Current Report by Foreign Issuer (SEC Filing - 6-K)

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 April 2021

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 ✔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 ✔

(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 2020 annual report of China Petroleum & Chemical Corporation (the 'Registrant'), filed by the Registrant with The Stock Exchange of Hong Kong Limited.

2	Company Profile

3	Principal Financial Data and Indicators

6	Changes in Share Capital and Shareholdings of Principal Shareholders

8	Chairman's Address

11	Business Review and Prospects

19	Management's Discussion and Analysis

31	Significant Events

40	Connected Transactions

43	Corporate Governance

51	Report of the Board of Directors

58	Report of the Board of Supervisors

60	Directors, Supervisors, Senior Management and Employees

76	Principal Wholly-owned and Controlled Subsidiaries

77	Financial Statements

211	Corporate Information

212	Documents for Inspection

	For the year ended 31 December
	2020	2019 (adjusted)	2019 (before adjustment)	Change	2018 (adjusted)	2018 (before adjustment)
Items	RMB million	RMB million	RMB million	(%)	RMB million	RMB million
Operating income	2,105,984	2,959,799	2,966,193	(28.8)	2,882,077	2,891,179
Operating income other than principal activities	67,501	77,023	65,705	(12.4)	78,152	65,566
Operating income from principal activities	2,038,483	2,882,776	2,900,488	(29.3)	2,803,925	2,825,613
Operating profit	50,331	90,134	90,025	(44.2)	101,625	101,474
Profit before taxation	47,969	90,111	90,016	(46.8)	100,731	100,502
Net profit attributable to equity shareholders of the Company	32,924	57,619	57,591	(42.9)	63,179	63,089
Net profit attributable to equity shareholders of the Company excluding extraordinary gains and losses	(1,565)	54,280	54,271	(102.9)	59,633	59,630
Net cash flow from operating activities	167,518	153,619	153,420	9.0	175,937	175,868

	For the year of 2020
	First	Second	Third	Fourth
	Quarter	Quarter	Quarter	Quarter	Total
Items	RMB million	RMB million	RMB million	RMB million	RMB million
Operating income	554,482	478,582	519,337	553,583	2,105,984
Net profit attributable to equity shareholders of the Company	(19,866)	(3,135)	46,435	9,490	32,924
Net profit attributable to equity shareholders of the Company excluding extraordinary gains and losses	(20,444)	(3,960)	14,147	8,692	(1,565)
Net cash flow from operating activities	(67,970)	108,335	43,824	83,329	167,518

	As of 31 December
	2020	2019 (adjusted)	2019 (before adjustment)	Change	2018 (adjusted)	2018 (before adjustment)
Items	RMB million	RMB million	RMB million	(%)	RMB million	RMB million
Total assets	1,733,805	1,760,286	1,755,071	(1.5)	1,597,402	1,592,308
Total liabilities	849,929	881,912	878,166	(3.6)	738,280	734,649
Total equity attributable to equity shareholders of the Company	742,463	739,965	739,169	0.3	719,148	718,355
Total number of shares (1,000 shares)	121,071,210	121,071,210	121,071,210	-	121,071,210	121,071,210

	For the year ended 31 December
	2020	2019 (adjusted)	2019 (before adjustment)	Change	2018 (adjusted)	2018 (before adjustment)
Items	RMB	RMB	RMB	(%)	RMB	RMB
Basic earnings per share	0.272	0.476	0.476	(42.9)	0.522	0.521
Diluted earnings per share	0.272	0.476	0.476	(42.9)	0.522	0.521
Basic earnings per share (excluding extraordinary gains and losses)	(0.013)	0.448	0.448	(102.9)	0.492	0.493
Weighted average return on net assets (%)	4.44	7.90	7.90	(3.46) percentage points	8.67	8.67
Weighted average return (excluding extraordinary gains and losses) on net assets (%)	(0.21)	7.44	7.45	(7.65) percentage points	8.18	8.20
Net cash flow from operating activities per share	1.384	1.269	1.267	9.1	1.453	1.453

	As of 31 December
	2020	2019 (adjusted)	2019 (before adjustment)	Change	2018 (adjusted)	2018 (before adjustment)
Items	RMB	RMB	RMB	(%)	RMB	RMB
Net assets attributable to equity shareholders of the Company per share	6.132	6.112	6.105	0.3	5.940	5.933
Liabilities to assets ratio (%)	49.02	50.1	50.04	(1.08)	46.22	46.14
				percentage
				points

(3)

Extraordinary items and corresponding amounts

	For the year ended 31 December
	(Income)/expenses
	2020	2019	2018
Items	RMB million	RMB million	RMB million
Net (gain)/loss on disposal of non-current assets	(973)	1,318	742
Donations	301	209	180
Government grants	(8,605)	(6,857)	(7,482)
Gain on holding and disposal of business and various investments	(37,520)	(410)	(1,023)
Other non-operating expenses, net	2,992	634	1,383
Subtotal	(43,805)	(5,106)	(6,200)
Tax effect	6,611	1,642	2,377
Total	(37,194)	(3,464)	(3,823)
Attributable to: Equity shareholders of the Company	(34,489)	(3,339)	(3,546)
Minority interests	(2,705)	(125)	(277)

(4)

Items measured by fair values

				Influence
	Beginning	End		on the profit
Items	of the year	of the year	Changes	of the year
Other equity instruments	1,521	1,525	4	156
Derivative financial instruments	48	157	109	(1,252)
Cash flow hedging	(1,940)	7,545	9,485	2,886
Financial assets held for trading	3,319	1	(3,318)	114
Total	2,948	9,228	6,280	1,904

(5)

Significant changes of items in the financial statements

	As of 31 December	Increase/(decrease)
	2020	2019	Amount	Percentage
Items	RMB million	RMB million	RMB million	(%)	Reasons for change
Cash at bank and on hand	184,412	128,052	56,360	44.01	Cash received from pipeline business transaction and the impact of decrease in inventory and accounts receivable.
Financial assets held for trading	1	3,319	(3,318)	(99.97)	Structured deposit withdrawal at maturity of RMB 3.3 billion.
Derivative financial assets	12,528	837	11,691	1,396.77	Mainly due to increased floating earning from crude oil hedging.
Accounts receivable	35,587	54,375	(18,788)	(34.55)	Mainly due to strengthened cash flow management and decreased product selling price.
Short-term loans	20,756	31,196	(10,440)	(33.47)	Short-term loans repayment at maturity.
Non-current liabilities due within one year	22,493	69,490	(46,997)	(67.63)	Mainly due to the repayment of non-interest maturity loan of shareholder.
Debentures payable	38,356	19,157	19,199	100.22	Mainly due to mid-term notes with a total amount of RMB 20 billion in the first half of 2020.
Cash paid for goods and services	(1,754,016)	(2,591,739)	837,723	(32.32)	Mainly due to decrease in crude oil price and business scale.
Cash received from disposal of investments	11,651	35,996	(24,345)	(67.63)	Decrease in received structured deposit.
Net cash received from disposal of subsidiaries and other business entities	49,869	-	49,869	-	Cash received from selling the pipeline business.

	For the year ended 31 December
Items	2020	2019	2018	2017	2016
Turnover and other operating revenues	2,105,984	2,959,799	2,882,077	2,348,931	1,923,273
Operating profit	13,193	86,374	82,564	71,817	77,664
Profit before taxation	48,143	90,022	99,339	86,964	80,544
Profit attributable to shareholders of the Company	33,096	57,493	61,708	51,384	46,884
Basic earnings per share (RMB)	0.273	0.475	0.51	0.424	0.387
Diluted earnings per share (RMB)	0.273	0.475	0.51	0.424	0.387
Return on capital employed (%)	6.22	8.98	9.24	8.27	7.32
Return on net assets (%)	4.46	7.78	8.59	7.07	6.59
Net cash generated from operating activities per share (RMB)	1.384	1.269	1.453	1.579	1.770

	As of 31 December
Items	2020	2019	2018	2017	2016
Non-current assets	1,278,410	1,312,976	1,091,930	1,069,984	1,089,911
Net current liabilities	66,795	132,668	63,140	52,101	74,970
Non-current liabilities	328,757	303,004	170,792	163,374	181,941
Non-controlling interests	141,364	138,358	139,921	127,509	121,046
Total equity attributable to shareholders of the Company	741,494	738,946	718,077	727,000	711,954
Net assets per share (RMB)	6.124	6.103	5.931	6.005	5.880
Adjusted net assets per share (RMB)	5.914	5.953	5.748	5.875	5.816

Name of shareholders	Nature of Shareholders	Percentage of shareholdings %	Total number of shares held	Changes of shareholding1	Number of shares subject to pledges or lock-up
China Petrochemical Corporation	State-owned Share	68.31	82,709,227,393	0	0
HKSCC Nominees Limited2	H Share	20.97	25,385,280,408	(2,128,597)	unknown
中國證券金融股份有限公司	A Share	2.16	2,609,312,057	0	0
香港中央結算有限公司	A Share	0.69	841,072,282	269,227,962	0
中國人壽保險股份有限公司－分紅－個人分紅－005L－FH002滬	A Share	0.67	815,670,168	605,892,688	0
中國人壽保險股份有限公司－傳統－普通保險產品－005L－CT001滬	A Share	0.67	814,606,031	643,272,938	0
中央滙金資產管理有限責任公司	A Share	0.27	322,037,900	0	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	0.08	99,590,176	(3,491,593)	0
全國社保基金一一六組合	A Share	0.07	85,968,400	85,968,400	0
滙添富基金管理股份有限公司－社保基金1103組 合	A Share	0.06	70,000,000	(40,000,000)	0

Note 1:

As compared with the number of shares held as of 31 December 2019.

