SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

The Securities Exchange Act of 1934

 

For the month of March, 2017

 

CHINA PETROLEUM & CHEMICAL CORPORATION

22 Chaoyangmen North Street,

Chaoyang District, Beijing, 100728

People's Republic of China

Tel: (8610) 59960114

 

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F     X              Form 40-F _____

 

(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes ____          No     X    

 

(If "Yes" is marked, indicate below the file number assigned to registrant in connection with Rule 12g3-2(b): 82-__________.)

N/A

This Form 6-K consists of:

 

A copy of 2016 annual report of China Petroleum & Chemical Corporation (the “Registrant”) filed with the Hong Kong Exchanges and Clearing Limited.

 

 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

China Petroleum & Chemical Corporation

 

By: /s/ Huang Wensheng

 

Name: Huang Wensheng

 

Title: Vice President and Secretary to the Board of Directors

 

 

Date: March 28, 2017

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COMPANY PROFILE

 

IMPORTANT NOTICE: THE BOARD OF DIRECTORS, THE BOARD OF SUPERVISORS, DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT OF SINOPEC CORP. WARRANT THAT THERE ARE NO FALSE REPRESENTATIONS, MISLEADING STATEMENTS OR MATERIAL OMISSIONS IN THIS ANNUAL REPORT, AND JOINTLY AND SEVERALLY ACCEPT FULL RESPONSIBILITY FOR THE AUTHENTICITY, ACCURACY AND COMPLETENESS OF THE INFORMATION CONTAINED IN THIS ANNUAL REPORT. THERE IS NO OCCUPANCY OF NON- OPERATING FUNDS BY THE CONTROLLING SHAREHOLDERS OF SINOPEC CORP. MR. WANG YUPU, CHAIRMAN OF THE BOARD OF DIRECTORS, MR. DAI HOULIANG, VICE CHAIRMAN AND PRESIDENT, MR. WANG DEHUA, CHIEF FINANCIAL OFFICER AND HEAD OF THE FINANCIAL DEPARTMENT OF SINOPEC CORP. WARRANT THE AUTHENTICITY AND COMPLETENESS OF THE FINANCIAL STATEMENTS CONTAINED IN THIS ANNUAL REPORT. THE AUDIT COMMITTEE OF SINOPEC CORP. HAS REVIEWED THE ANNUAL RESULTS OF SINOPEC CORP. FOR THE YEAR ENDED 31 DECEMBER 2016.

THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2016 OF THE COMPANY PREPARED IN ACCORDANCE WITH THE PRC ACCOUNTING STANDARDS FOR BUSINESS ENTERPRISES (ASBE) AND INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) HAVE BEEN AUDITED BY PRICEWATERHOUSECOOPERS ZHONG TIAN LLP AND PRICEWATERHOUSECOOPERS RESPECTIVELY. BOTH FIRMS HAVE ISSUED STANDARD UNQUALIFIED AUDITOR’S REPORT.

AS APPROVED BY THE 12TH MEETING OF THE SIXTH SESSION OF THE BOARD OF DIRECTORS OF SINOPEC CORP., THE BOARD PROPOSED A FINAL CASH DIVIDEND OF RMB 0.17 (TAX INCLUSIVE) PER SHARE FOR 2016, COMBINING WITH THE INTERIM CASH DIVIDEND OF RMB 0.079 (TAX INCLUSIVE) PER SHARE, THE TOTAL CASH DIVIDEND FOR 2016 WILL BE RMB 0.249 (TAX INCLUSIVE) PER SHARE. THE DIVIDEND PROPOSAL IS SUBJECT TO THE SHAREHOLDERS’ APPROVAL AT THE ANNUAL GENERAL MEETING FOR THE YEAR 2016.

COMPANY PROFILE

Sinopec Corp. is one of the largest integrated energy and chemical companies in China. Its principal operations include the exploration and production, pipeline transportation and sale of petroleum and natural gas; the production, sale, storage and transportation of refinery products, petrochemical products, coal chemical products, synthetic fibre, and other chemical products; the import and export, including an import and export agency business, of petroleum, natural gas, petroleum products, petrochemical and chemical products, and other commodities and technologies; and research, development and application of technologies and information.

DEFINITIONS:

In this report, unless the context otherwise requires, the following terms shall have the meaning set out below:

Sinopec Corp.: China Petroleum & Chemical Corporation;

Company: Sinopec Corp. and its subsidiaries;

China Petrochemical Corporation: our controlling shareholder, China Petrochemical Corporation;

Sinopec group: China Petrochemical Corporation and its subsidiaries;

Sichuan-to-East China Pipeline Co.: Sinopec Sichuan-to-East China Natural Gas Pipeline Co., Ltd;

RMC: Oil and Natural Gas Reserves Management Committee of the Company;

CSRC: China Securities Regulatory Commission.

Hong Kong Stock Exchange: The Stock Exchange of Hong Kong Limited Hong Kong Listing Rules: Listing Rules of the Hong Kong Stock Exchange

Conversion:

For domestic production of crude oil, 1 tonne = 7.1 barrels;

For overseas production of crude oil: 2016, 1 tonne = 7.20 barrels; 2015, 1 tonne = 7.21 barrels; 2014, 1 tonne = 7.22 barrels;

For production of natural gas, 1 cubic meter = 35.31 cubic feet;

Refinery throughput is converted at 1 tonne = 7.35 barrels.

