1

August 29, 2005Hong Kong

China Petroleum & Chemical Corporation

1H 2005 Results Announcement

22005-8-29

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 proven reserves, 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.

Disclaimer

32005-8-29

• 1H 2005 Business Review

• 1H 2005 Financial Performance

• 2H 2005 Business Prospects

Agenda

4

1H 2005 Business Review

52005-8-29

Market Environment

• China’s economy maintained steady growth with GDP at 9.5%

– Domestic consumption of oil products increased by 5.56%

– Domestic consumption of petrochemicals (ethylene equivalent) increased by 5.70%

• Crude oil price climbed to a record high

• Petrochemical prices remained high albeit somewhat down from 4Q 2004

• Price control on refined oil products remained in effect

62005-8-29

7.275

4.81 5.583

1.9260.544

Profit Continues to Grow

EBIT Analysis

1H 2004 1H 2005

EBIT Total28.562

EBIT Total33.682

RefiningProfit Change

ChemicalsProfit Growth

E&P Profit Growth

MarketingProfit Change Corporate

& Others

Unit: RMB billion

72005-8-29

Crude oil production (mm bbls) 136.69 135.85 0.62

Natural gas production (bcf) 104.8 100.06 4.74

Lifting cost (USD/bbl) 6.98 6.28 11.15

Newly added proved oil & gas reserves (mm bo

e) 172.04 269.86 -36.25

E&P – Stable Production

1H 05 1H 04 Change (%)

Period-end proved oil and gas reserves (mm boe) 3,791 3,773 0.48

30 June 2005 31 Dec. 2004 Change (%)

82005-8-29

E&P Segment Performance

29.62

39.40

2.262.08

0

5

10

15

20

25

30

35

40

45

1H 2004 1H 2005

0

1

2

3

4

Crude Oil Natural Gas

10,520

17,795

0

5,000

10,000

15,000

20,000

1H 2004 1H 2005

Crude Oil and Natural GasRealized Price

RMB million

EBIT of E&P Segment

Crude OilUSD/bbl

Natural GasUSD/mcf

92005-8-29

Refining– Efficient Operation at Full Utilization

Crude Oil Processed (mm tonnes) 68.08 64.98 4.77

- Sour Crude Oil Processed (mm tonnes) 16.87 13.39 25.99

Gasoline Production (mm tonnes) 11.32 11.42 -0.88

Diesel Production (mm tonnes) 26.31 24.72 6.43

Kerosene Production (mm tonnes) 3.39 3.03 11.88

Light Chemical Feedstock Production (mm tonnes) 10.16 8.92 13.90

Light Yield (%) 74.24 74.06 18 bps

Refining Yield (%) 93.11 93.10 1 bp

1H 05 1H 04 Change (%)

102005-8-29

Refining Segment Performance

2.32

4.07

1.98 1.93

0.00

1.00

2.00

3.00

4.00

5.00

1H 2004 1H 2005

1.00

1.50

2.00

2.50

3.00

3.50

Refining Margin Cash Operating Cost

-1,296

4,287

-2,000

-1,000

0

1,000

2,000

3,000

4,000

5,000

1H 2004 1H 2005

EBIT of Refining SegmentRefining Margin / Cash Operating Cost

USD/bblRMB million

112005-8-29

Marketing - Optimized Marketing Network, Expanded Retail and Distribution

Domestic sales of refined oil products (mm tonnes)

50.77 45.49 11.61

Incl. Retail (mm tonnes) 29.56 25.12 17.68

Distribution (mm tonnes) 10.39 9.56 8.68

Total gas stations 30,352 30,682 -1.08

Incl. Self-operated stations 26,870 25,306 6.18

Franchised stations 3,482 5,376 -35.23

Annual average throughput of self-operated st

ations (tonnes/station)2,200 1,986 10.78

1H 05 1H 04 Change (%)

122005-8-29

Marketing Segment Performance

8,569

6,643

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

1H 2004 1H 2005

2000

3000

4000

5000

Jan Mar May Jul Sep Nov

2003 2004 2005

2000

3000

4000

5000

Jan Mar May Jul Sep Nov

2003 2004 2005149.93153.38Marketing cash operating cost (RMB/tonne)

1H20051H2004

EBIT of Marketing SegmentRON #90 Gasoline Guidance PriceRMB/Tonne

#0 Diesel Guidance Price

RMB/Tonne

RMB million

132005-8-29

Chemicals — Production Aligned with Market Demand

Unit: 1,000 tonnes

Ethylene 2,434 2,081 16.96

Synthetic resin 3,528 3,102 13.73

Incl. performance compound 1,689 1,545 9.32

Synthetic rubber 308 297 3.70

Monomers & polymers for synthetic fibers 3,152 3,030 4.03

Synthetic fiber 756 824 -8.25

Incl. differential fiber 384 359 6.96

Urea 998 1,322 -24.51

Data above for 1H 2004 and 1H 2005 include production from the chemical assets acquired from Sinopec Group at the end of 2004. 100% production from YPC-BASF and Shanghai-Secco was calculated into the statistics in 2005.

