NOTE 6 - PROPERTY AND EQUIPMENT

6 Months Ended

Jun. 30, 2011

Property, Plant and Equipment Disclosure [Text Block]

NOTE 6 – PROPERTY AND EQUIPMENT

Property and equipment was summarized as follows at June 30, 2011 and December 31, 2010:

	Estimated Useful Lives		2011		2010
			(Unaudited)
Plant		20	$	4,706,498	$	3,705,864
Machinery and equipment		10		9,991,103		9,784,462
Transportation equipment		5		113,503		111,155
Other machinery and equipment		5		56,455		55,287
Construction in progress				2,314,188		-
				17,181,747		13,656,768
Less:  Accumulated Depreciation				3,233,922		2,624,980
			$	13,947,825	$	11,031,788

Construction in progress consisted of the Company’s natural gas project and by-products processing project. Total estimated budget for natural gas project and by-products processing project are RMB 16 million ($2.5 million) and RMB 18 million ($2.8 million), respectively.

Depreciation of property and equipment was $634,226 and $248,871 for six months ended June 30, 2011 and 2010, respectively. Depreciation of property and equipment was $323,917 and $124,435 for three months ended June 30, 2011 and 2010, respectively. Depreciation included in cost of goods sold was $519,721 and $216,499 for six months ended June 30, 2011 and 2010, respectively. Depreciation included in cost of goods sold was $266,331 and $108,249 for three months ended June 30, 2011 and 2010, respectively.