Note 2:

Sinopec Century Bright Capital Investment Limited, an overseas wholly-owned subsidiary of China Petrochemical Corporation, held 553,150,000 H shares, accounting for 0.46% of the total issued share capital of Sinopec Corp. Those shareholdings are included in the total number of the shares held by HKSCC Nominees Limited.

(2)

Information disclosed by the shareholders of H shares in accordance with the Securities and Futures Ordinance (SFO) as of 31 December 2020

Name of shareholders	Status of shareholders	Number of shares interested	% of Sinopec Corp.'s issued voting shares (H Share)
Citigroup Inc.	Person having a security interest in shares	7,810,000 (L)	0.03 (L)
	Interest of corporation controlled by	121,092,483 (L)	0.47 (L)
	the substantial shareholder	119,342,984 (S)	0.47 (S)
	Approved lending agent	2,167,641,996 (L)	8.50 (L)
GIC Private Limited	Investment manager	1,531,058,022 (L)	6.00 (L)
BlackRock, Inc.	Interest of corporation controlled by	1,510,306,390 (L)	5.92 (L)
	the substantial shareholder	1,709,000 (S)	0.01 (S)
Schroders Plc	Investment manager	1,291,515,302 (L)	5.06 (L)

(1)

Issuance of securities during the reporting period

(2)

Existing employee shares

(1)

Controlling shareholder

	Number of	Shareholding
Name of Company	Shares Held	Percentage
Sinopec Engineering (Group) Co. Ltd.	2,907,856,000	65.67%
Sinopec Oilfield Service Corporation	10,727,896,364	56.51%
Sinopec Oilfield Equipment Corporation	456,756,300	58.74%
China Merchants Energy Shipping Co., Ltd.	912,886,426	13.54%

Note:

China Petrochemical Corporation holds 2,595,786,987 H shares of Sinopec Oilfield Service Corporation (the 'SSC') through Sinopec Century Bright Capital Investment Ltd., a wholly-owned overseas subsidiary of China Petrochemical Corporation, accounting for 13.67% of the total share capital of SSC. Such shareholdings are excluded from the total shares of SSC directly held by China Petrochemical Corporation indicated above.

(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

(4)

Diagram of the equity and controlling relationship between Sinopec Corp. and its de facto controller

(1)

Crude Oil & Natural Gas Market

(2)

Refined Oil Products Market

(3)

Chemical Products Market

(1)

Exploration and Production

				Change from
	2020	2019	2018	2019 to 2020(%)
Oil and gas production (mmboe)	459.02	458.92	451.46	0.02
Crude oil production (mmbbls)	280.22	284.22	288.51	(1.4)
China	249.52	249.43	248.93	0.0
Overseas	30.70	34.79	39.58	(11.8)
Natural gas production (bcf)	1,072.33	1,047.78	977.32	2.3

	Crude oil reserves (mmbbls)
Items	31 December 2020	31 December 2019
Proved reserves	1,542	1,741
Proved developed reserves	1,389	1,588
China	1,130	1,326
Consolidated subsidiaries	1,130	1,326
Shengli	821	982
Others	309	344
Overseas	259	262
Consolidated subsidiaries	15	17
Equity accounted entities	244	245
Proved undeveloped reserves	153	153
China	102	107
Consolidated subsidiaries	102	107
Shengli	16	12
Others	86	95
Overseas	51	46
Consolidated subsidiaries	5	0
Equity accounted entities	46	46

	Natural gas reserves (bcf)
Items	31 December 2020	31 December 2019
Proved reserves	8,191	7,225
Proved developed reserves	6,365	6,035
China	6,357	6,026
Consolidated subsidiaries	6,357	6,026
Puguang	1,675	1,814
Fuling	1,491	1,315
Others	3,191	2,897
Overseas	8	9
Consolidated subsidiaries	0	0
Equity accounted entities	8	9
Proved undeveloped reserves	1,826	1,190
China	1,824	1,190
Consolidated subsidiaries	1,824	1,190
Fuling	119	65
Others	1,705	1,125
Overseas	2	0
Consolidated subsidiaries	0	0
Equity accounted entities	2	0

	Wells drilled (as of 31 December)
	2020		2019
	Exploratory	Development	Exploratory	Development
	Productive	Dry	Productive	Dry	Productive	Dry	Productive	Dry
China	383	136	2,015	3	350	174	2,098	5
Consolidated subsidiaries	383	136	2,015	3	350	174	2,098	5
Shengli	204	64	1,080	2	195	81	1,168	4
Others	179	72	935	1	155	93	930	1
Overseas	2	0	100	0	3	1	99	0
Consolidated subsidiaries	0	0	4	0	0	0	0	0
Equity accounted entities	2	0	96	0	3	1	99	0
Total	385	136	2,115	3	353	175	2,197	5

	Wells drilling (as of 31 December)
	2020	2019
	Gross	Net	Gross	Net
	Exploratory	Development	Exploratory	Development	Exploratory	Development	Exploratory	Development
China	92	212	92	212	117	177	117	176
Consolidated subsidiaries	92	212	92	212	117	177	117	176
Shengli	29	52	29	52	60	20	60	20
Others	63	160	63	160	57	157	57	156
Overseas	2	0	2	0	0	0	0	0
Consolidated subsidiaries	0	0	0	0	0	0	0	0
Equity accounted entities	2	0	2	0	0	0	0	0
Total	94	212	94	212	117	177	117	176

	Oil productive wells (as of 31 December)
	2020	2019
	Gross	Net	Gross	Net
China	53,240	53,240	52,112	52,112
Consolidated subsidiaries	53,240	53,240	52,112	52,112
Shengli	34,572	34,572	33,819	33,819
Others	18,668	18,668	18,293	18,293
Overseas	7,055	2,752	7,248	2,855
Consolidated subsidiaries	28	10	28	14
Equity accounted entities	7,027	2,742	7,220	2,841
Total	60,295	55,992	59,360	54,967

	Natural gas productive wells (as of 31 December)
	2020	2019
Region	Gross	Net	Gross	Net
China	6,976	6,928	6,420	6,378
Consolidated subsidiaries	6,976	6,928	6,420	6,378
Puguang	67	67	61	61
Fuling	632	632	482	482
Others	6,277	6,229	5,877	5,835
Total	6,976	6,928	6,420	6,378

	Area under license (as of 31 December)
	2020	2019
Acreage with exploration licenses	436,864	472,017
China	436,864	472,017
Acreage with development licenses	39,195	38,697
China	33,965	33,467
Overseas	5,230	5,230

(2)

Refining

				Change from
	2020	2019	2018	2019 to 2020 (%)
Refinery throughput	236.91	248.52	244.01	(4.7)
Gasoline, diesel and kerosene production	141.50	159.99	154.79	(11.6)
Gasoline	57.91	62.77	61.16	(7.7)
Diesel	63.21	66.06	64.72	(4.3)
Kerosene	20.38	31.16	28.91	(34.6)
Light chemical feedstock production	40.22	39.78	38.52	1.1
Light product yield (%)	74.34	76.38	76.00	(2.04) percentage points
Refinery yield (%)	94.77	94.98	94.93	(0.21) percentage points

(3)

Marketing and Distribution

				Change from
	2020	2019	2018	2019 to 2020 (%)
Total sales volume of oil products (million tonnes)*	217.91	254.95	237.69	(14.5)
Total domestic sales volume of oil products (million tonnes)	167.99	184.45	180.24	(8.9)
Retail sales (million tonnes)	113.19	122.54	121.64	(7.6)
Direct sales and distribution (million tonnes)	54.80	61.91	58.61	(11.5)
Annual average throughput per station (tonne/station)	3,686	3,992	3,979	(7.7)

	31 December 2020	31 December 2019	31 December 2018	Change from the end of the previous year to the end of the reporting period (%)
Total number of service stations under the Sinopec brand	30,713	30,702	30,661	0.04
Number of company-operated stations	30,707	30,696	30,655	0.04

(4)

Chemicals

Summary of Operations for the Chemicals Segment

Unit: thousand tonnes

				Change from
	2020	2019	2018	2019 to 2020 (%)
Ethylene	12,060	12,493	11,512	(3.5)
Synthetic resin	17,370	17,244	15,923	0.7
Synthetic rubber	1,067	1,047	896	1.9
Synthetic fiber monomer and polymer	9,057	10,029	9,343	(9.7)
Synthetic fiber	1,313	1,289	1,218	1.9

(5)

Research and Development

(6)

Health, Safety, Security and Environment

(7)

Capital Expenditures

(1)

Market Outlook

(2)

