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China Petroleum & Chemical Corporation
2008 Annual Results Announcement
March 30, 2009Hong Kong
2009-3-30
Disclaimer
2
This presentation and the presentation materials distributed herein 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, 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.
2009-3-30
Agenda
2008 Overview
2008 Operational Results
2009 Operational Plan
3
2008 Overview
2009-3-30 5
Review of Market Environment
Chinese GDP increased by 9%
Crude oil price surged to historical high and then declined
sharply
Domestic refined oil product prices remained tightly controlled a
nd refining industry suffered severe loss
Domestic refined oil product market changed drastically and do
mestic consumption of refined oil products grew by 10.2%
Demand for chemical products declined, and domestic consump
tion of ethylene-equivalent dropped by 0.3%
2009-3-30 6
Operational Summary
2006 2007 2008 yoy%
Crude oil production (mm bbls) 285.2 291.7 296.8 1.7
Natural gas production (bcf) 256.5 282.6 293.1 3.7
Refinery throughput (kbpd) 3,069.1 3,253.0 3399.0 4.5
Domestic sales of refined oil products (mm tonnes)
111.68 119.39 122.98 3.0
Ethylene production * (‘000 tonnes) 6,163 6,534 6,289 (3.7)
Segment EBIT (RMB million)
E&P 63,182 48,766 66,569 36.5
Refining (25,710) (10,452) (61,538) N/A
Marketing 30,234 35,727 38,209 6.9
Chemicals 14,458 13,306 (13,102) N/A
Note: * Includes 100% production from BASF-YPC and Shanghai-Secco
2009-3-30 7
Financial Performance
RMB million 2006 2007 2008 yoy%
Turnover, other operating revenues and other income
1,066,902 1,209,706 1,502,443 24.2
EBITDA 114,186 129,179 73,946 (42.8)
EBIT 80,632 85,864 28,123 (67.2)
Net profit attributable to equity shareholders of the Company
53,603 56,533 29,769 (47.3)
EPS (RMB) 0.618 0.652 0.343 (47.3)
2009-3-30
Financial Position
8
RMB million 31 Dec. 2006 31 Dec. 2007 31 Dec. 2008
Short-term debts 56,467 44,654 74,896
Long-term debts 61,617 83,134 90,254
Total equity attributable to equity shareholders of the Company
264,334 307,433 328,669
Debt/Capital Ratio 27.6% 28.1% 27.9%
RMB million 2006 2007 2008
Net cash generated from operating activities
92,507 119,594 67,712
Net cash used in investing activities (103,385) (113,587) (110,158)
Net cash (used in)/generated from financing activities
2,878 (5,310) 41,777
2009-3-30
Dividend
9
RMB
Maintained a relatively stable dividend payout level
2009-3-30 10
Capital Expenditure
2008 Capex: RMB107.3 billion
RMB billion E&P Expanded key production facilities and increased
reserve utilization Sichuan-Eastern China Gas Project
Refining Qingdao Refinery Project commenced production Refining upgrading for processing lower quality
crude and producing higher quality products Caofeidian Crude Oil Jetty Project put into
operation
Marketing and Distribution Upgraded the existing service stations Added 720 new service stations over the year
Chemicals Major ethylene projects progressed smoothly Some chemical products upgrading projects
commenced production
2009-3-30
Cost Saving
11
2008 Cost Saving: RMB3.96 billion
RMB million
52%
2009-3-30 12
Technological Innovation
Patents
Driving corporate development through technological innovation
E&P: developed technological system such as Puguang gas field development
Refining: commercialized clean fuel technologies such as S-Zorb and diesel desulfurization
Took lead in producing Guo IV spec fuel for cities hosting 2008 Beijing Olympic Games
Strengthen R&D in alternative energy
Developed a series of new products to meet the market needs
2008 Operational Results
2009-3-30
E&P － Operational Summary
14
2006 2007 2008 yoy%
Crude oil production (mm bbls) 285.2 291.7 296.8 1.7
Natural gas production (bcf) 256.5 282.6 293.1 3.7
Lifting cost (RMB/tonne) 520 601 630 4.8
Newly added proved reserves of crude oil (mm bbls) 286 21 114 442.9
Newly added proved reserves of natural gas (bcf) 161.5 3,756.7 921.6 (75.5)
31 Dec. 2006
31 Dec. 2007
31 Dec. 2008
