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<TYPE>EX-99.2
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<FILENAME>e603104_ex99-2.txt
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Exhibit 99.2

Gulf Resources, Inc. Subsidiary to Commercialize New Environmentally Friendly
Oil Fluid System

New fluid system recognized by all three of China's major oil groups; Purchase
Letter of Intents Signed

NEW YORK and SHANDONG, China, Jan. 7 /Xinhua-PRNewswire-FirstCall/ -- Gulf
Resources, Inc. (OTC Bulletin Board: GFRE - News), a leading Bromine producer in
the People's Republic of China (the 'PRC'), today announced that its wholly
owned subsidiary, Shouguang Yu Xin Chemical Industry Co., Ltd. (SYCI), a
specialty chemical manufacturer, has successfully developed and is ready to
commercialize in April, 2008, a new type of environmentally friendly oil field
drilling fluid system. The company has filed a patent for this proprietary
product.

The new product includes a polyol drilling fluid system and polyatomic alcohol
drilling fluid system. Because of their environmental friendly characteristics,
these systems are widely used under all circumstances, both in land and sea
operations. The system also has unique advantages in protecting oil and gas
formation, preventing collapse and lubricating. Compared with other drilling
fluids, the system is not only environmentally friendly but also enables
low-density drilling. The system provides timely detection of oil and gas
formation, strengthens the clay particles on the wall to provide stability which
prevents the collapse of the reservoir and also lubricates the drilling wall.
The system has been successfully recognized by China's three major oil groups,
Sinopec, CNOOC and CNPC, which is necessary to receive orders. Letters of intent
to purchase this product has been signed with CNPC's subsidiaries, the Tarim
Oilfield and CNPC Sichuan Petroleum with initial delivery to occur in May.
Currently, the market for this product is estimated by the Company at 30,000
tons with a current selling price of $1,512 ($11,000 RMB) per ton creating a $45
million market. Initial SYCI production capacity is expected to be 3,000 to
5,000 tons annually.

'We are pleased to announce that Shouguang Yu Xin's new environmental friendly
oil drilling fluid system is ready for commercialization. We are leveraging our
Company's development capabilities for new product introductions to our
installed customer base, which we expect to further strengthen our market
position in the oilfield chemical industry. This has laid a solid foundation for
us to enter major domestic oil fields in the future, creating another
significant growth opportunity for our shareholders,' commented Gulf Resources,
Inc. CEO, Mr. Yang Ming.

About Gulf Resources, Inc.

Gulf Resources, Inc. operates through two wholly-owned subsidiaries: SCHC which
is engaged in manufacturing and trading Bromine, which is used to manufacture a
wide variety of compounds utilized in industry and agriculture, and Crude Salt
in China; and SYCI which manufactures chemical products utilized in oil & gas
field explorations and as papermaking chemical agents. For more information,
please visit http://www.gulfresourcesco.com.

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Exhibit 99.2

About Shouguang Yu Xin Chemical Industry Co., Ltd. (SYCI)

SYCI produces and distributes chemical products and agents used in oil and gas
field exploration, oil and gas distribution, oil field drilling, wastewater
processing, and in the papermaking industry. The company services large
customers such as SINOPEC and PetroChina. Currently, there are 98 employees at
the company, including 5 managers, 10 technicians and 8 sales associates.

Safe Harbor Statement

Certain statements in this news release may contain forward-looking information
about Gulf Resources and its subsidiaries business and products within the
meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the
Securities Exchange Act of 1934, and are subject to the safe harbor created by
those rules. All forward-looking statements are expressly qualified in their
entirety by this Cautionary Statement and the risks factors detailed in the
Company's reports filed with the Securities and Exchange Commission. There can
be no assurance the PRE 14C will be deemed effective by the SEC.

    For more information, please contact:

    Gulf Resources, Inc.
    Ethan Chuang
    Tel:   +1-646-200-6316
    Email: Ethan@gulfresourcesco.com

    HC International, Inc.
    Matt Hayden
    Tel:   +1-760-994-0034
    Email: Matt.Hayden@hcinternational.net

SOURCE Gulf Resources, Inc.
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