Industry Leadership

Competition

In the current markets for non－ferrous and fluorite, supply in general cannot meet demand. At least for the short term, we do not expect that we will have difficulty selling our products. At this point, our business strategy is not to devote large financial resources in sales and promotion as compared to businesses in other industries. Our competitors mainly are similar companies in the same geographical region.

Compared to our competitors, we believe we enjoy superior experience, better management of projects and a good and stable management team.

Competitive Advantages

We believe we have the following competitive advantages:

• We have one of the best fluorite mines in China which has high purity fluorite ore and good extracting conditions.
• Experienced management team. Most of our officers have more than 20 years of experience in this industry.

We have good relationships with local government agencies compared to our competitors, we possess relatively more exploration rights and many of our subsidiaries are located in the western part of China and therefore enjoy many preferential tax and regulatory policies.