Operations

	Year ended 31 December
	2020	2019	Change (%)
	RMB million	RMB million
Turnover and other operating revenues	2,105,984	2,959,799	(28.8)
Turnover	2,049,456	2,899,682	(29.3)
Other operating revenues	56,528	60,117	(6.0)
Operating expenses	(2,092,791)	(2,873,425)	(27.2)
Purchased crude oil, products and operating supplies and expenses	(1,594,130)	(2,370,699)	(32.8)
Selling, general and administrative expenses	(55,315)	(55,438)	(0.2)
Depreciation, depletion and amortisation	(106,965)	(109,172)	(2.0)
Exploration expenses, including dry holes	(9,716)	(10,510)	(7.6)
Personnel expenses	(86,006)	(82,743)	3.9
Taxes other than income tax	(234,947)	(244,517)	(3.9)
Other operating expenses, net	(5,712)	(346)	1,550.9
Operating profit	13,193	86,374	(84.7)
Net finance costs	(9,506)	(10,048)	(5.4)
Investment income and share of profits less losses from associates and joint ventures	44,456	13,696	224.6
Profit before taxation	48,143	90,022	(46.5)
Income tax expense	(6,219)	(17,939)	(65.3)
Profit for the year	41,924	72,083	(41.8)
Attributable to:
Shareholders of the Company	33,096	57,493	(42.4)
Non-controlling interests	8,828	14,590	(39.5)

(1)

Turnover and other operating revenues

				Average realised price
	Sales volume (thousand tonnes)	(RMB/tonne, RMB/thousand cubic meters
	Year ended 31 December		Year ended 31 December
	2020	2019	Change (%)	2020	2019	Change (%)
Crude oil	7,422	6,034	23.0	2,029	3,000	(32.4)
Natural gas (million cubic meters)	26,280	27,073	(2.9)	1,352	1,562	(13.4)
Gasoline	86,193	92,233	(6.5)	6,298	7,387	(14.7)
Diesel	77,280	87,083	(11.3)	4,792	5,811	(17.5)
Kerosene	20,828	27,041	(23.0)	2,635	4,298	(38.7)
Basic chemical feedstock	36,683	41,022	(10.6)	3,635	4,599	(21.0)
Monomer and polymer for synthetic fibre	9,691	14,019	(30.9)	4,297	5,714	(24.8)
Synthetic resin	17,112	16,103	6.3	7,148	7,804	(8.4)
Synthetic fibre	1,402	1,370	2.3	6,381	8,438	(24.4)
Synthetic rubber	1,361	1,280	6.3	7,982	9,583	(16.7)
Chemical fertiliser	1,177	924	27.4	1,955	2,110	(7.3)

(2)

Operating expenses

(3)

Operating profit was RMB 13.2 billion, representing a decrease of 84.7% over the same period of 2019. That was mainly due to the decrease of processing volume, sales volume, and products margin affected by the COVID-19 outbreak, slump of crude oil prices, and drop of market demand.

(4)

Profit before taxation was RMB 48.1 billion, representing a decrease of 46.5% compared with 2019.

(5)

Income tax expense was RMB 6.2 billion, representing a decrease of 65.3% year on year. That was mainly due to decrease of profit before taxation, resulting in a decrease of RMB 10.5 billion in income tax.

(6)

Profit attributable to non-controlling shareholders was RMB 8.8 billion, representing a decrease of RMB 5.8 billion compared with 2019.

(7)

Profit attributable to shareholders of the Company was RMB 33.1 billion, representing a year-on-year decrease of 42.4%.

	Operating revenues Year ended 31 December	As a percentage of consolidated operating revenue before elimination of inter-segment sales Year ended 31 December	As a percentage of consolidated operating revenue after elimination of inter-segment sales Year ended 31 December
	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	(%)	(%)	(%)	(%)
Exploration and Production Segment
External sales*	110,242	121,397	3.2	2.5	5.2	4.1
Inter-segment sales	57,513	89,315	1.7	1.8
Operating revenues	167,755	210,712	4.9	4.3
Refining Segment
External sales*	118,698	147,138	3.4	3.0	5.6	5.0
Inter-segment sales	825,812	1,077,018	23.7	22.2
Operating revenues	944,510	1,224,156	27.1	25.2
Marketing and Distribution Segment
External sales*	1,097,352	1,426,804	31.6	29.3	51.9	48.2
Inter-segment sales	4,854	4,159	0.1	0.1
Operating revenues	1,102,206	1,430,963	31.7	29.4
Chemicals Segment
External sales*	331,336	438,103	9.5	9.0	15.4	14.8
Inter-segment sales	40,518	78,165	1.2	1.6
Operatingrevenues	371,854	516,268	10.7	10.6
Corporate and Others
External sales*	460,210	826,357	13.2	17.0	21.9	27.9
Inter-segment sales	430,073	654,337	12.4	13.5
Operating revenues	890,283	1,480,694	25.6	30.5
Operating revenue before elimination of inter-segment sales	3,476,608	4,862,793	100.0	100.0
Elimination of inter-segment sales	(1,370,624)	(1,902,994)
Turnover and other operating revenues	2,105,984	2,959,799			100.0	100.0

	Year ended 31 December
	2020	2019	Change
	RMB million	RMB million	(%)
Exploration and Production Segment
Operating revenues	167,755	210,712	(20.4)
Operating expenses	(184,231)	(201,428)	(8.5)
Operating (loss)/profit	(16,476)	9,284	-
Refining Segment
Operating revenues	944,510	1,224,156	(22.8)
Operating expenses	(950,065)	(1,193,524)	(20.4)
Operating (loss)/profit	(5,555)	30,632	-
Marketing and Distribution Segment
Operating revenues	1,102,206	1,430,963	(23.0)
Operating expenses	(1,081,378)	(1,401,856)	(22.9)
Operating profit	20,828	29,107	(28.4)
Chemicals Segment
Operating revenues	371,854	516,268	(28.0)
Operating expenses	(361,482)	(498,941)	(27.6)
Operating profit	10,372	17,327	(40.1)
Corporate and Others
Operating revenues	890,283	1,480,694	(39.9)
Operating expenses	(890,676)	(1,480,630)	(39.8)
Operating (loss)/profit	(393)	64	-
Elimination of inter-segment profit/(loss)	4,417	(40)	-

(1)

Exploration and Production Segment

•

Procurement cost decreased by RMB 12.0 billion year on year, as a result of decrease of LNG price;

•

Depreciation, depletion and amortisation decreased by RMB 4.5 billion year on year;

•

Cost of power fuel and purchased materials decreased by RMB 2.1 billion year on year;

•

Resource Tax and special oil income levy decreased by RMB 2.0 billion year on year;

•

Impairment losses on long-lived assets increased by RMB 7.9 billion year on year;

(2)

Refining Segment

	Sales Volume (thousand tonnes)	Average realised price (RMB/tonne)
	Year ended 31 December		Year ended 31 December
	2020	2019	Change (%)	2020	2019	Change (%)
Gasoline	56,259	60,750	(7.4)	5,813	7,057	(17.6)
Diesel	61,167	63,509	(3.7)	4,354	5,477	(20.5)
Kerosene	17,309	23,890	(27.6)	2,673	4,252	(37.2)
Chemical feedstock	39,872	39,720	0.4	2,596	3,531	(26.5)
Other refined petroleum products	65,353	61,890	5.6	3,011	3,237	(7.0)

(3)

Marketing and distribution segment

	Sales volume (thousand tonnes)	Average realised price (RMB/tonne)
	Year ended 31 December		Year ended 31 December
	2020	2019	Change (%)	2020	2019	Change (%)
Gasoline	86,216	92,261	(6.6)	6,370	7,387	(13.8)
Retail	61,446	66,440	(7.5)	6,940	7,968	(12.9)
Direct sales and distribution	24,770	25,820	(4.1)	4,955	5,892	(15.9)
Diesel	77,507	87,335	(11.3)	4,865	5,812	(16.3)
Retail	36,757	43,503	(15.5)	5,351	6,227	(14.1)
Direct sales and distribution	40,750	43,832	(7.0)	4,426	5,399	(18.0)
Kerosene	20,828	27,068	(23.1)	2,634	4,297	(38.7)
Fuel oil	23,331	21,772	7.2	2,536	3,072	(17.4)

(4)

Chemicals segment

	Sales Volume (thousand tonnes)	Average Realised Price (RMB/tonne)
	Year Ended 31 December		Year Ended 31 December
	2020	2019	Change (%)	2020	2019	Change(%)
Basic organic chemicals	47,109	52,007	(9.4)	3,564	4,534	(21.4)
Synthetic fibre monomer and polymer	9,743	14,089	(30.8)	4,302	5,722	(24.8)
Synthetic resin	17,124	16,131	6.2	7,150	7,804	(8.4)
Synthetic fibre	1,403	1,370	2.4	6,407	8,438	(24.1)
Synthetic rubber	1,364	1,284	6.3	7,986	9,595	(16.8)
Chemical fertiliser	1,181	925	27.8	1,950	2,109	(7.5)

(5)

Corporate and others

(1)

Assets, Liabilities and Equity

	As of 31 December 2020	As of 31 December 2019	change
Total assets	1,733,805	1,760,286	(26,481)
Current assets	455,395	447,310	8,085
Non-current assets	1,278,410	1,312,976	(34,566)
Total liabilities	850,947	882,982	(32,035)
Current liabilities	522,190	579,978	(57,788)
Non-current liabilities	328,757	303,004	25,753
Total equity attributable to shareholders of the Company	741,494	738,946	2,548
Share capital	121,071	121,071	-
Reserves	620,423	617,875	2,548
Non-controlling Interests	141,364	138,358	3,006
Total equity	882,858	877,304	5,554

(2)

Cash Flow

Major items of cash flows	Year ended 31 December
	2020	2019
Net cash generated from operating activities	167,518	153,619
Net cash used in investing activities	(102,203)	(121,051)
Net cash used in financing activities	(36,955)	(84,204)

