about us

Chairman's Address

Year 2017 was a milestone for both China and our company. The 19th National Congress of CPC marked the start of securing a decisive victory in building a moderately prosperous society in all respects and a new journey for building a modern socialist country, pooling all strengths of the Chinese people together. In the past year, we also achieved satisfying results in operations and exceeded our targets thanks to concerted effort by all our staff under the leadership of the CPC with Xi Jinping as the general secretary. We were able to grow the company, improve its development quality and keep good momentum while maintaining stable operations. The company recorded a revenue of 2.40 trillion yuan, up by 21.8%, generated a profit of 58.2 billion yuan, up by 10%, and our tax contribution reached 362.3 billion yuan, up by 2.5%.

We focused on optimizing our operations. In China, we reversed the trend of declining reserve replacement ratio and increasing cost in upstream, and we produced 35.05 million tonnes of crude oil and 25.74 billion cubic meters of natural gas. Our overseas cash operating cost per barrel was lowered further while equity production reached 43.72 million tonnes of oil equivalent. Collaboration between the refining and marketing segments was enhanced to effectively address competition in the market. Our refining throughput was 240 million tonnes, and marketing volume of oil products in the home market was 178 million tonnes. We continued to benefit from chemical products slate adjustment, producing 11.61 million tonnes of ethylene and 4.63 million tonnes of PX, and hitting new highs in ethylene yield and high value-added products ratio. We also achieved the best record of chemicals marketing volume of 78.5 million tonnes, expanded markets for other refined products and natural gas, and increased high-end lubricants and export of catalysts.

We pushed ahead with transforming our growth pattern. The Fuling shale gas project was completed by reaching 10 billion cubic meters/year capacity while we made a number of new oil and gas discoveries in Xinjiang and other areas. Construction for the Zhongke integrated refining and petrochemical project was kicked off, the acquisition of Shanghai SECCO equity was completed, and the Zhongtianhechuang coal chemical project was put into commercial operation. The non-fuel business recorded significant growth, and the e-commerce platform EPEC's partnership with BRICS was listed among the eight key deliverables by BRICS in 2017. Chememall and other trading platform grew fast while the geothermal business was further incorporated into the planning of Xiongan New District. We also saw steady progress in finance and capital operation. We were actively engaged with the Belt and Road Initiative, won two offshore exploration blocks in Brazil, increased the weight of overseas revenue in engineering services for both upstream and downstream, and further grew international trade. Our achievements in R&D for key technologies were also remarkable with three first prizes of national science and technology advancement, and two second prizes of national science and technology invention, keeping a leading position in terms of licenses among central SOEs.

We went on with the programme of deepening reform, meeting the annual target of consolidating subsidiaries operating in extreme difficulties and reducing enterprises running losses by 15.9 percentage points. Streamlining also went well with 116 legal entities cut. Agreements signed for transfer of functions of supplying heat, water, electricity and steam and property management accounted 70% of total targets. Sinopec Oilfield Service Corporation further improved its capital structure by completing a private placement. The preparation for Sinopec marketing business IPO progressed smoothly, and mixed ownership reform scheme for the geothermal business of Sinopec Star Petroleum Corp. took shape. We were the first among all central SOEs to set up a shared services company, improving resources sharing internally and preparing for doing businesses externally.

We strengthened governance of the Party by promoting the study of the spirit of the 19th National Congress of CPC, enhancing awareness of Party members and all employees, and putting in place stringent performance evaluation of Party construction work. The decision to incorporate Party construction into the company's Articles of Association was approved by winning 99.96% votes, in which 99.68% votes of our overseas shareholders (representing 13.2 billion shares) were in favour. We also improved our human resources work by adopting higher selection criteria to make management at the subsidiaries stronger. Discipline and correction of identified problems were emphasized, and anti-corruption and clean conduct were strengthened, nurturing a healthy environment for the company. The traditional values of being stringent, attending to details, and adopting pragmatic approach in work were upheld and encouraged.

We shouldered our corporate social responsibility by pushing forward the targeted poverty alleviation work and invested 136 million yuan in 2017 to designated regions. We also continued with social welfare programmes including sponsoring the Lifeline Express, which had cured more than 40,000 cataract patients for free. The “station that cares” programme provided free services to tens of thousands migrant workers travelling home during the Chinese New Year, while the “Sinopec Open Day” event promoted communications and understanding between the public and the company. We made every effort in increasing gas supply to citizens while reducing supply to other users during the supply shock in winter. We also completed the quality upgrading for gasoline and diesel, played an active role in fighting pollution in “2+26” cities, and mapped out a green enterprise initiative, contributing to environmental protection.

The achievements were not won easily. We credit them to the leadership of the Party, to the support from all walks of the society, to the trust from our clients and customers and to the cooperation with our partners. On behalf of the Board of Directors, I’d like to thank all of you for your kindest help and support.

Year 2018 marks the beginning of implementing the spirit of the 19th CPC National Congress and the 40th Anniversary of China's reform and opening-up. It is also a critical year in securing a decisive victory in building a moderately prosperous society in all respects. Additionally, it also marks the 35th Anniversary of our company and 20th Anniversary since our reorganization. Standing at this new starting point, we have set our vision of building a world leading energy and chemical company to answer the call by the central government, and we will achieve this goal in phases of “two 3-years and two 10-years”. We firmly believe that as long as we are committed to our vision and work with concerted effort and determination, we can realize our goal. Under the CPC leadership with Xi Jinping at the core, we will carry out our strategies, focus on quality and profit, stick to sharpening our competitive edge, press ahead with reform and innovation, seizing opportunities and riding the trend, so as to make greater contribution to the country.

We have a well-designed road map ahead of us, and we are confident to embrace new achievements. We look forward to working with you together on this journey.