Products Segment
Revenues	$ 0		$ 0

16. CUSTOMER CONCENTRATION (Det

16. CUSTOMER CONCENTRATION (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Amounts due from major customers	$ 396,494	$ 8,834,543	$ 396,494
Top 5 customers
Percent products sold to top five customers	100.00%	78.50%	90.00%

19. CAPITAL COMMITMENT AND OP_3

19. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS (Details)	Sep. 30, 2019USD ($)
Property Management Fees
the next 12 months	$ 88,202
the next 13 to 24 months	88,202
the next 25 to 36 months	88,202
the next 37 to 48 months	88,202
Total	352,808
Capital Expenditure
the next 12 months	25,448
the next 13 to 24 months	0
the next 25 to 36 months	0
the next 37 to 48 months	0
Total	$ 25,448