(3)

Contingent Liabilities

(4)

Capital Expenditure

(5)

Research & Development and Environmental Expenditures

(6)

Measurement of fair values of derivatives and relevant system

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
Financial assets held for trading	3,319	1	114	0	0	Self-owned fund
Structured deposit	3,318	0	133	0	0	Self-owned fund
Stock	1	1	(19)	0	0	Self-owned fund
Derivative financial instruments	48	157	(1,252)	0	0	-
Cash flow hedges	(1,940)	7,545	3,051	9,207	0	-
Other equity instruments investment	1,521	1,525	0	(18)	0	-
Total	2,948	9,228	1,913	9,189	0	-

(1)

Under CASs, the operating income and operating profit or loss by reportable segments were as follows:

	Year ended 31 December
	2020	2019
	RMB million	RMB million
Operating income
Exploration and Production Segment	167,755	210,712
Refining Segment	944,510	1,224,156
Marketing and Distribution Segment	1,102,206	1,430,963
Chemicals Segment	371,854	516,268
Corporate and Others	890,283	1,480,694
Elimination of inter-segment sales	(1,370,624)	(1,902,994)
Consolidated operating income	2,105,984	2,959,799
Operating (loss)/profit
Exploration and Production Segment	(20,570)	6,289
Refining Segment	(6,556)	30,074
Marketing and Distribution Segment	19,634	29,781
Chemicals Segment	9,147	16,665
Corporate and Others	(2,048)	3,530
Elimination of inter-segment sales	4,417	(40)
Financial expenses, investment income, losses from changes in fair value, other income and asset disposal gains/(losses)	46,307	3,835
Consolidated operating profit	50,331	90,134
Net profit attributable to equity shareholders of the Company	32,924	57,619

(2)

Financial data prepared under CASs

	As of 31	As of 31
	December 2020	December 2019	Change
	RMB million	RMB million
Total assets	1,733,805	1,760,286	(26,841)
Non-current liabilities	327,739	301,934	25,805
Shareholder's equity	883,876	878,374	5,502

(3)

The results of the principal operations by segments

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	167,755	148,306	7.1	(20.4)	(12.0)	(8.4)
Refining	944,510	698,838	2.6	(22.8)	(25.9)	(1.7)
Marketing and Distribution	1,102,206	1,013,788	7.8	(23.0)	(24.0)	1.2
Chemicals	371,854	329,441	10.5	(28.0)	(30.2)	2.6
Corporate and Others	890,283	873,067	1.9	(39.9)	(40.4)	0.8
Elimination of inter-segment sales	(1,370,624)	(1,375,041)	N/A	N/A	N/A	N/A
Total	2,105,984	1,688,398	8.7	(28.8)	(31.9)	0.7

*:

Gross profit margin = (operation income - operation cost, tax and surcharges)/operation income.

(1)

Zhongke integrated refining and chemical project

(2)

Zhenhai refining & chemical expansion project (phase 1)

(3)

Zhenhai refining & chemical expansion project (phase 2)

(4)

Tianjin Nanggang ethylene and downstream high-end new material industry cluster project

(5)

Wuhan ethylene de-bottleneck project

(6)

Hainan Refining 1,000,000 tpa ethylene and refinery revamping and expansion project

(7)

Weirong shale gas project (phase 1 and phase 2)

(8)

Tianjin LNG project (phase 2)

	Sinopec Corp.	Sinopec Corp.	Sinopec Corp.
Bond name	2010 Corporate bond	2012 Corporate bond	2015 Corporate bond (first issue)
Abbreviation	10石化02	12石化02	15石化02
Code	122052	122150	136040
Issuance date	21 May 2010	1 June 2012	19 November 2015
Maturity date	21 May 2020	1 June 2022	19 November 2020
Amount issued (RMB billion)	9	7	4
Outstanding balance (RMB billion)	－	7	－
Interest rate (%)	4.05	4.90	3.70
Principal and interest repayment	Simple interest is calculated and paid on an annual basis without compounding interests. Interest is paid once a year. The principal will be paid at maturity with last installment of interest.
Payment of interests	Sinopec Corp. had paid in full the interest accrued of '12石化02' during the reporting period and '10石化02' and '15石化02' had been repaid and delisted from Shanghai Stock Exchange.
Investor Qualification Arrangement	15石化02 was publicly offered to qualified investors in accordance with Administration of the Issuance and Trading of Corporate Bonds.
Listing exchange	Shanghai Stock Exchange
Corporate bonds trustee	Name	China International Capital Corporation Limited
	Address	27th-28th Floor, China World Office 2, 1 Jianguomenwai Avenue, Chaoyang District, Beijing
	Contact Person	Huang Xu, Zhai Ying
	Telephone Number	(010) 6505 1166
Credit rating agency	Name	United Credit Ratings Co., Ltd.
	Address	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 as disclosed. All the proceeds have been completely used.
Credit rating	During the reporting period, United Credit Ratings Co., Ltd. tracked and provided credit rating for 10石化02, 12石化02 and 15石化02 and reaffirmed AAA credit rating in the continuing credit rating report. The long term credit rating of Sinopec Corp. remained AAA with its outlook being stable. Pursuant to relevant regulations, the latest credit rating results will be published through media designated by regulators within six months commencing from the date of the end of each fiscal year.
Credit addition mechanism, repayment scheme and other relative events for corporate bonds during the reporting period	During the reporting period, there is no arrangement to credit addition mechanism and change of the repayment for the above-mentioned corporate bonds. Sinopec Corp. strictly followed the provisions in the corporate bond prospectus to repay interests of the corporate bonds to bondholders.
	The guarantor of 10石化02 and 12石化02 is China Petrochemical Corporation. For more information of the guarantor, please refer to the annual report of corporate bonds which had been published on website of Shanghai Stock Exchange by China Petrochemical Corporation.
Convening of corporate bond holders' meeting	During the reporting period, the bondholders' meeting was not 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 fulfil obligations as described in the corporate bond prospectus and exercised its duty to protect the bondholders' legitimate rights and interests. The bond trustee has disclosed the Trustee Management Affairs Report of last year. The full disclosure is available on the website of Shanghai Stock Exchange (http://www.sse.com.cn).

Principal data	2020	2019	Change	Reasons for change
EBITDA (RMB million)	168,785	214,953	(46,168)	Due to the decrease of earnings before tax
Current ratio	0.87	0.77	0.10	Due to the decrease of current liability
Quick ratio	0.58	0.44	0.14	Due to the decrease of current liability
Liability-to-asset ratio (%)	49.02	50.10	(1.08)	Due to the decrease of total liability
			percentage points
EBITDA to total debt ratio	1.23	1.25	(0.02)	Due to the decrease of profit before tax
Interest coverage ratio	4.02	6.40	(2.38)	Due to the decrease of profit before tax
Cash flow interest coverage ratio	24.51	28.70	(4.19)	Due to the decrease of profit before tax
EBITDA-to-interest coverage ratio	10.64	12.88	(2.24)	Due to the decrease of profit before tax
Loan repayment rate (%)	100%	100%	-	-
Interest payment rate (%)	100%	100%	-	-

Background	Type ofUndertaking	Party	Contents	Term for performance	Whether bearsdeadline or not	Whether strictlyperformed or not
Undertakings related to Initial Public Offerings (IPOs)	IPOs	China Petrochemical Corporation	1 Compliance with the connected transaction agreements;	From 22 June 2001	No	Yes
			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	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) within ten years from the issuance date of this undertaking, 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

5 MATERIAL GUARANTEE CONTRACTS AND THEIR PERFORMANCE

U

Major external guarantees (excluding guarantees for controlled subsidiaries)
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*1
Sinopec Corp.	The listed company itself	Zhongtian Hechuang Energy Co., Ltd.	8,450	25 May 2016	25 May 2016 -31 December 2023 (the mature date is estimated)	Joint liability guarantee	No	No	None	No	Yes
Sinopec Corp.	The listed company itself	Zhong An United Coal Chemical Co., Ltd.	6,390	18 April 2018	18 April 2018-31 December 2031	Joint liability guarantee	No	No	None	No	No
Total amount of guarantees provided during the reporting period*2	None
Total amount of guarantees outstanding at the end of reporting period*2 (A)	14,840
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)	11,378
Total amount of guarantees for the Company (including those provided for controlled subsidiaries)
Total amount of guarantees (A+B)	26,218
The proportion of the total amount of guarantees to the Sinopec Corp.'s net assets	3.53%
Guarantees provided for shareholder, de facto controller and its related parties (C)	None
Amount of debt guarantees provided directly or indirectly to the companies with liabilities to assets ratio over 70% (D)	6,390
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)	6,390
Statement of guarantee undue that might be involved in any joint and several liabilities	None
Statement of guarantee status	None

*1:

As defined in the Rules Governing the Listing of Stocks on Shanghai Stock Exchange.

*2:

The amount of guarantees provided during the reporting period and the outstanding balance of guarantees amount at the end of the reporting period include the guarantees provided by the controlled subsidiaries to external parties. The amount of the guarantees provided by these subsidiaries is derived from multiplying the guarantees provided by Sinopec Corp.'s subsidiaries by the percentage of shareholding of Sinopec Corp. in such subsidiaries.

