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March 31, 2004 Hong Kong

China Petroleum & Chemical Corporation Results for the Year Ended December 31, 2003. March 31, 2004 Hong Kong. Forward Looking Statement.

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March 31, 2004 Hong Kong

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  1. China Petroleum & Chemical CorporationResults for the Year Ended December 31, 2003 March 31, 2004 Hong Kong

  2. Forward Looking Statement This presentation and the presentation materials distributed herewith include forward-looking statements. All statements, other than statements of historical facts, that address activities, events or developments that Sinopec Corp. expects or anticipates will or may occur in the future (including but not limited to projections, targets, estimates and business plans) are forward-looking statements. Sinopec Corp.'s actual results or developments may differ materially from those indicated by these forward-looking statements as a result of various factors and uncertainties, including but not limited to price fluctuations, actual demand, exchange rate fluctuations, exploration and development outcomes, estimates of proved reserves, market shares, competition, environmental risks, changes in legal, financial and regulatory frameworks, international economic and financial market conditions, political risks, project delay, project approval, cost estimates and other risks and factors beyond our control. In addition, Sinopec Corp. makes the forward-looking statements referred to herein as of today and undertakes no obligation to update these statements.

  3. Agenda • 2003 Performance Highlights and Achievements from Continued Reform and Development • 2003 Operating Results • 2004 Outlook

  4. 2003 Performance Highlights and Achievements from ContinuedReform and Development

  5. Significant Profit Growth through Continued Reform and Restructuring EBIT Analysis Unit: RMB billion Headquarters & Others Chemicals Profit Growth Asset Disposal Impairment Losses of Fixed Assets SeveranceCost Marketing Profit Growth Refining Profit Growth E&P Profit Growth 2002 2003 Profit Growth in business segments = EBIT of 2003 before deducting asset disposal, impairment losses of fixed assets and severance cost – EBIT of 2002

  6. 2002 2003 (RMB in billion) Revenue EBITDA EBIT Net Profit EPS (RMB) DPS (RMB) Cash from Operating Activities Cash & Cash Equivalent - Ending Balance Short-term Debt Long-term Debt Shareholders’ Equity Solid Financial Performance Segmental EBIT Performance RMB bn 2002/2003 yoy (%) 28.9 329.1 424.3 18.5 54.0 64.0 30.0 28.7 37.3 32.5 16.3 21.6 32.5 0.19 0.25 12.5 0.08 0.09 10.1 55.0 60.6 -16.5 18.2 15.2 -18.3 35.6 29.1 4.8 41.6 43.6 2.5 167.9 163.8

  7. Higher Investment Return andImproved Capital Structure ROCE Debt / Total Capital and EBITDA Interest Coverage ROCE % Debt / Total Capital % EBITDA Interest Coverage Note: Data of 2002 and onwards include Maoming Ethylene, Xi’an Petrochemical and Tahe Petrochemical

  8. Improved Corporate Governance • Elected the second session of Board of Directors and Supervisory Committee • Revised Articles of Association and other documents to meet regulatory requirements of the four listing venues and reflect our commitment to strong corporate responsibility and credibility • Streamlined decision making process and fully leveraged the roles of the independent directors and the three committees (Strategic, Audit and Compensation) under the Board of Directors • Further enhanced internal control procedures • Improved transparency through timely, accurate and complete disclosure • Awarded Best Corporate Governance and Best IR Awards, by Euromoney and FinanceAsia, etc.