yoy%
Proved reserves of crude oil (mm bbls) 3,295 3,024 2,841 (6.1)
Proved reserves of natural gas (bcf) 2,857 6,331 6,959 9.9
Proved reserves of oil and gas (mm boe) 3,771 4,079 4,001 (1.9)
2009-3-30
E&P － Segment Performance
15
RMB million
Realized prices of Crude Oil and Natural Gas
EBIT of E&P Segment
2009-3-30
Refining － Operational Summary
16
2006 2007 2008 yoy%
Refinery throughput (kbpd) 3,069.1 3,253.0 3,399.0 4.5
Gasoline production (mm tonnes) 24.47 25.98 29.09 12.0
Diesel production (mm tonnes) 60.19 62.46 68.78 10.1
Kerosene production (mm tonnes) 6.35 8.32 7.99 (4.0)
Light chemical feedstock production (mm tonnes)
23.07 23.84 22.99 (3.6)
Light yield (%) 74.75 74.48 74.80 32bps
Refining yield (%) 93.47 93.95 94.07 12bps
2009-3-30
Refining － Segment Performance
17
RMB million
Refining Margin/ Cash Operating Cost
EBIT of Refining Segment
2009-3-30
Marketing － Operational Summary
18
2006 2007 2008 yoy%
Domestic sales of refined oil products
(mm tonnes)111.68 119.39 122.98 3.0
Incl. Retail (mm tonnes) 72.16 76.62 84.10 9.8
Distribution (mm tonnes) 18.95 20.17 19.63 (2.7)
Wholesales (mm tonnes) 20.57 22.60 19.25 (14.8)
Total number of service stations 28,801 29,062 29,279 0.7
Incl. Company-operated 28,001 28,405 28,647 0.9
Franchised 800 657 632 (3.8)
Annualized throughput of company-operat
ed stations (tonnes/station)2,577 2,697 2,935 8.8
2009-3-30
Marketing － Segment Performance
19
RMB/ tonne
RMB/ tonne
RMB/ tonne 2006 2007 2008
Marketing cash operating cost
130 139 153
RMB million
RON #90 Gasoline Guidance Price
0# Diesel Guidance Price
EBIT of Marketing Segment
Note: The State has adopted maximum retail price since December 2008
2009-3-30
Chemicals － Operational Summary
20
Unit: 1,000 tonnes 2006 2007 2008 yoy%
Ethylene 6,163 6,534 6,289 (3.7)
Synthetic resins 8,619 9,660 9,590 (0.7)
Monomers & polymers for synthetic fibers 7,242 8,018 7,264 (9.4)
Synthetic fibers 1,502 1,417 1,260 (11.1)
Synthetic rubbers 668 800 834 4.3
Urea 1,609 1,565 1,649 5.4
Note: The above data includes 100% production from BASF-YPC and Shanghai-Secco
2009-3-30
Chemicals Price Spread
21
Chemicals － Segment Performance
RMB million
EBIT of Chemicals Segment
RMB/ tonne 2006 2007 2008
Ethylene cash operating cost
1,282 1,329 1,328
USD/tonne
2009 Operational Plan
2009-3-30 23
Prospect for 2009
Challenges Oil price expected to fluctuate at low level
Oil product demand may experience lower
growth rate
Challenging situation for chemicals
business
Opportunities New gasoline and diesel pricing policy
Chinese government’s stimulus package
VAT Reform and moderately easy
monetary policies
Refining BusinessExpected to Become Profitable
Not to scale
2009-3-30 24
2009 Operation Estimates
2009-3
2008Actual
2009Estimates
Change%
Crude oil production (mm bbls) 297 301 1.3
Natural gas production (bcf) 293 353 20.5
Refinery throughput (mm tonnes)* 169 184 8.9
Total domestic sales of refined oil products (mm tonnes)
123 125 1.6
Ethylene production (mm tonnes) ** 629 683 8.6
Note: *Including 100% production from BASF-YPC and Shanghai-Secco
2009-3-30
Capital Expenditure Plan
25
2009 Capex Plan: RMB111.8 billion E&P Start-up of Sichuan-Eastern China
Gas Project Development of oil in Tahe, Shengli,
and gas in Puguang and Ordos
Refining Refined oil products quality
upgrading projects Improve logistic system incl.
pipeline and storage facilities
Marketing and Distribution Improve marketing networks Construction and acquisitions of
service stations along expressways and in strategic areas
Chemicals Progress in major ethylene projects Accelerate construction of logistic
facilities for chemical products
RMB billion
2009-3-30
For Further Information
http://www.sinopec.com
Investor Relations
Beijing: Tel: (8610) 59960028 Fax: (8610) 59960386Email: [email protected]
Hong Kong: Tel: (852) 28242638 Fax: (852) 28243669Email: [email protected]
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Media Relations
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