(1)

ENTRUSTED FINANCING

(2)

ENTRUSTED LOAN

Type	Source	Occurred amount	Undue amount	Overdue amount
Project construction	Self-owned fund	2.258	2.969	0
Current capital	Self-owned fund	(0.717)	0.384	0

(3)

OTHER FINANCING AND DERIVATIVE INVESTMENT

(1)

Targeted Poverty Alleviation Plan

(2)

2020 Targeted Poverty Alleviation Work Statistics

Index	Data
I. Overview
1. Funds	186.44
2. Value of goods and materials	0.95
3. Number of people lifted out of poverty	34,699
II. Input breakdowns
1. Poverty elimination through industrial development
1.1 Categories of poverty alleviation programs through	☑ Poverty alleviation through agriculture and forestry development
industrial 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	16
1.3 Input in poverty alleviation projects through industrial development	50.35
1.4 Number of people lifted out of poverty	32,135
2. Poverty elimination through provision of employment
2.1 Input in professional skill training	3.69
2.2 Participants of professional skill trainings (person/time)	21,699
2.3 Number of people employed	2,564
3. Poverty elimination through relocation
3.1 Number of relocated people provided with employment	0
3.2 Input in relocation	0
4. Poverty elimination through education
4.1 Input in students funding	0.95
4.2 Number of students who received funding assistance (person)	1,560
4.3 Input in education resources in poverty-stricken areas	52.94
5. Poverty alleviation through healthcare
5.1 Input in medical and health care resources in poverty-striken areas	14.46
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 Input in ecological protection	0.11
7. Guarantee basic living standard
7.1 Input in left-behind children, women and senior people	0.25
7.2 Number of left-behind children, women and senior people assisted (person)	210
7.3 Input in assisting the disabled	0.23
7.4 Number of the disabled helped (person)	76
8. Poverty alleviation through social projects
8.1 Input in coordinated poverty alleviation
8.2 Input in targeted poverty alleviation programs	140.54
8.3 Public welfare funds for poverty alleviation	0.40
9. Other projects
9.1 Number of projects	24
9.2 Total input	25.69
9.3 Number of people lifted out of poverty (person)	12,659
9.4 Other

(3)

Subsequent plan

(1)

The Company and China Petrochemical Corporation will mutually supply ancillary services for products, production and construction services (Mutual Supply Agreement);

(2)

China Petrochemical Corporation will provide trademarks, patents and computer software to the Company for use free of charge;

(3)

China Petrochemical Corporation will provide cultural and educational, hygienic and auxiliary services to the Company (Cultural, Educational, Hygiene and Auxiliary Services Agreement);

(4)

China Petrochemical Corporation will provide leasing services for lands and certain properties to the Company;

(5)

China Petrochemical Corporation will provide comprehensive insurance to the Company;

(6)

China Petrochemical Corporation will provide shareholders' loans to the Company; and

(7)

The Company will provide franchise licenses for service stations to China Petrochemical Corporation.

(a)

The government-prescribed price will apply;

(b)

where there is no government-prescribed price but where there is a government-guidance price, the government-guidance price will apply;

(c)

where there is neither a government-prescribed price nor a government-guidance price, the market price will apply; or

(d)

where none of the above is applicable, the price for the provision of the products or services is to be agreed between the relevant parties, which shall be the reasonable cost incurred in providing the same plus 6% or less of such cost.

(a)

The transactions have been conducted in the ordinary course of the Company's business;

(b)

The transactions have been entered into based on either of the following terms:

i

normal commercial terms; or

ii

terms not less favorable than those available from or to independent third parties, where there is no available comparison to determine whether such terms are on normal commercial terms; and

(c)

The transactions were conducted pursuant to the terms of relevant agreements, and the terms were fair and reasonable and in the interests of Sinopec Corp. and its shareholders as a whole.

		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*	10,818	(295)	10,523	18,388	(9,361)	9,027
Other related parties	Associates and joint ventures	1,738	9,590	11,328	392	5,695	6,087
Total		12,556	9,295	21,851	18,780	(3,666)	15,114
Reason for provision of funds between related parties	Loans and other accounts receivable and payable
Impacts of the provision of funds on the Company	No material negative impact

*:

Affiliated companies include subsidiaries, associates and joint ventures.

(1)

Compliance with the Corporate Governance Code

A

Board of Directors

A.1

Board of Directors

a.

The Board is the decision-making body of Sinopec Corp. and abides by good corporate governance practices and procedures. All decisions made by the Board are implemented by the Management of Sinopec Corp.

b.

The meeting of the Board of the Company is held at least once a quarter. The Board will usually communicate the time and proposals of the Board meeting 14 days before convening of the meeting. The relevant documents and materials for Board meetings are usually delivered to each Director 10 days in advance. In 2020, Sinopec Corp. held eleven Board meetings. For details about each Director's attendance at the Board meetings and the general meetings, please refer to the section 'Report of the Board of Directors' in this annual report.

c.

Each Director of the Board can submit proposals to be included in the agenda of Board meetings, and each Director is entitled to request other related information.

d.

The Board has reviewed and evaluated its performance in 2020 and is of the view that the Board made decisions in compliance with domestic and overseas regulatory authorities' requirements and the Company's internal rules; that the Board has considered the suggestions from the Party organisation, Board of Supervisors and management during its decision-making process; and that the Board safeguarded the legitimate rights and interests of Sinopec Corp. and its shareholders.

e.

The Secretary to the Board assists the Directors in handling the day-to-day work of the Board, continuously informs the Directors of the regulations, policies or other requirements of domestic or overseas regulatory authorities in relation to corporate governance and ensures that the Directors comply with domestic and overseas laws and regulations when performing their duties and responsibilities. Sinopec Corp. has purchased liability insurance for all Directors to minimise their risks that might incur from the performance of their duties.

A.2

Chairman and President

a.

Mr. Zhang Yuzhuo serves as Chairman of the Board and Mr. Ma Yongsheng serves as President of Sinopec Corp. The Chairman of the Board is elected by a majority vote of all Directors, and the President is nominated and appointed by the Board. The main duties and responsibilities of the Chairman and the President are clearly distinguished from each other, and the scope of their respective duties and responsibilities are set out in the Articles of Association.

b.

The Chairman of the Board places great emphasis on communication with the Independent Non-executive Directors. The Chairman independently held three meetings with the Independent Non-executive Directors in respect of development strategy, corporate governance and operational management, etc.

c.

The Chairman encourages open and active discussions. Directors fully and deeply participated in the discussions of significant decisions in the Board meetings.

A.3

Board composition

a.

The Board of Directors currently consists of nine members, four Executive Directors and five Non-executive Directors. Among the Non-executive Directors, there are three Independent Non-executive Directors, accounting for one third of the total number of Directors. For details, please refer to the section 'Directors, Supervisors, Senior Management and Employees' of this annual report.

b.

Sinopec Corp. has received from each of the Independent Non-executive Directors a letter of confirmation for 2020 regarding their compliance with relevant independence requirements set out in Rule 3.13 of the Hong Kong Listing Rules. Sinopec Corp. considers that each of the Independent Non-executive Directors is independent.

A.4

Appointment, re-election and dismissal

a.

The Directors serve three-year terms, and the consecutive term of office of an Independent Non-executive Director cannot exceed six years. During the reporting period, Mr. Zhang Yuzhuo and Mr. Liu Hongbin, nominated by the Board of Directors, and Mr. Zhang Shaofeng, nominated by China Petrochemical Corporation, were elected by the general meeting of shareholders as Directors of the Company. For details about the tenure of each Director, please refer to the section 'Directors, Supervisors, Senior Management and Employees'.

b.

All Directors of Sinopec Corp. have been elected at the general meeting of shareholders. The Board has no power to appoint temporary Directors.

c.

Sinopec Corp. engages professional consultants to prepare detailed materials for newly elected Directors, to notify them of the regulations of each listing place of Sinopec Corp. and to remind them of their rights, responsibilities and obligations as Directors.

A.5

Nomination Committee

a.

The Board of Directors established Nomination Committee, consisting of the Chairman of the Board, Mr. Zhang Yuzhuo, who serves as the Chairman, and Independent Non-executive Directors Mr. Tang Min and Mr. Ng, Kar Ling Johnny, who serve as members. The major responsibilities of Nomination Committee are to provide suggestions to the Board on Board's size and composition, as well as the selecting standards, procedures and candidates for Directors and senior management. Procedures to Propose a Person for Election as a Director of Sinopec Corp. are published on Sinopec Corp.'s website at http://www.sinopec.com.

b.

The Board establishes the Board Diversity Policy which stipulates that the members of the Board shall be nominated and appointed based on the skills and experience for the overall optimum operation of the Board, while taking into account the targets and requirements of the board diversity. When deciding the composition of the Board, Sinopec Corp. shall consider several factors in relation to the diversity of the Board, including but not limited to professional experience, skills, knowledge, length of service, regions, cultural and educational backgrounds, gender and age. The provisions of the Articles of Association concerning the term of office of directors help to ensure that the Board of Directors has a proper balance between continuous experience and new thinking, and enhance the level of diversity. Sinopec Corp. focuses on the implementation of the Board Diversity Policy. The Directors come from different industries at home and abroad with rich work experience. Professional backgrounds of Directors include petroleum and petrochemical corporate management, as well as economics, accounting and finance, which are conductive to scientific decision-making.

c.

The members of the Nomination Committee can engage professionals when performing their duties. Reasonable costs arising from such consultations are borne by Sinopec Corp. In the meantime, the Nomination Committee has also appointed consultant members and can require such member to provide advice. The working expenses of the Remuneration Committee are included in the budget of Sinopec Corp.

d.