1H 05 1H 04 Change (%)

142005-8-29

Chemicals Segment Performance

10,815

6,005

0

2,000

4,000

6,000

8,000

10,000

12,000

1H 2004 1H 2005

148.87142.64Ethylene cash operating cost (USD/tonne)

1H20051H2004

EBIT of Chemicals Segment Chemicals Price Spread (1990 - Jul. 2005)RMB million

USD/tonne

0

200

400

600

800

1000

1200

Jan-1990 Jan-1993 Jan-1996 Jan-1999 Jan-2002 Jan-2005

LDPE-Naphtha PP-Naphtha

152005-8-29

Cost Reduction

Total cost reduction reached RMB 1.282 billion in 1H 2005

RMB million

0

500

1,000

1,500

2,000

2,500

3,000

2005 Plan 1H 2005 Actual

E&P Refining Marketing Chemicals

2,500

1,282

162005-8-29

Capital Expenditure

1H 2005 Capex: RMB22.55 bn• E & P –10.077 bn, focus on progressive expl

oration in the existing blocks and pre-exploration in new blocks

• Refining – 3.451 bn, second phase of Ningbo-Shanghai-Nanjing pipeline is close to completion, and a number of revamping projects are progressing smoothly

• Marketing – 6.384 bn, south-west oil pipeline at its final stage, construction and acquisition of petrol stations on schedule

• Chemicals – 2.242 bn, a batch of key revamping projects, such as Maoming ethylene project and chemical fertilizer revamping projects, progressed smoothly

1H 2005 Capex Breakdown

In addition, RMB1.854 bn invested in Shanghai-Secco and other JV projects

0

10

20

30

40

50

60

70

2005 Plan 1H 2005 Actual

E&P RefiningMarketing ChemicalsCorporate & Others

62.00

22.55

RMB billion

17

1H 2005 Financial Performance

182005-8-29

Significant Growth in Profit

Unit: RMB million

Turnover and other operating revenues 368,454 279,445 31.85

EBITDA 48,837 43,961 11.09

EBIT 33,682 28,562 17.93

Profit for the period 21,769 18,921 15.05

Attributable to equity holders of the parent 19,653 16,746 17.36

Minority interests 2,116 2,175 -2.71

EPS (RMB) 0.227 0.193 17.36

1H 05 1H 04 Change (%)

192005-8-29

Financial Highlights

Unit: RMB million

Short-term debt 39,374 32,307

Long-term debt 73,735 60,822

Equity attributable to equity holders of the parent 205,757 193,040

Cash flow from operating activities 21,082 20,698

Cash flow for investing activities 31,400 31,050

Cash flow from financing activities 7,553 9,500

Cash & cash equivalents - opening balance 16,381 16,263

Cash & cash equivalents - ending balance 13,616 15,410

As of 30 June 2005 As of 31 Dec. 2004

1H 05 1H 04

202005-8-29

Returns and Dividends

0.040.040.03

0.08

0.06

0.00

0.02

0.04

0.06

0.08

0.10

0.12

0.14

2003 2004 2005

Interim Dividend Final Dividend

ROCE

9.01%

12.84%

6.17%

0%

2%

4%

6%

8%

10%

12%

14%

2003 2004 1H 2005

ROCE for 1H 2005 was not annualized

DividendsRMB Yuan

21

2H 2005 Business Prospects

222005-8-29

Market Environment in 2H 2005

• China’s economy is expected to maintain rapid growth

– Demand for oil products and petrochemicals will increase steadily

• Crude oil price will remain high and volatile

• Global refining and chemical sectors should remain favorable

• Appreciation of RMB will lower the purchasing cost of crude oil

• Price control on refined oil products will remain effective

232005-8-29

E & P

• Implement aggressive resource strategy, expedite exploration and development, pursue 100% reserve replacement

• Build up production capacity in Tahe oilfields in western China and shallow water blocks of Shengli oilfields in eastern China

• Expand natural gas market

Crude oil production (mmbbl) 140.20 136.69 2.57

Natural gas production (bcf) 1,090 1,048 4.01

1H Actual Change%2H Plan

242005-8-29

• Diversify crude resources to reduce purchasing cost

• Take advantage of pipeline transportation and optimize resource allocation to reduce transportation cost

• Adjust crude oil processing scheme and product mix to increase high value-added product volumes

• Strengthen management and ensure safe, stable and efficient operation

Refining

Crude throughput (million tonnes) 72.00 68.08 5.76

1H Actual Change%2H Plan

252005-8-29

• Conduct market analysis and expand sales volumes appropriately

• Strengthen management of stations to increase retail and direct sales volumes

• Fully leverage logistics network to optimize allocation of resources, to reduce cost

• Expedite construction of pipelines and stations in strategic locations to further optimize network

• Accelerate application of petrol IC cards to realize the target of “One Card, All Sinopec Stations”

Marketing

Total domestic sales (million tonnes) 52.00 50.77 2.42

Incl. Retail (million tonnes) 30.40 29.56 2.84

Direct sales (million tonnes) 10.60 10.39 2.02

1H Actual Change%2H Plan

262005-8-29

Chemicals

• Fully exploit newly added capacity and increase production of

major chemical products

• Implement market-oriented strategies and increase production of

performance compound resins and differential fibers

• Fully leverage newly established Chemical Sales Company and

improve competitiveness

Ethylene production (million tonnes) 2.75 2.434 12.98

1H Actual Change%2H Plan

272005-8-29

Conclusion

• Continue to implement operating strategy of “Reform,

Adjustment, Innovation, and Development”

• Strive to achieve whole year operating targets

• Maintain sound operating performance

Achieve sustainable and efficient growth

282005-8-29

http://www.sinopec.com

For Further Information

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