 

 

 

	For the year ended 31 December
	2016	2015	Change	2014
Items	RMB Million	RMB Million	(%)	RMB Million
Operating income	1,930,911	2,020,375	(4.4)	2,827,566
Operating profit	78,876	52,246	51.0	65,798
Profit before taxation	79,877	56,093	42.4	66,795
Net profit attributable to equity shareholders of the Company	46,416	32,281	43.8	47,603
Net profit attributable to equity shareholders of the Company excluding extraordinary gains and losses	29,713	28,901	2.8	43,238
Net cash flow from operating activities	214,543	165,740	29.4	148,019

	First Quarter	Second Quarter	Third Quarter	Fourth Quarter	Total
Items	RMB million	RMB million	RMB million	RMB million	RMB million
Operating income	414,061	465,159	484,725	566,966	1,930,911
Net profit attributable to equity shareholders of the Company	6,190	13,060	9,916	17,250	46,416
Net profit attributable to equity shareholders of the Company excluding extraordinary gains and losses	6,403	11,887	10,047	1,376	29,713
Net cash flow from operating activities	34,285	41,827	55,588	82,843	214,543

Items	2016 RMB million	2015 RMB million	Change %	2014 RMB million
Total assets	1,498,609	1,447,268	3.5	1,455,594
Total liabilities	666,084	657,703	1.3	804,473
Total equity attributable to equity shareholders of the Company	712,232	677,538	5.1	596,697
Total number of shares (1,000 shares)	121,071,210	121,071,210	—	118,280,396

	For the year ended 31 December
	2016	2015	Change	2014
Items	RMB	RMB	%	RMB
Basic earnings per share	0.383	0.267	43.4	0.407
Diluted earnings per share	0.383	0.267	43.4	0.406
Basic earnings per share (excluding extraordinary gains and losses)	0.245	0.239	2.5	0.370
Weighted average return on net assets (%)	6.68	5.07	1.61 percentage points	8.14
Weighted average return (excluding extraordinary gains and losses) on net assets (%)	4.33	4.52	(0.19) percentage points	7.42
Net cash flow from operating activities per share	1.772	1.371	29.2	1.267

Items	2016 RMB	2015 RMB	Change %	2014 RMB
Net assets attributable to equity shareholders of the Company per share	5.883	5.606	4.9	5.108
Liabilities to assets ratio (%)	44.45	45.44	(0.99) percentage points	55.27

(4)

Items measured by fair values

 

 

 

CHANGES IN SHARE CAPITAL AND SHAREHOLDINGS OF PRINCIPAL SHAREHOLDERS

 

Name of shareholders	Nature of Shareholders	Percentage of Shareholdings	Total number of shares held	Change of shareholding	Number of shares subject to pledges or lock-up
China Petrochemical Corporation	State-owned Share	70.86	85,792,671,101	0	0
HKSCC Nominees Limited2	H Share	20.96	25,379,653,053	5,311,433	Unknown
中國證券金融股份有限公司	A Share	1.54	1,861,425,318	96,593,005	0
HKSCC Nominees Limited	A Share	0.30	361,151,404	284,218,172	0
中央匯金資產管理有限責任公司	A Share	0.27	322,037,900	0	0
工銀瑞信基金-工商銀行-特定客戶資產管理	A Share	0.12	139,961,578	139,961,578	0
國泰君安證券股份有限公司	A Share	0.11	131,135,206	(3,402,700)	0
交通銀行股份有限公司-滙豐晉信雙核策略混合型 券投基金	A Share	0.08	91,545,992	68,870,234	0
中國工商銀行-上證50交易型開放式指數證券投資基金	A Share	0.06	77,858,630	1,220,850	0
長江證券股份有限公司	A Share	0.06	71,197,295	23,928,471	0

 

BlackRock, Inc.	Interest of corporation controlled by the	2,278,374,418(L)	8.93(L)
	substantial shareholder	1,558,000(S)	0.01(S)
JPMorgan Chase & Co.	Beneficial owner	492,573,324(L)	1.93(L)
		158,634,692(S)	0.62(S)
	Investment manager	31,602,000(L)	0.12(L)
	Trustee (exclusive of passive trustee)	20,400(L)	0.00(L)
	Custodian corporation/approved lending agent	908,006,153(L)	3.56(L)
Schroders Plc	Investment manager	1,275,857,318(L)	5.00(L)

(1)  Issuance of securities in reporting period There is no issuance of shares of Sinopec Corp. during the reporting period   (2)  Existing employee shares As at the end of the reporting period, there were no employee shares.   4       CHANGES IN THE CONTROLLING SHAREHOLDERS AND THE DE FACTO CONTROLLER There was no change in the controlling shareholder and the de facto controller of Sinopec Corp. during the reporting period.   (1)  Controlling shareholder The controlling shareholder of Sinopec Corp. is China Petrochemical Corporation. Established in July 1998, China Petrochemical Corporation is a state-authorised investment organisation and a state-owned enterprise. The legal representative is Mr. Wang Yupu. Through re-organisation in 2000, China

Petrochemical Corporation injected its principal petroleum and petrochemical businesses into Sinopec Corp. and retained certain petrochemical facilities. It provides well-drilling services, well- logging services, downhole operation services, services in connection with manufacturing and maintenance of production equipment, engineering construction, utility services including water and power and social services.   Shares of other listed companies directly held by China Petrochemical Corporation

(2)  Other than HKSCC Nominees Limited, there was no other legal person shareholder holding 10% or more of the total issued share capital of Sinopec Corp.   (3)  Basic information of the de facto controller China Petrochemical Corporation is the de facto controller of Sinopec Corp.   (4)  Diagram of the equity and controlling relationship between Sinopec Corp. and its de facto controller *:   Inclusive of 553,150,000 H shares held by Sinopec Century Bright Capital Investment Ltd. (overseas wholly-owned subsidiary of China Petrochemical Corporation) through HKSCC Nominees Limited.