During the reporting period, the Nomination Committee held five meetings (please refer to 'Meetings Held by the Board Committees' under the section of 'Report of the Board of Directors' in this annual report).

A.6

Responsibility of Directors

a.

All Non-executive Directors have the same duties and powers as the Executive Directors. In addition, the Independent Non-executive Directors are entitled to certain specific powers. The Articles of Association and the Rules of Procedure of Board Meetings clearly prescribe the duties and powers of Directors, Non-executive Directors including Independent Non-executive Directors, which are published on the Sinopec Corp.'s website at http://www.sinopec.com.

b.

Each of the Directors was able to devote sufficient time and efforts to handling the matters of Sinopec Corp.

c.

Each of the Directors confirmed that he has complied with the Model Code for Securities Transactions by Directors of Listed Issuers during the reporting period. In addition, Sinopec Corp. formulated the Rules Governing Shares Held by Company Directors, Supervisors and Senior Managers and Changes in Shares and the Model Code of Securities Transactions by Company Employees to regulate the purchase and sale of Sinopec Corp.'s securities by relevant personnel.

d.

Sinopec Corp. organised and arranged training sessions for Directors and paid the relevant fees as well as making relevant records. During the reporting period, the Directors actively participated in the trainings and attached great importance to continuing professional development to ensure that their contribution to the Board remains informed and relevant.

A.7

Provision and use of information

a.

The agenda and other reference documents for meetings of the Board and Board committees will be distributed prior to the meetings to give each Director sufficient time to review the materials so that Directors can make informed decisions.

b.

Each Director can obtain all related information in a comprehensive and timely manner. The Secretary of the Board is responsible for organising and preparing the materials for the Board meetings, including preparation of explanations for each proposal to ensure fully understanding by the Directors. The Management is responsible for providing the Directors with necessary information and materials. The Directors may require the Management, or require, via the Management, relevant departments to provide necessary information or explanations. The Directors may seek advices from professional consultants when necessary.

B

Remuneration and Appraisal Committee

a.

Remuneration and Appraisal Committee ('Remuneration Committee') consists of Independent Non-executive Director Mr. Tang Min, who serves as the Chairman, and Executive Director Mr. Ma Yongsheng and Independent Non-executive Director Mr. Ng, Kar Ling Johnny, who serve as the members of the Remuneration Committee. The Remuneration Committee is responsible for reviewing the implementation of the annual remuneration plans for Directors, Supervisors and other senior management as approved at the general meeting of the shareholders, and reporting to the Board.

b.

The Remuneration Committee always consults the Chairman of the Board and the President about the remuneration plans for other Executive Directors. After the Remuneration Committee's review, it is of the view that all the Executive Directors of Sinopec Corp. have fulfilled the duty clauses in their service contracts in 2020.

c.

The members of the Remuneration Committee can engage independent professionals when performing its duties. Reasonable costs arising from such consultations are borne by Sinopec Corp. In the meantime, the Remuneration Committee has also appointed consultants member and can require such member to provide advices. The working expenses of the Remuneration Committee are included in the budget of Sinopec Corp. According to the policies of Sinopec Corp., the senior management and relevant departments of Sinopec Corp. must actively cooperate with the Remuneration Committee.

d.

During the reporting period, the Remuneration Committee held one meeting (please refer to 'Meetings Held by the Board Committees' under the section of 'Report of the Board of Directors' in this annual report).

C

Accountability and Auditing

C.1

Financial reporting

a.

Directors are responsible for supervising the preparation of accounts for each fiscal period to ensure that the accounts truly and fairly reflect the condition of the business, the performance and the cash flow of the Company during the period. The Board approved the Financial Report for 2020 and warranted that the annual report contained no false representations, no material omissions or misleading statements and jointly and severally accepted full responsibility for the authenticity, accuracy and completeness of the content.

b.

Sinopec Corp. provides Directors with information about the financial, production and operating data of the Company every month to ensure that the Directors can learn about the latest developments of the Company in a timely manner.

c.

Sinopec Corp. has adopted an internal control mechanism to ensure that the Management and relevant departments have provided the Board and the Audit Committee with sufficient financial data and related explanations and materials.

d.

The external auditors of Sinopec Corp. made a statement on their reporting responsibilities in the auditor's report contained in the financial report.

C.2

Internal Control and Risk Management

a.

Sinopec Corp. has formulated and implemented its internal control and risk management system. The Board as a decision-making body is responsible for evaluating and reviewing the effectiveness of its internal control and risk management. The Board and the Audit Committee periodically (at least annually) receive reports of the Company regarding internal control and risk management information from the Management. All major internal control and risk management issues are reported to the Board and the Audit Committee. Sinopec Corp. has set up its internal control and risk management department and internal auditing departments, which are equipped with sufficient staff, and these departments periodically (at least twice per year) report to the Audit Committee. The internal control and risk management system of the Company are designed to manage rather than eliminate all the risks of the Company.

b.

In terms of internal control, Sinopec Corp. adopted the internal control framework prescribed in the internationally accepted Committee of Sponsoring Organisations of the Treadway Commission Report ('COSO'). Based upon the Articles of Association and the applicable management policies currently in effect, as well as in accordance with relevant domestic and overseas applicable regulations, Sinopec Corp. formulates and continuously improves the Internal Control Manual to achieve internal control of all factors of internal environment, risk assessment, controlling activities, information and communication, and internal supervision. At the same time, Sinopec Corp. has constantly supervised and evaluated its internal control, and conducted comprehensive and multi-level inspections including regular test, enterprise self-examination and auditing check, and included headquarters, branches and subsidiaries into the scope of internal control evaluation, with an internal control evaluation report being produced. The Board annually reviews the internal control evaluation report. For detailed information about the internal control during the reporting period, please refer to the 'Report on Internal Control Evaluation' prepared by Sinopec Corp.

c.

In terms of risk management, Sinopec Corp. adopts the enterprise risk management framework provided by COSO, and establishes its risk management policy and risk management organisation system. The Company annually conducts risk evaluation to identify major and important risks and perform risk management duties. It has designed major and important risks tackling strategies and measures combined with its internal control system and periodically monitors their implementation to ensure adequate care, monitor and tackling of major risks.

d.

Based upon the review and evaluation of internal control and risk management of the reporting period, the Board is of the view that the internal control and risk management of the Company are effective.

C.3

Audit Committee

a.

The Board has established an Audit Committee. The Audit Committee consists of Independent Non-executive Director Mr. Ng, Kar Ling Johnny, who serves as the Chairman, and Independent Non-executive Director Mr. Tang Min and Independent Non-executive Director Mr. Cai Hongbin, who serve as members. As verified, none of them has served as a partner or a former partner in our current auditing firm.

b.

During the reporting period, the Audit Committee held six meetings (please refer to the 'Meetings Held by the Board Committees' under the section of 'Report of the Board of Directors' in this annual report). The review opinions were issued at each meeting and submitted to the Board. During the reporting period, the Board and the Audit Committee had no disagreement.

c.

Audit Committee can engage independent professionals when performing its duties. Reasonable costs arising from such consultations are borne by Sinopec Corp. In the meantime, the Audit Committee has appointed consultants members and can request such member to provide advice. The working expenses of the Audit Committee are included in the budget of Sinopec Corp. In accordance with the policies of Sinopec Corp., the senior management and relevant departments of Sinopec Corp. shall actively cooperate with the Audit Committee.

d.

The Audit Committee has reviewed the adequacy and sufficiency of the resources for accounting and financial reporting and the qualifications and experience of the relevant employees as well as the sufficiency of the training courses and the budget thereof. Audit Committee is of the view that the Management has fulfilled the duties to establish an effective internal control system. The Company established a whistle-blowing policy in its internal control system, providing several channels as online reporting, letter reporting, receipt of appeals and a complaint mailbox, etc. to employees to report behavior that violates the internal control system of the Company. The Audit Committee has reviewed and approved such policy.

D

Delegation of power by the Board

a.

The Board and the Management have clear duties and responsibilities in written rules. The Articles of Association and the Rules of Procedure for the General Meetings of Shareholders and the Rules of Procedure of the Board Meetings clearly set forth the scope of duties, powers and delegation of power of the Board and Management, which are published on the website of Sinopec Corp. at http://www.sinopec.com.

b.

In addition to the Audit Committee, the Remuneration Committee and Nomination Committee, the Board had established the Strategy Committee and the Social Responsibility Management Committee. The Strategy Committee is responsible for overseeing long-term development strategies and significant investment decisions of the Company. The seventh Session of Strategy Committee consists of four Directors, including Chairman of the Board Mr. Zhang Yuzhuo, who serves as Chairman, as well as Executive Directors Mr. Ma Yongsheng, Mr. Ling Yiqun and Independent Non-executive Director Mr. Cai Hongbin, who serve as members. The Social Responsibility Management is responsible for preparing policies, governance, strategies and plans for social responsibility management of the Company. The Social Responsibility Management Committee consists of three Directors, including Chairman of the Board Mr. Zhang Yuzhuo, who serves as Chairman, Independent Non-executive Directors Mr. Tang Min and Mr. Cai Hongbin, who serve as members.

c.

Each Board Committee is required to report its decisions and recommendations to the Board and has formulated its terms of references. The Terms of Reference of the Audit Committee, The Terms of Reference of the Remuneration Committee and The Terms of Reference of the Nomination Committee are published on the website of Sinopec Corp. at http://www.sinopec.com.