  9. Continued in-depth Corporate Reform and Restructuring • Further reform in compensation system • Introduced market-rate-based practice • Improved efficiency through further headcount reduction of 21,000 in 2003 • Specialized marketing system reform • Established acrylic fiber sales company

  10. Optimized Asset Structure • Continued restructuring to strengthen core business • Acquisition of Maoming Ethylene • Acquisition of Xi’an Petrochemical and Tahe Petrochemical to streamline integrated value chain • Disposal of underperforming assets

  11. Stable Dividend Payout RMB in bn RMB cents / Share Note: Data of 2002 and onwards include Maoming Ethylene, Xi’an Petrochemical and Tahe Petrochemical

  12. 2003 Operating Results

  13. 2003 Market Environment • Robust economic growth in China with GDP growth rate of 9.1% • Domestic consumption of refined products increased by 7.22% • Domestic consumption of chemicals increased by 9.65% • International crude oil price fluctuated at a relatively high level • Domestic demands for refined products and chemicals soared after a depression early in the year due to SARS

  14. E&P — Continued Growth in Oil & Gas Production

  15. USD/bbl USD/mcf E&P – Segment Performance International Crude Oil Price EBIT of E&P Segment RMB mm USD/bbl Crude Oil and Natural Gas Realized Price

  16. 2003/2002Change (%) 2001 2002 2003 Crude Oil Processed (mm tonnes) 116.26 101.42 105.01 10.71 850bps Refining Utilization Rate (%) 87.8 77.9 79.3 Sour Crude Oil Processed (mm tonnes) 23.77 19.25 20.00 18.85 Gasoline Production (mm tonnes) 21.74 18.74 19.62 10.8 Diesel Production (mm tonnes) 41.67 37.93 37.74 10.4 Chemical Feedstock Production (mm tonnes) 16.46 12.36 15.04 9.44 Kerosene Production (mm tonnes) 5.31 4.47 5.06 4.9 Light Stream Yield (%) 73.80 72.33 73.22 58bps Refining Yield (%) 92.60 92.23 92.50 10bps Refining – Strong Demand Growth and  Improved Product Mix Note: Above figures exclude Xi’an Petrochemical and Tahe Petrochemical

  17. Refining — Segment Performance Refining Margin / Cash Operating Cost Refining Segment EBIT USD/bbl RMB MM Note: Data of 2002 and onwards include Xi’an Petrochemical and Tahe Petrochemical

  18. Marketing — Optimized Marketing Network, Expanded Retail and Distribution 2003/2002Changes (%) 2001 2002 2003 67.74 70.09 75.92 8.3 Domestic Sales of RefinedProducts (mm tonnes) Retail (mm tonnes) 30.43 34.73 38.85 11.9 Distribution (mm tonnes) 11.64 12.63 15.33 21.4 Total Number of Gas Stations (Unit) 7.5 28,246 28,127 30,242 Owned or Operated Gas Stations 2.1 24,062 24,000 24,506 Franchised Gas Stations 4,184 4,127 5,736 39.0 1,686 8.1 1,473 1,560 Annual Average Throughput Per Station (tonne/station)

  19. Marketing – Segment Performance RON 90# Gasoline Guidance Price Marketing Segment EBIT RMB/Tonne RMB MM 0# Diesel Guidance Price RMB/Tonne

  20. 2003/2002Changes (%) 16.7 17.1 24.8 9.6 15.23 11.01 18.66 -23.93 Chemicals — Full Capacity to Meet Market Demand Unit: 1,000 tonnes 2001 2002 2003 Ethylene 2,716 3,169 2,153 Synthetic Resins 4,005 4,691 3,204 Incl. Performance Compound 1,847 2,305 1,332 Synthetic Rubbers 458 502 398 Monomers & Polymers for Synthetic Fibers 3,834 4,418 3,598 Synthetic Fibers 1,153 1,280 1,028 Incl. Differential Fiber 402 477 326 2,666 2,028 2,342 Urea Note: The above figures exclude Maoming Ethylene

  21. Chemicals – Segment Performance Ethylene Cash Operating Costs Chemicals Segment EBIT (RMB MM) USD/tonne Chemicals Price Spread (1990 ~ Feb.2004) USD/tonne Note: Data of 2002 and onwards include acquisition of Maoming Ethylene