 

 

CHAIRMAN'S STATEMENT

 

 

Mr. Wang Yupu, Chairman		In 2016, in accordance with the IFRS, the Company recorded a turnover and other operating revenue of RMB 1,930.9 billion. Profit before taxation was RMB80.2 billion, represented a 42.1% increase year on year, of which profit attributable to owners of the Company amounted to RMB46.7 billion, represented a 43.6% increase year on year.   Taking into account the Company’s profitability, shareholders return and the need for future development, the Board of Directors proposed a final dividend of RMB 0.17 per share, which, combined with the interim dividend of RMB 0.079 per share, brought the full-year dividend to RMB 0.249 per share. The dividend payout ratio reaches 64.6%.   Over the past year, in its efforts to implement supply-side structural reform, the Company benefited from its integrated value chain, which allows our businesses to complement each other well. As we increased the effective supply of petroleum and petrochemical products and related services to the community, we reaped economic benefits and improved our asset utilisation. To cope with harsh conditions in the upstream sector, we strengthened measures to rein in costs and address our weaknesses. At the same time, we gave priority to high- efficiency exploration activities and made a number of important new discoveries. In line with our emphasis on profitability, we made continuous improvements in our oil production and trimmed production of high-cost oilfields, thereby effectively controlling our production costs. The Company also continuously improves its energy structure by increasing production of shale gas. As a result, domestic gas production for the year reached 21.6 billion cubic meters, while we further developed Fuling shale gas field, China’s first large-scale shale gas project, to an annual capacity of 7 billion cubic meters. Our energy structure improved steadily as our gas supply in the Yangtze River Economic Belt and the Beijing-Tianjin-Hebei region continued to grow. In downstream operations, the Company achieved robust results by taking advantage of market opportunities to expand the effective supply of mid-range and high-end products. We optimised the structure of our refinery products according to market demand and vigorously promoted applications of new technologies, leading to a lower diesel- to-gasoline ratio. Moreover, we pressed ahead with upgrading of our oil product specification to ensure implementation of GB V standards for automobile gasoline and diesel fuels and the GB VI standards for Beijing. At the same time, we eliminated obsolete and low-efficiency production
Dear Shareholders and Friends:   On behalf of the Board of Directors, the management and all the staff of Sinopec Corp., I would like to express my sincere gratitude to our shareholders and the wider community for your interest and support.   In 2016, as a result of low oil prices, the Company faced a challenging and complex operating environment. Given those conditions, on one hand, in light of the government’s new thinking about the country’s development, the Company took a visionary approach to the future. Guided by our strategies of value-oriented growth, innovation-driven development, integrated resource allocation, openness to cooperation, and green, low-carbon development, we formulated our 13th Five-Year Plan and has been continuously creating new and sustainable competitive advantages. On the	other hand, in view of the difficulties that low oil prices created for our upstream operations, along with slower growth in downstream demand and structural changes in the external environment, we intensified our reform initiatives and implemented stricter controls over our investment plans in tandem with a series of major reforms on the supply side. Over the past year, our focus on transformation of growth mode and structural adjustments allowed us to improve the quality and efficiency of our assets as well as upgrade our operations. Under the management’s leadership, the entire staff united to advance these goals. We achieved significant improvement in our operating results through unrelenting joint efforts to explore new markets, optimise our operations, reduce costs and improve risk management. Together, these achievements represented an exceptional start to our 13th Five-Year Plan.

 

BUSINESS REVIEW AND PROSPECTS

 

 

BUSINESS REVIEW In 2016, global economic recovery continued to be weak, while China’s economy maintained its stable growth, with gross domestic product (GDP) up by 6.7%. International oil prices fluctuated above their lowest levels. With abundant supply, domestic oil products market witnessed strong competition. Demand for chemicals grew steadily, and China’s environmental regulations became more stringent. The Company actively addressed market changes through a focus on growth quality, profitability and restructuring. We pressed ahead with measures to address market development, optimisation, cost reduction and risk control, coordinating all aspects of our work, which helped deliver operating results that were better than expected.     1   MARKET REVIEW (1)          Crude Oil Market In 2016, international crude oil prices bottomed out and fluctuated upwards, yet still remained at a low level. The average spot price of Platt’s Brent for the year was USD 43.69 per barrel, down by 16.7% from the previous year.   (2)          Refined Oil Products Market In 2016, domestic demand for refined oil products maintained its growth while the structure of consumption continued to change, and market supply was in surplus. According to our statistics, apparent consumption of refined oil products (including gasoline, diesel and kerosene) was 288 million tonnes, up by 4.3% from the previous year, with gasoline up by 11.9%, kerosene up by 11.0% and diesel down by 2.2%. The government further improved the pricing mechanism for refined oil products by setting the floor price. In 2016, the government made 15 price adjustments with 10 increases and 5 decreases.   (3)          Chemical Products Market In 2016, domestic demand for chemicals grew steadily. According to our statistics, domestic apparent consumption of ethylene equivalent was up by 3.0% from the previous year, and consumption of synthetic resin, synthetic fiber and synthetic rubber rose by 5.1%, 2.6% and 7.5%, respectively. Domestic chemical product prices decreased compared with the previous year, but experienced an upward trend, in line with movements of international chemical product prices.

 

 

 

 

	2016	2015	2014	Change from 2015 to 2016 (%)
Oil and gas production (mmboe)	431.29	471.91	480.22	(8.6)
Crude oil production (mmbbls)	303.51	349.47	360.73	(13.2)
China	253.15	296.34	310.87	(14.6)
Overseas	50.36	53.13	49.86	(5.2)
Natural gas production (bcf)	766.12	734.79	716.35	4.3

	Crude oil reserves (mmbbls)
Items	31 December 2016	31 December 2015
Proved reserves	1,552	2,243
Proved developed reserves	1,393	2,013
China	1,080	1,701
Consolidated subsidiaries	1,080	1,701
Shengli	801	1,326
Others	279	375
Overseas	313	312
Consolidated subsidiaries	40	52
Equity accounted entities	273	260
Proved undeveloped reserves	159	230
China	136	201
Consolidated subsidiaries	136	201
Shengli	37	116
Others	99	85
Overseas	23	29
Consolidated subsidiaries	0	3
Equity accounted entities	23	26

	Natural gas reserves (bcf)
Items	31 December 2016	31 December 2015
Proved reserves	7,178	7,570
Proved developed reserves	6,454	6,457
China	6,436	6,439
Consolidated subsidiaries	6,436	6,439
Puguang	2,330	2,470
Fuling	1,226	1,016
Others	2,880	2,953
Overseas	18	18
Consolidated subsidiaries	0	0
Equity accounted entities	18	18
Proved developed reserves	724	1,113
China	724	1,112
Consolidated subsidiaries	724	1,112
Fuling	0	181
Others	724	931
Overseas	0	1
Consolidated subsidiaries	0	0
Equity accounted entities	0	1