E

Investor Relations

a.

Sinopec Corp. pays high attention to investor relations. The Management attends road shows every year to answer questions on subjects of concern to investors, such as introducing the development strategies and the production and business performance of the Company. Sinopec Corp. establishes a department responsible for communicating with investors. In compliance with regulatory provisions, Sinopec Corp. enhances communication with investors by holding meetings with institutional investors, setting up an investor hotline and communicating through internet platform.

b.

During the reporting period, separate resolution was proposed for each substantially separate issue at the general meeting of shareholders. All resolutions were voted by poll to ensure the interests of all shareholders. Notices of the general meeting were dispatched to shareholders 45 days (excluding the date of the general meeting) in advance.

c.

The Chairman of the Board hosted the annual general meeting for the year 2019 and the Second Extraordinary General Meeting for the year 2020. Some members of the Board of Directors and Board of Supervisors and senior management attended the meeting and communicated deeply with the investors.

d.

According to relevant rules of Sinopec Corp., the Secretary to the Board is responsible for establishing an effective communication channel between Sinopec Corp. and its shareholders, for setting up special departments to communicate with the shareholders and for passing the opinions and proposals of the shareholders to the Board and Management in a timely manner. Contact details of Sinopec Corp. can be found on the 'Investor Center' section on Sinopec Corp's website.

F

Company Secretary

a.

The Hong Kong Stock Exchange recognised the Secretary to the Board as having the relevant qualifications as company Secretary. Nominated by the Chairman of the Board and appointed by the Board, the Secretary to the Board is a senior management officer of Sinopec Corp. and responsible for the Company and the Board. The Secretary gives opinions on corporate governance to the Board and arranges orientation training and professional development for the Directors.

b.

During the reporting period, the Secretary to the Board actively participated in career development training with more than 15 training hours.

G

Shareholders' Rights

a.

Shareholders who individually or collectively hold 10% of the total voting shares of Sinopec Corp. may request the Board in writing to convene the general meeting of shareholders. If the Board fails to approve the request to convene the meeting according to the Rules of Procedure for General Meetings of Shareholders, the shareholders may convene and hold the meeting at their discretion according to applicable laws, and reasonable expenses incurred will be borne by Sinopec Corp. These aforementioned provisions are subject to the following conditions: the proposals at the general meeting of shareholders must fall within the responsibilities of the general meeting of shareholders, with specific proposals and resolutions and in compliance with relevant laws, administrative regulations and the Articles of Association.

b.

When Sinopec Corp. holds the general meeting of shareholders, shareholders who individually or collectively hold 3% of the total voting shares of Sinopec Corp. may propose a supplemental proposal 10 days before the date of the general meeting.

c.

The eligibility for attending the general meeting, the rights of shareholders, the resolutions at the meeting and the voting procedures are clearly stated in the notice of the general meeting of shareholders of Sinopec Corp. dispatched to the shareholders.

d.

Sinopec Corp. establishes special organisation in charge of communication with shareholders and publishes relevant contact details to facilitate shareholders to make enquiries pursuant to Articles of Association.

(2)

Auditors

(3)

Other information about Sinopec Corp.'s corporate governance

(1)

The 9th meeting of the seventh session of the Board was held by written resolution on 13 January 2020, whereby the proposals in relation to the following matters were approved: (i) the appointment of Chief Financial Officer, (ii) the representative on securities matters.

(2)

The 10th meeting of the seventh session of the Board was held by written resolution on 7 February 2020, whereby the proposals in relation to the following matters were approved: (i) nomination of candidates for Directors; (ii) Notice of 2020 First Extraordinary General Meeting.

(3)

The 11th meeting of the seventh session of the Board was held by written resolution on 25 March 2020, whereby the proposals in relation to the following matters were approved: (i) the election of the Chairman of the Board, the member adjustment of Board committees; (ii) the appointment of Senior Vice President.

(4)

The 12th meeting of the seventh session of the Board was held by on-site meeting and via video conference on 27 March 2020, whereby the proposals in relation to the following matters were approved: (i) the Work Report of the Board for the year 2019; (ii) the completion of key targets of 2019 and work arrangements of 2020; (iii) financial results and business performance of the Company for the year 2019; (iv) provision for impairment for the year 2019; (v) the connected transactions for the year 2019; (vi) profit distribution plan for the year 2019; (vii) audit costs for the year 2019; (viii) re-appointment of external auditors of Sinopec Corp. for the year of 2020 and to authorise the Board to determine their remunerations; (ix) to authorize the Board to determine the interim profit distribution plan of Sinopec Corp. for the year 2020; (x) to authorize the Board to determine the proposed plan for issuance of debt financing instrument(s); (xi) the report of Risk Assessment for Capital Deposits at Finance Company and Century Bright Company; (xii) Internal control assessment report of Sinopec Corp. for the year 2019; (xiii) Financial Statements of Sinopec Corp. for the year 2019; (xiv) Annual Report of the Company for the year 2019; (xv) Form 20F of the Company for the year 2019; (xvi) 2019 Communication on Progress on Sustainable Development Report of Sinopec Corp.; (xvii) the proposal to the annual general meeting to grant to the Board a general mandate to issue new domestic shares and/or overseas-listed foreign shares of Sinopec Corp.

(5)

The 13th meeting of the seventh session of the Board was held by written resolution on 14 April 2020, whereby the proposal on external guarantees in Project AMUR was approved.

(6)

The 14th meeting of the seventh session of the Board was held by written resolution on 29 April 2020, whereby the proposals in relation to the following matters were approved: (i) the first quarterly results of the Company for the three months ended 31 March 2020; (ii) Reorganisation and integration of assets of ZhongKe Refining and Zhanjiang Dongxing.

(7)

The 15th meeting of the seventh session of the Board was held by written resolution on 23 July 2020, whereby the proposals in relation to the following matters were approved: (i) Disposal of Oil and Gas Pipelines and Related Assets; (ii) the appointment of Vice President of Sinopec Corp.

(8)

The 16th meeting of the seventh session of the Board was held by on-site meeting and via video conference on 28 August 2020, whereby the proposals in relation to the following matters were approved: (i) the report on the fulfillment of the key targets for the first half of the year 2020 and the work arrangements for the second half of the year 2020; (ii) the 2020 interim special dividend distribution plan; (iii) the report of Risk Assessment for Capital Deposits at Finance Company and Century Bright Company; (iv) the adjustment of the 2020 investment plan; (v) the financial statements for the first half of the year 2020 reviewed by PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers; (vi) interim report for the six months ended 30 June 2020; (vii) the member adjustment of Board committees.

(9)

The 17th meeting of the seventh session of the Board was held by written resolution on 11 September 2020, whereby the proposals in relation to the following matters were approved: (i) the appointment of Senior Vice President of Sinopec Corp.; (ii) the nomination of candidate for Director.

(10)

The 18th meeting of the seventh session of the Board was held by written resolution on 28 October 2020, whereby the proposals in relation to the following matters were approved: (i) the third quarterly report for three months ended 30 September 2020; (ii) reorganisation of assets in respect of Baling Petrochemical.

(11)

The 19th meeting of the seventh session of the Board was held by written resolution on 4 December 2020, whereby the proposal in relation to investment and construction of Tianjin Nangang 1.2 million tonnes/year ethylene and downstream high-end new materials project was approved.

(1)

Directors of the seventh session of Board of Directors ' attendance to the board meetings and general meetings during this reporting period

Director titles	Name	Board meeting	General meeting
		No. of meetings held	Actual attendance	Meetings attended by communication	Attended by proxy	Absent	No.of meetings held	Actual attendance
Chairman	Zhang Yuzhuo	9	2	7	0	0	2	2
Director	Ma Yongsheng	11	2	9	0	0	3	3
Director	Yu Baocai	11	1	9	1	0	3	2
Director	Liu Hongbin	5	1	4	0	0	1	1
Director	Ling Yiqun	11	1	9	1	0	3	1
Director	Zhang Shaofeng	2	0	2	0	0	0	0
Independent Director	Tang Min	11	2	9	0	0	3	0
Independent Director	Cai Hongbin	11	2	9	0	0	3	0
Independent Director	Ng, Kar Ling Johnny	11	2	9	0	0	3	0

(2)

Former Directors of the seventh Session of Board of Directors' attendance to the board meetings and the general meetings during this reporting period

Director titles	Name	Board meetings	General meeting
		No. of meetings held	Actual attendance	Meetings attended by communication	Attended by proxy	Absent	No. of meetings held	Actual attendance
Former Chairman	Dai Houliang	1	0	1	0	0	0	0
Former Director	Li Yunpeng	2	0	2	0	0	0	0
Former Director	Li Yong	9	2	7	0	0	2	0
Former Independent Director	Fan Gang	7	1	6	0	0	2	0

(3)

The Independent Director's attendance to the General Meetings.

(1)

The eighth meeting of the seventh session of the Audit Committee was held by on-site meeting and via video conference on 25 March 2020, whereby the proposals in relation to the following matters were approved: (i) Annual Report of the Company for the year 2019 and Form 20F of the Company for the year 2019; (ii) Financial results and business performance of the Company for the year 2019 (including a. provision for impairment for the year 2019; b. The continuing connected transactions for the year 2019; c. Profit appropriation plan for the year 2019; d. Audit costs for the year 2019; e. the report of Risk Assessment for Capital Deposits at Finance Company and Century Bright Company); (iii) Internal control assessment report of Sinopec Corp. for the year 2019; (iv) Report on audit work in 2019 and audit work arrangement in 2020. Reports on the auditing work of the financial statements for the year 2019 prepared by the domestic and overseas auditors were also reviewed at the meeting.

