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18. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS

9 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

18. CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS

As of September 30, 2014, the Company has leased a real property adjacent to Factory No. 1, with the related production facility, channels and ducts, other production equipment and the buildings located on the property, under capital lease. The future minimum lease payments required under capital lease, together with the present value of such payments, are included in the table show below.

The Company has leased nine pieces of land under non-cancelable operating leases, which are fixed in rentals and expired through December 2021, December 2030, December 2031, December 2032, December 2040, February 2059, August 2059 and June 2060, respectively. The Company accounts for the leases as operating leases.

The following table sets forth the Company’s contractual obligations as of September 30, 2014:


		Capital Lease Obligations		Operating Lease Obligations				Property Management Fees				Exploration Project Expenditure
Payable within:
the next 12 months	$	305,088	$		980,497		$		101,403		$	568,890
the next 13 to 24 months		305,088		999,498				101,403				-
the next 25 to 36 months		305,088		1,022,358				101,403				-
the next 37 to 48 months		305,088		1,043,220				25,351				-
the next 49 to 60 months		305,088		1,068,182				-				-
thereafter		3,355,963		20,776,768				-				-
Total	$	4,881,403	$	25,890,523		$		329,560		$		568,890
Less: Amount representing interest		(1,915,187)
Present value of net minimum lease payments	$	2,966,216

Rental expenses related to operating leases of the Company amounted to $244,097 and $239,111, which were charged to the income statements for the three-month ended September 30, 2014 and 2013, respectively. Rental expenses related to operating leases of the Company amounted to $733,138 and $710,643, which were charged to the income statements for the nine-month ended September 30, 2014 and 2013, respectively.