	Wells completed (as of 31 December)
	2016				2015
	Exploratory		Development		Exploratory		Development
Region	Productive	Dry	Productive	Dry	Productive	Dry	Productive	Dry
China	266	149	801	6	373	195	1,801	25
Consolidated subsidiaries	266	149	801	6	373	195	1,801	25
Shengli	166	73	462	5	150	73	1,020	18
Others	100	76	339	1	223	122	781	7
Overseas	2	1	99	0	0	1	149	1
Consolidated subsidiaries	0	0	0	0	0	0	5	0
Equity accounted entities	2	1	99	0	0	1	144	1
Total	268	150	900	6	373	196	1,950	26

	Wells being drilled (as of 31 December)
	2016				2015
	Gross		Net		Gross		Net
Region	Exploratory	Development	Exploratory	Development	Exploratory	Development	Exploratory	Development
China	78	138	78	138	110	152	110	152
Consolidated subsidiaries	78	138	78	138	110	152	110	152
Shengli	28	21	28	21	35	23	35	23
Others	50	117	50	117	75	129	75	129
Overseas	0	2	0	2	0	3	0	1
Consolidated subsidiaries	0	0	0	0	0	0	0	0
Equity accounted entities	0	2	0	2	0	3	0	1
Total	78	140	78	140	110	155	110	153

	Oil production wells (as of 31 December)
	2016		2015
Region	Gross	Net	Gross	Net
China	49,921	49,921	49,662	49,662
Consolidated subsidiaries	49,921	49,921	49,662	49,662
Shengli	32,019	32,019	31,547	31,547
Others	17,902	17,902	18,115	18,115
Overseas	7,432	3,614	6,913	3,122
Consolidated subsidiaries	28	14	28	15
Equity accounted entities	7,404	3,600	6,885	3,107
Total	57,353	53,535	56,575	52,784

	Natural gas production wells (as of 31 December)
	2016		2015
Region	Gross	Net	Gross	Net
China	4,966	4,932	4,758	4,727
Consolidated subsidiaries	4,966	4,932	4,758	4,727
Puguang	57	57	55	55
Fuling	253	253	175	175
Others	4,656	4,622	4,528	4,497
Total	4,966	4,932	4,758	4,727

	Area under license (as of 31 December)
	2016	2015
Regions with exploration licenses	742,588	857,420
China	742,588	857,420
Regions with development licenses	33,305	30,730
China	28,436	25,748
Overseas	4,869	4,982

	2016	2015	2014	Change from 2015 to 2016 (%)
Refinery throughput	235.53	236.49	235.38	(0.4)
Gasoline, diesel and kerosene production	149.17	148.38	146.23	0.5
Gasoline	56.36	53.98	51.22	4.4
Diesel	67.34	70.05	74.26	(3.9)
Kerosene	25.47	24.35	20.75	4.6
Light chemical feedstock production	38.54	38.81	39.17	(0.7)
Light product yield (%)	76.33	76.50	76.52	(0.17) percentage points
Refinery yield (%)	94.70	94.75	94.66	(0.05) percentage points

	2016	2015	2014	Change from 2015 to 2016 (%)
Total sales volume of oil products (million tonnes)	194.84	189.33	189.17	2.9
Total domestic sales volume of oil products (million tonnes)	172.70	171.37	170.97	0.8
Retail sales (million tonnes)	120.14	119.03	117.84	0.9
Direct sales and distribution (million tonnes)	52.56	52.34	53.13	0.4
Annual average throughput per station (tonne/station)	3,926	3,896	3,858	0.8

	31 December	31 December	31 December	Change from the end of the  previous year to the end of  the reporting period
	2016	2015	2014	(%)
Total number of service stations under the Sinopec brand	30,603	30,560	30,551	0.1
Number of company-operated stations	30,597	30,547	30,538	0.2

	2016	2015	2014	Change from 2015 to 2016 (%)
Ethylene	11,059	11,118	10,698	(0.5)
Synthetic resin	15,201	15,065	14,639	0.9
Synthetic rubber	857	843	939	1.7
Synthetic fiber monomer and polymer	9,275	8,994	8,383	3.1
Synthetic fiber	1,242	1,282	1,315	(3.1)

	Year ended 31 December
	2016	2015	Change
	RMB million	RMB million	(%)
Turnover and other operating revenues	1,930,911	2,020,375	(4.4)
Turnover	1,880,190	1,977,877	(4.9)
Other operating revenues	50,721	42,498	19.3
Operating expenses	(1,853,718)	(1,963,553)	(5.6)
Purchased crude oil, product and operating supplies and expenses	(1,379,691)	(1,494,046)	(7.7)
Selling, general and administrative expenses	(64,360)	(69,491)	(7.4)
Depreciation, depletion and amortisation	(108,425)	(96,460)	12.4
Exploration expenses, including dry holes	(11,035)	(10,459)	5.5
Personnel expenses	(63,887)	(56,619)	12.8
Taxes other than income tax	(232,006)	(236,349)	(1.8)
Other operating income/(expense), net	5,686	(129)	—
Operating profit	77,193	56,822	35.9
Net finance costs	(6,611)	(9,239)	(28.4)
Investment income and share of profits less losses from associates and joint ventures	9,569	8,828	8.4
Profit before taxation	80,151	56,411	42.1
Tax expense	(20,707)	(12,613)	64.2
Profit for the year	59,444	43,798	35.7
Attributable to:
Owners of the Company	46,672	32,512	43.6
Non-controlling interests	12,772	11,286	13.2