  22. Cost Reduction Cost Reduction in 2003 was RMB 2.722 bn (RMB mm)

  23. Optimized Investment Focus and Asset Structure Capex in the Past 3 Years 2003 Capex: RMB45.05 bn (RMB bn) • E&P – RMB20.63 bn to increase production and rationalize reserve profile • Refining – RMB9.73 bn to complete a number of upgrading and expansion projects andincrease clean fuel capacity. Ningbo-Shanghai-Nanjing crude oil pipeline will commence operation soon • Marketing – RMB6.82 bn to acquire, construct and revamp gas stations and storage and transport facilities; construction of southwest refined oil pipeline in progress • Chemicals – RMB7.35 bn to upgrade existing ethylene and urea feedstock coal gasification projects • Corporateand others – RMB520 mm for information system, etc Additional RMB4.2 bn invested in Secco and other JV projects

  24. Achievements in R&D and Information System • Successfully developed upstream exploration and development technologies such as exploration of hidden oil and gas reserves • Developed a number of key refining and chemical technologies, including the 2nd generation loop type polypropylene packaged technologies • Gasoline products fully complied with new specifications through application of self developed technologies • Major breakthrough in ERP deployment

  25. Smooth Progress in JV Projects • East China Sea natural gas project with CNOOC, Shell and Unocal officially launched • Ethylene projects with BASF in Nanjing and with BP in Shanghaiare under construction, expected completion in 1H 2005 • Coal gasification project with Shell in Hunan is under construction, expected completion in 2005 • Feasibility study of Fujian integrated petrochemical project with Exxonmobil and Aramco was approved • Feasibility study of refined products retail JV with Shell in Jiangsu was approved • Feasibility study of retail cooperation project was submitted for approval • Biyang (Ningbo) LPG Co., Ltd. (a JV between ZRCC and BP) established

  26. 2004 Outlook

  27. 2004 Market Analysis • Opportunities • Chinese economy is expected to maintain sustainable growth with GDP growth rate of around 7%; consumption of refined products and chemicals is expected to grow by more than 5% and 8.6%, respectively • Crude oil price is expected to maintain at relatively high level • Refining margin continues to stay healthy • Chemical business is entering an up-cycle • Challenges • Increasing competition as interim protective policies are being phased out after China’s accession to the WTO

  28. 2004 Production Plan

  29. 2004 Capex Plan 2004 Capex Plan: RMB50.2 bn • Adjust oil and gas reserveprofile, increase reserves and production, and improve reserve profile among different categories • Accelerate upgrading and expansion of refineries in the coastal regions, improve product mix and leverage synergies between refining and chemicals • Construct and acquire gas stations in strategic locationsin city centers and along new expressways • Focus on core business and accelerate structural adjustment and technical upgrade • Establish a modern logistics system Unit: RMB bn Meanwhile, accelerate the construction of JV projects such as BASF-Yangzi and Secco

  30. 2004 Cost Reduction Plan RMB mm Total: RMB 2.5 bn

  31. Conclusion • Healthy and stable economic growth in China provides a favorable environment for Sinopec’s development • Integrated business operations mitigate risks associated with industry cycles • Continue to strengthen our leading position in domestic refined product market • Refining & chemical businesses entering an up-cycle • Continue to restructure and reform, rationalize operation structure, improve management and asset efficiency • Maintain sound corporate governance and stable dividend payout

  32. For Further Information http://www.sinopec.com.cn Investor Relations Beijing: Tel: (8610) 64990060 Fax: (8610) 64990489 Email: ir@sinopec.com.cn Hong Kong: Tel: (852) 28242638Fax: (852) 28243669 Email: ir@sinopechk.com New York: Tel: (212) 759 5085 Fax: (212) 759 6882 Email: fangzq@sinopecusa.com Media Relations Tel: (8610) 64990092 Fax: (8610) 64990093 Email: media@sinopec.com.cn

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