	Sales volume (thousand tonnes)			Average realised price (RMB/tonne, RMB/thousand cubic meters
	Year ended 31 December			Year ended 31 December
	2016	2015	Change (%)	2016	2015	Change (%)
Crude oil	6,808	9,674	(29.6)	1,628	2,019	(19.4)
Natural gas (million cubic meters)	19,008	18,440	3.1	1,258	1,519	(17.2)
Gasoline	77,480	69,749	11.1	6,386	6,749	(5.4)
Diesel	91,492	95,472	(4.2)	4,482	4,937	(9.2)
Kerosene	25,164	23,028	9.3	2,807	3,387	(17.1)
Basic chemical feedstock	32,248	29,608	8.9	4,054	4,175	(2.9)
Monomer and polymer for synthetic fibre	7,146	6,071	17.7	5,325	5,796	(8.1)
Synthetic resin	12,223	11,989	2.0	7,488	7,771	(3.6)
Synthetic fibre	1,369	1,380	(0.8)	7,113	7,740	(8.1)
Synthetic rubber	1,098	1,104	(0.5)	9,608	8,778	9.5
Chemical fertiliser	714	243	193.8	1,612	1,823	(11.6)

	Operating revenues		As a percentage of consolidated operating revenue before elimination of inter-segment sales		As a percentage of consolidated operating revenue after elimination of inter-segment sales
	Year ended 31 December		Year ended 31 December		Year ended 31 December
	2016	2015	2016	2015	2016	2015
	RMB million	RMB million	(%)	(%)	(%)	(%)
Exploration and Production Segment
External sales*	56,985	67,634	1.8	2.1	3.0	3.3
Inter-segment sales	58,954	71,019	1.9	2.2
Operating revenues	115,939	138,653	3.7	4.3
Refining Segment
External sales*	108,469	125,654	3.5	3.8	5.6	6.2
Inter-segment sales	747,317	800,962	24.2	24.4
Operating revenues	855,786	926,616	27.7	28.2
Marketing and Distribution Segment
External sales*	1,049,377	1,103,610	33.9	33.6	54.3	54.6
Inter-segment sales	3,480	3,056	0.1	0.1
Operating revenues	1,052,857	1,106,666	34.0	33.7
Chemicals Segment
External sales*	296,500	285,057	9.6	8.7	15.4	14.2
Inter-segment sales	38,614	43,814	1.2	1.3
Operating revenues	335,114	328,871	10.8	10.0
Corporate and Others
External sales*	419,580	438,420	13.5	13.3	21.7	21.7
Inter-segment sales	320,367	345,454	10.3	10.5
Operating revenues	739,947	783,874	23.8	23.8
Operating revenue before elimination of inter-segment sales	3,099,643	3,284,680	100.0	100.0
Elimination of inter-segment sales	(1,168,732)	(1,264,305)
Consolidated operating revenue	1,930,911	2,020,375			100.0	100.0

	Year ended 31 December
	2016	2015	Change
	RMB million	RMB million	(%)
Exploration and Production Segment
Operating revenues	115,939	138,653	(16.4)
Operating expenses	152,580	156,071	(2.2)
Operating (loss)/profit	(36,641)	(17,418)	—
Refining Segment
Operating revenues	855,786	926,616	(7.6)
Operating expenses	799,521	905,657	(11.7)
Operating profit/(loss)	56,265	20,959	168.5
Marketing and Distribution Segment
Operating revenues	1,052,857	1,106,666	(4.9)
Operating expenses	1,020,704	1,077,811	(5.3)
Operating profit	32,153	28,855	11.4
Chemicals Segment
Operating revenues	335,114	328,871	1.9
Operating expenses	314,491	309,395	1.6
Operating profit/(loss)	20,623	19,476	5.9
Corporate and Others
Operating revenues	739,947	783,874	(5.6)
Operating expenses	736,735	783,490	(6.0)
Operating profit/(loss)	3,212	384	736.5
Elimination of inter-segment profit	1,581	4,566	—

	Sales Volume (thousand tonnes)			Average realised price (RMB/tonne)
	Year ended 31 December			Year ended 31 December
	2016	2015	Change (%)	2016	2015	Change (%)
Gasoline	52,461	50,921	3.0	5,904	6,191	(4.6)
Diesel	58,734	63,359	(7.3)	4,505	4,797	(6.1)
Kerosene	14,529	13,518	7.5	2,814	3,420	(17.7)
Chemical feedstock	36,408	35,945	1.3	2,584	2,984	(13.4)
Other refined petroleum products	55,742	52,418	6.3	2,529	2,842	(11.0)

				Year ended 31 December
	2016	2015	Change (%)	2016	2015	Change (%)

	Sales Volume (Thousand tonnes)			Average realised price (RMB/tonne)
	Year ended 31 December			Year ended 31 December
	2016	2015	Change (%)	2016	2015	Change (%)
Gasoline	77,613	69,842	11.1	6,380	6,747	(5.4)
Retail	63,718	58,211	9.5	6,722	6,996	(3.9)
Direct sales and wholesale	13,895	11,630	19.5	4,812	5,498	(12.5)
Diesel	91,998	95,907	(4.1)	4,478	4,936	(9.3)
Retail	46,656	50,756	(8.1)	5,088	5,490	(7.3)
Direct sales and wholesale	45,342	45,150	0.4	3,851	4,314	(10.7)
Kerosene	25,164	23,028	9.3	2,807	3,387	(17.1)
Fuel	22,034	24,980	(11.8)	1,703	2,215	(23.1)

	Sales Volume (Thousand tonnes)			Average realised price (RMB/tonne)
	Year ended 31 December			Year ended 31 December
	2016	2015	Change (%)	2016	2015	Change (%)
Basic organic chemicals	41,605	38,903	6.9	3,963	4,121	(3.8)
Synthetic fibre monomer and polymer	7,169	6,083	17.9	5,328	5,797	(8.1)
Synthetic resin	12,250	11,993	2.1	7,482	7,771	(3.7)
Synthetic fibre	1,369	1,380	(0.8)	7,113	7,739	(8.1)
Synthetic rubber	1,099	1,107	(0.7)	9,609	8,769	9.6
Chemical fertiliser	714	243	193.8	1,612	1,823	(11.6)

	As of 31 December 2016	As of 31 December 2015	Change
Total assets	1,498,609	1,447,268	51,341
Current assets	412,261	333,657	78,604
Non-current assets	1,086,348	1,113,611	(27,263)
Total liabilities	667,374	659,107	8,267
Current liabilities	485,543	462,832	22,711
Non-current liabilities	181,831	196,275	(14,444)
Total equity attributable to owners of the Company	710,994	676,197	34,797
Share capital	121,071	121,071	—
Reserves	589,923	555,126	34,797
Non-controlling interests	120,241	111,964	8,277
Total equity	831,235	788,161	43,074

Major items of cash flows	Year ended 31 December
	2016	2015
Net cash generated from operating activities	214,543	165,740
Net cash used in investing activities	(66,217)	(116,719)
Net cash generated from/(used in) financing activities	(93,047)	9,093

Items	Beginning of the year	End of the year	Profits and losses from variation of fair values in the current year	Accumulated variation of fair values recorded as equity	Impairment loss provision of the current year	Funding source
Available-for-sale financial assets	261	262	—	56	—	Self-owned fund
Stock	261	262	—	56	—
Derivative financial instruments	403	314	(160)	—	—	Self-owned fund
Cash flow hedging instruments	4,722	(4,024)	11	(3,813)	—	Self-owned fund
Total	5,386	(3,448)	(149)	(3,757)	—

	Year ended 31 December
	2016	2015
	RMB million	RMB million
Operating income
Exploration and Production Segment	115,939	138,653
Refining Segment	855,786	926,616
Marketing and Distribution Segment	1,052,857	1,106,666
Chemicals Segment	335,114	328,871
Corporate and Others	739,947	783,874
Elimination of inter-segment sales	(1,168,732)	(1,264,305)
Consolidated operating income	1,930,911	2,020,375
Operating profit/(loss)
Exploration and Production Segment	(58,531)	(18,511)
Refining Segment	55,808	19,423
Marketing and Distribution Segment	32,385	27,299
Chemicals Segment	20,769	19,516
Corporate and Others	2,912	(678)
Elimination of inter-segment sales	1,581	4,566
Financial expenses, investment income and loss from changes in fair value	23,952	631
Consolidated operating profit	78,876	52,246
Net profit attributable to equity shareholders of the Company	46,416	32,281

	As of 31	As of 31
	December 2016	December 2015	Change
	RMB million	RMB million
Total assets	1,498,609	1,447,268	51,341
Long-term liabilities	180,541	194,871	(14,330)
Shareholders’ equity	832,525	789,565	42,960

Segments	Operation income RMB million	Operation cost RMB million	Gross profit margin* (%)	Increase/ (decrease) of operation income on a year-on-year  basis (%)	Increase/ (decrease) of operation cost on a year-on-year basis (%)	Increase/ (decrease) of gross profit margin on a year-on-year basis (%)
Exploration and Production	115,939	128,469	(15.3)	(16.4)	9.8	(26.5)
Refining	855,786	556,081	9.1	(7.6)	(15.5)	4.6
Marketing and Distribution	1,052,857	961,907	8.4	(4.9)	(5.9)	1.0
Chemicals	335,114	289,572	13.0	1.9	(0.2)	1.7
Corporate and Others	739,947	726,449	1.8	(5.6)	(6.2)	0.7
Elimination of inter-segment sales	(1,168,732)	(1,170,313)	N/A	N/A	N/A	N/A
Total	1,930,911	1,492,165	10.7	(4.4)	(6.5)	1.3

	Sinopec Corp.	Sinopec Corp.		Sinopec Corp.
Bond name	2010 Corporate bond	2012 Corporate bond		2016 Corporate bond (first issue)
Abbreviation	10石化02	12石化01	12石化02	15石化01	15石化02
Code	122052	122149	122150	136039	136040
Issuance date	21 May 2010	1 June 2012		19 November 2015
Maturity date	21 May 2020	1 June 2017	1 June 2022	19 November 2018	19 November 2020
Amount issued (RMB billion)	9	13	7	16	4
Outstanding balance (RMB billion)	9	13	7	16	4
Interest rate (%)	4.05	4.26	4.90	3.3	3.7

Principal and interest repayment	Simple interest is calculated and paid on an annual basis without compounding interests. The principal will be paid at maturity with last installment of interest.
Payment of interests	Sinopec Corp. had paid in full the interest accrued for the current period interest payment year.
Investor Qualification Arrangement	15石化01 and 15石化02 were publicly offered to qualified investors in accordance with Administration of the Issuance and Trading of Corporate Bonds
Listing place	Shanghai Stock Exchange
Corporate bonds trustee	China International Capital Corporation Limited
	27th-28th Floor, China World Office 2, 1 Jianguomenwai Avenue, Chaoyang District, Beijing
	Huang Xu, Zhai Ying
	(010) 6505 1166
Credit rating agency	United Credit ratings Co., Ltd.
	12th Floor, PICC building, No.2 Jianguomenwai Avenue, Chaoyang District, Beijing
Use of proceeds	Proceeds from the above-mentioned corporate bonds have been used for their designated purpose disclosed in the relevant announcements. All the proceeds have been completely used.
Credit rating agency	During the reporting period, United Credit ratings Co., Ltd. provided continuing credit rating for 10石化02, 12石化01, 12石化02, 15石化01 and 15石化02and reaffirmed AAA credit rating. The long term credit rating and outlook of Sinopec Corp. remained at AAA and stable respectively.
Credit addition mechanism, repayment scheme and other relative events for corporate bonds during the reporting period	During the reporting period, there is no credit addition mechanism and change of the repayment arrangement for the above-mentioned corporate bonds Sinopec Corp. strictly followed the provisions in the corporate bond prospectus to repay principals and interests of the corporate bonds.
Convening of corporate bond holders’ meeting	During the reporting period, the bondholders’ meeting has not been convened.
Performance of corporate bonds trustee	During the durations of the above-mentioned bonds, the bond trustee, China International Capital Corporation Limited, has strictly followed the Bond Trustee Management Agreement and continuously tracked the company’s credit status, utilisation of bond proceeds and repayment of principals and interests of the bond. The bond trustee has also advised the company to satisfy obligations as described in the corporate bond prospectus and exercised its duty to protect the bondholders’ legitimate rights and interests. The bond trustee is expected to disclose the Trustee Management Affairs Report after disclosure of the company’s annual report. The full disclosure will be available on the website of Shanghai Stock Exchange (http://www.sse.com.cn)

Principal data	2016	2015	Change	Reasons for change
EBITDA (RMB million)	196,464	159,605	23.09%	Mainly due to the increase of earnings compared with last year
Current ratio	0.85	0.72	0.13	Mainly due to the significant increase of cash at bank and on hand
Quick ratio	0.53	0.41	0.12	Mainly due to the significant increase of cash at bank and on hand
Liability-to-asset ratio (%)	44.45	45.44	(0.99) percentage points	Mainly due to improvement of cash flow from operating activities
EBITDA to total debt ratio	0.99	0.62	0.37	Mainly due to the increase of earnings and decrease of debts
Interest coverage ratio	9.85	7.78	2.07	Mainly due to the increase of earnings
Cash flow interest coverage ratio	35.13	23.07	12.06	Mainly due to the improvement of the cash flow from operating  activities
EBITDA-to-interest coverage ratio	21.78	19.29	2.49	Mainly due to the increase of earnings
Loan repayment rate (%)	100	100	—
Interest payment rate (%)	100	100	—

Name	Position	No. of share options held at the end of the reporting period	Percentage of total share capital (%)	Percentage of total H share capital (%)	Status
Wang Zhiqing	Chairman and President	500,000(L)	0.005	—	Beneficial owner
Gao Jinping	Vice Chairman and Vice President	500,000(L)	0.005	—	Beneficial owner
Ye Guohua*	Director, Vice President and Chief Financial Officer	430,000(L)	0.004	—	Beneficial owner
Jin Qiang	Director and Vice President	430,000(L)	0.004	—	Beneficial owner
Guo Xiaojun	Director and Vice President	430,000(L)	0.004	—	Beneficial owner
Jin Wenmin	Vice President	250,000(L)	0.002	—	Beneficial owner

Background	Type of Undertaking	Party	Contents		Term for performance	Whether bears deadline or not	Whether strictly performed or not
Undertakings related to Initial Public Offerings (IPOs)	Initial Public Offerings (IPOs)	China Petrochemical Corporation	1	Compliance with the connected transaction agreements;	From 22 June 2001	No	Yes
(IPOs)			2	Solving the issues regarding the legality of land-use rights certificates and property ownership rights certificates within a specified period of time;
			3	Implementation of the Reorganisation Agreement (please refer to the definition of Reorganisation Agreement in the H share prospectus of Sinopec Corp.);
			4	Granting licenses for intellectual property rights;
			5	Avoiding competition within the same industry;
			6	Abandonment of business competition and conflicts of interest with Sinopec Corp.
Other undertakings	Other	China Petrochemical Corporation	China Petrochemical Corporation would dispose of its minor remaining chemicals business within five years in order to avoid competition with Sinopec Corp. in the chemicals business.		Within five years, commencing from 15 March 2012	Yes	Yes
Other undertakings	Other	China Petrochemical Corporation	Given that China Petrochemical Corporation engages in the same or similar businesses as Sinopec Corp. with regard to the exploration and production of overseas petroleum and natural gas, China Petrochemical Corporation hereby grants a 10-year option to Sinopec Corp. with the following provisions: (i) after a thorough analysis from political, economic and other perspectives, Sinopec Corp. is entitled to require China Petrochemical Corporation to sell its overseas oil and gas assets owned as of the date of the undertaking and still in its possession upon Sinopec Corp.’s exercise of the option to Sinopec Corp.; (ii) in relation to the overseas oil and gas assets acquired by China Petrochemical Corporation after the issuance of the undertaking, within 10 years of the completion of such acquisition, after a thorough analysis from political, economic and other perspectives, Sinopec Corp. is entitled to require China Petrochemical Corporation to sell these assets to Sinopec Corp. China Petrochemical Corporation undertakes to transfer the assets as required by Sinopec Corp. under aforesaid items (i) and (ii) to Sinopec Corp., provided that the exercise of such option complies with applicable laws and regulations, contractual obligations and other procedural requirements.		Within 10 years after 29 April 2014 or the date when China Petrochemical Corporation acquires the assets	Yes	Yes

Guarantor	Relationship with the Company	Name of guaranteed company	Amount	Transaction date (date of signing)	Period of guarantee	Type	Whether completed or not	Whether overdue or not	Amount of overdue guarantee	Counter- guaranteed	Whether guaranteed for connected parties (yes or no)*1
Sinopec Corp.	The listed company itself	Yueyang Sinopec Corp. Shell Coal Gasification Corporation	68	10 December 2003	10 December 2003 – 10 December 2017	Joint obligations	No	No	—	No	No
Sinopec Corp.	The listed company itself	Zhongtian Hechuang Energy Co., Ltd	11,545	25 May 2016	25 May 2016 –31 December 2023(the mature date is estimated)10 December 2017	Joint obligations	No	No	—	No	Yes
Sinopec Corp.	The listed company itself	Yanbu Aramco Sinopec Refining Company (YASREF) Limited	no specific amount agreed, gurarantee on contract performance	31 December 2014	30 years from the date YASRFE requires supply of hydrogen from Air Liquedie Arabia LLC.	Joint obligations	No	No	—	No	No
Sinopec Great  Wall Energy  and Chemical  Industry  Co., LTD	Wholly owned subsidiary	Zhong An United Coal Chemical Co., Ltd.	590	18 April 2014	18 April 2014 – 17 April 2026	Joint obligations	No	No	—	No	No
SSI	Controlled subsidiary	New Bright International Development Ltd./Sonangol E.P.	10,669			Joint obligations	No	No	—	Yes	No

Total amount of guarantees provided during the reporting period*2	14,108
Total amount of guarantees outstanding at the end of reporting period*2 (A)	18,071
Guarantees by the Company to the controlled subsidiaries
Total amount of guarantee provided to controlled subsidiaries during the reporting period	None
Total amount of guarantee for controlled subsidiaries outstanding at the end of the reporting period (B)	18,985
Total amount of guarantees for the Company (including those provided for controlled subsidiaries)
Total amount of guarantees(A+B)	37,056
The proportion of the total amount of guarantees to the Sinopec Corp.’s net assets	5.20%
Guarantees provided for shareholder, de facto controller and its related parties (C)	2,248
Amount of debt guarantees provided directly or indirectly to the companies with liabilities to assets ratio over 70% (D)	2,534
The amount of guarantees in excess of 50% of the net assets (E)	None
Total amount of the above three guarantee items (C+D+E)	4,782
Statement of guarantee undue that might be involved in any joint and several liabilities	None
Statement of guarantee status	None

Borrower	Amount (RMB billion)	Term	Interest Rate	Purpose	Mortgage or guarantor	Whether overdue or not	Whether connected transaction or not	Whether roll-over or not	Whether involved in lawsuit or not	Connected relationship	Gain or loss
Ningbo Gaotou Petroleum Development, Ltd.	0.2	5 years	6.00%	Working capital loan	None	No	No	No	No	Joint Venture	Gain
Maoming-BASF, Ltd.	0.6	5 years	4.75%	Project construction	None	No	No	No	No	Joint Venture	Gain

I.	Overview
	1.	Funds					100.56
	2.	Value of goods and materials					4.89
	3.	Number of people lifted out of poverty					27,775
II.	Investment breakdowns
	1.	Poverty elimination through industrial development
		1.1	Categories of poverty alleviation programs through industrial development	☑		Poverty alleviation through agriculture and forestry development
				□		Poverty alleviation through tourism development
				☑		Poverty alleviation through e-commerce
				☑		Poverty alleviation through assets income
				☑		Poverty alleviation through science and technology development
				□		Others
		1.2	Number of poverty alleviation programs				208
		1.3	Investment in poverty alleviation projects through industrial development				38.42
		1.4	Number of people lifted out of poverty				12,269
	2.	Poverty elimination through provision of employment
		2.1	Investment in professional skill training				2.27
		2.2	Participants of professional skill trainings (person time)				2,733
		2.3	Number of people employed				1,589
	3.	Poverty elimination through relocation
		3.1	Number of relocated people provided with employment				94
		3.2	Investment in poverty alleviation projects through relocation				1.21
	4.	Poverty elimination through education
		4.1	Investment in students funding				3.15
		4.2	Number of students who received funding assistance				2,797
		4.3	Investment in education resources in poverty-stricken areas				2.48
	5.	Poverty alleviation through healthcare
		5.1	Investment in medical and health care resources in proverty-striken areas				6.24
	6.	Poverty alleviation through ecological protection
		6.1	Items	☑	Conduct ecological protection and construction
				□	Develop ways for ecological protection and compensation
				☑	Set up ecological public welfare positions
				□	Others
		6.2	Investment in ecological protection				1.79
	7.	Guarantee basic living standard
		7.1	Investment in left-behind children, women and senior people				1.46
		7.2	Number of left-behind children, women and senior people assisted				829
		7.3	Investment in assisting the disabled				0.44
		7.4	Number of the disabled helped				424
	8.	Poverty alleviation through social projects
		8.1	Investment in coordinated poverty alleviation in East and West China				0.02
		8.2	Investment in targeted poverty alleviation programs				7.09
		8.3	Public Welfare funds for poverty alleviation				0.06
	9.	Other projects
		9.1	Number of projects				220
		9.2	Total investment				44.97
		9.3	Number of people lifted out of poverty				15,506
		9.4	Other projects overview	Other investments include external fund raised by the employee from our subsidiaries who participated in the poverty elimination plans

		Funds to related parties			Funds from related parties
Related Parties	Relations	Balance at the beginning of the year	Amount incurred	Balance at the end of the year	Balance at the beginning of the year	Amount incurred	Balance at the end of the year
Sinopec Group	Parent company and affiliated companies*	20,485	5,979	26,464	26,669	2,872	29,541
Other related parties	Associates and joint ventures	5,472	536	6,008	174	(119)	55
Total		25,957	6,515	32,472	26,843	2,753	29,596

Reason for provision of funds between related parties	Loans and other accounts receivable and accounts payable
Impacts on the Company	No material negative impact

Director Titles	Names	Board Meetings
		No. of meeting held	Actual Attendence	Attended By communication	Attended by proxy	Absent
Chairman	Wang Yupu	6	6	4	0	0
Vice Chairman	Dai Houliang	6	6	4	0	0
Director	Wang Zhigang	6	6	4	0	0
Director	Zhang Haichao	6	6	4	0	0
Director	Jiao Fangzheng	6	6	4	0	0
Director	Ma Yongsheng	6	6	4	0	0
Independent Director	Jiang Xiaoming	6	5	4	1	0
Independent Director	Andrew Y. Yan	6	6	5	0	0
Independent Director	Tang Min	6	6	4	0	0
Independent Director	Fan Gang	6	6	4	0	0

Director Titles	Names	Board Meetings*1
		No. of meeting held	Actual Attendence	Attended By communication	Attended by proxy	Absent
Former Director	Li Chunguang	4	4	0	0	0
Former Director	Zhang Jianhua	2	1	0	1	0

	2016*	2015	2014
Cash dividends (RMB/Share, tax inclusive)	0.249	0.15	0.20
Total amount of cash dividends (RMB million, tax inclusive)	30,147	18,160	23,830
Net profits attributed to the shareholders of the listed company shown in the consolidated statement for the dividend year (RMB million)	46,416	32,281	47,603
Ratio between the dividends and the net profit attributed to the shareholders of the listed company in the consolidated statement (%)	64.95	56.26	50.06