(2)

The ninth meeting of the seventh session of the Audit Committee was held by written resolutions on 28 April 2020, whereby the proposals in relation to the following matters were approved: (i) the first quarterly report of the Company for the three months ended 31 March 2020; (ii)Reorganisation and Integration of assets of ZhongKe Refining and Zhanjiang Dongxing.

(3)	The tenth meeting of the seventh session of the Audit Committee was held by written resolutions on 22 July 2020, whereby the Proposal in relation to Sale of Oil and Gas Pipelines and Related Assets was approved.

(4)

The eleventh meeting of the seventh session of the Audit Committee was held by on-site meeting and via video conference on 26 August 2020, whereby the proposals in relation to the following matters were approved: (i) the interim financial statements for the first half of the year 2020; (ii) interim report for the six months ended 30 June 2020; (iii) the report on the business performance, financial statements and related matters for the first half of the year 2020 (including: a. the 2020 interim special dividend appropriation plan, b. the report of Risk Assessment for Capital Deposits at Finance Company and Century Bright Company); (iv) Report on the main audit work in the first half of 2020 and the overall arrangement of audit work in the second half of 2020.

(5)

The twelfth meeting of the seventh session of the Audit Committee was held by written resolutions on 28 October 2020, whereby the proposals in relation to the following matters were approved: (i) the third quarterly report of the Company for the three months ended 30 September 2020; (ii) reorganisation of assets in respect of Baling Petrochemical.

(6)	The thirteenth meeting of the seventh session of the Audit Committee was held by on-site meeting and via video conference on 2 November 2020, whereby the proposal in relation to recruitment of accounting firms in 2021 was approved.

(7)	The fourth meeting of the seventh session of the Strategy Committee was held by written resolution on 25 March 2020, whereby the proposal in relation to the plan of investments of 2020 of Sinopec Corp. was approved.

(8)	The fifth meeting of the seventh session of the Strategy Committee was held by written resolution on 14 April 2020, whereby the proposal in relation to Project AMUR was approved.

(9)	The sixth meeting of the seventh session of the Strategy Committee was held by written resolution on 26 August 2020, whereby the proposal in relation to the adjustment of the 2020 investment plan was approved.

(10)	The second meeting of the seventh session of the Remuneration and Appraisal Committee was held by written resolution on 25 March 2020 whereby the proposal in relation to the implementation of the rules of the remuneration of Directors, Supervisors and other senior management for 2019 was approved.

(11)	The second meeting of the seventh session of the Social Responsibility Management Committee was held by written resolution on 25 March 2020, whereby the proposal in relation to 2019 Communication on Progress on Sustainable Development Report of Sinopec Corp. was approved.

(12)	The third meeting of the seventh session of the Nomination Committee was held by written resolution on 10 January 2020, whereby the proposal in relation to the appointment of Chief Financial Officer was approved.

(13)	The fourth meeting of the seventh session of the Nomination Committee was held by written resolution on 6 February 2020, whereby the proposal in relation to the nomination of candidates for Director was approved.

(14)	The fifth meeting of the seventh session of the Nomination Committee was held by written resolution on 25 March 2020, whereby the proposals in relation to the nomination of candidates for Director and the appointment of Senior Vice President were approved.

(15)	The sixth meeting of the seventh session of the Nomination Committee was held by written resolution on 22 July 2020, whereby the proposal in relation to the appointment of Vice President of Sinopec Corp. was approved.

(16)	The seventh meeting of the seventh session of the Nomination Committee was held by written resolution on 10 September 2020, whereby the proposal in relation to the appointment of Senior Vice President was approved.

	2020	2019	2018
Cash dividends (RMB/Share, tax inclusive)	0.20	0.31	0.42
Total amount of cash dividends (RMB billion, tax inclusive)	24.214	37.533	50.850
Net profits attributed to the shareholders of the listed company shown in the consolidated statement for the dividend year (RMB billion)	32.924	57.619	63.179
Ratio of the dividends to the net profit attributed to the shareholders of the listed company in the consolidated statement (%)	73.5	65.1	80.5

(1)

Directors

					Remuneration
					paid by	Whether
					in 2020	paid by	Equity interests in Sinopec Corp.
			Position in		(RMB 1,000,	the holding	(as at 31 December)
Name	Gender	Age	Sinopec Corp.	Tenure	before tax)	Company	2020	2019
Zhang Yuzhuo	Male	59	Chairman	2020.03-2021.05	-	Yes	0	0
Ma Yongsheng	Male	59	Board Director, President	2016.02-2021.05	1,013.1	No	0	0
Yu Baocai	Male	56	Board Director,	2018.10-2021.05	-	Yes	0	0
			Senior Vice President
Liu Hongbin	Male	58	Board Director,	2020.05-2021.05	-	Yes	0	0
			Senior Vice President
Ling Yiqun	Male	58	Board Director,	2018.05-2021.05	-	Yes	13,000	13,000
			Senior Vice President
Zhang Shaofeng	Male	49	Board Director	2020.09-2021.05	-	Yes	0	0
Tang Min	Male	67	Independent Director	2015.05-2021.05	350.0	No	0	0
Cai Hongbin	Male	53	Independent Director	2018.05-2021.05	350.0	No	0	0
Ng, Kar Ling Johnny	Male	60	Independent Director	2018.05-2021.05	350.0	No	0	0

					Remuneration
					paid by	Whether
					in 2020	paid by	Equity interests in Sinopec Corp.
			Position in		(RMB 1,000,	the holding	(as at 31 December)
Name	Gender	Age	Sinopec Corp.	Tenure	before tax)	Company	2020	2019
Dai Houliang	Male	57	Former Chairman	2009.05-2020.01	-	Yes	0	0
Li Yunpeng	Male	62	Former Director	2017.06-2020.03	-	Yes	0	0
Li Yong	Male	57	Former Director	2018.05-2020.09	-	Yes	0	0
Fan Gang	Male	67	Former Independent Director	2015.05-2020.08	-	NO	0	0

(2)

Supervisors

						Whether
					Remuneration	paid by the
					paid by	shareholders
					Sinopec Corp.	of the	Equity interests
					in 2020	Company or	in Sinopec Corp.
			Position in		(RMB 1,000,	their related	(as of 31 December)
Name	Gender	Age	Sinopec Corp.	Tenure	before tax)	entities	2020	2019
Zhao Dong	Male	50	Chairman of the	2017.06-2021.05	-	Yes	0	0
			Board of Supervisors
Jiang Zhenying	Male	56	Supervisor	2018.05-2021.05	1,159.4	No	0	0
Li Defang	Male	59	Employee Representative Supervisor	2020.05-2021.05	-	Yes	40,000	40,000
Lv Dapeng	Male	59	Employee representative Supervisor	2021.01-2021.05	-	Yes	0	0
Chen Yaohuan	Male	57	Employee Representative Supervisor	2021.01-2021.05	-	Yes	0	0

						Whether
						paid by the
					Remuneration	shareholders
					paid by	of the	Equity interests
					in 2020	Company or	in Sinopec Corp.
			Position in		(RMB 1,000,	their related	(as of 31 December)
Name	Gender	Age	Sinopec Corp.	Tenure	before tax)	entities	2020	2019
Yu Xizhi	Male	58	Employee Representative Supervisor	2017.06-2020.05	761.9	No	0	0
Zhou Hengyou	Male	57	Employee Representative Supervisor	2018.05-2020.05	760.0	No	0	0
Yang Changjiang	Male	60	Supervisor	2018.05-2020.09	-	Yes	0	0
Zhang Baolong	Male	61	Supervisor	2018.05-2020.09	-	Yes	0	0
Zou Huiping	Male	60	Supervisor	2006.05-2021.01	885.1	No	0	0
Sun Huanquan	Male	56	Employee Representative Supervisor	2020.05-2021.01	466.3	No	0	0
Yu Renming	Male	57	Employee Representative Supervisor	2010.12-2021.01	-	Yes	0	0

(3)

Other Members of Senior Management

					Whether
				Remuneration	paid by the
				paid by	shareholders
				Sinopec Corp.	of the
				in 2020	Company or	Equity interests in Sinopec Corp.
			Position in	(RMB 1,000,	their related	(as of 31 December)
Name	Gender	Age	Sinopec Corp.	before tax)	entities	2020	2019
Chen Ge	Male	58	Senior Vice President	1,510.6	No	0	0
Yu Xizhi	Male	58	Vice President	317.3	No	0	0
Shou Donghua	Female	51	Chief Financial Officer	805.4	No	0	0
Zhao Rifeng	Male	58	Vice President	1,622.1	No	0	0
Huang Wensheng	Male	54	Vice President, Board Secretary	1,252.4	No	0	0

					Whether
				Remuneration	paid by the
				paid by	shareholders
				Sinopec Corp.	of the
				in 2020	Company or	Equity interests in Sinopec Corp.
			Position in	(RMB 1,000,	their related	(as of 31 December)
Name	Gender	Age	Sinopec Corp.	before tax)	entities	2020	2019
Lei Dianwu	Male	58	Former Senior Vice President	1,173.3	No	0	0

Name of Company	Registered Capital RMB million	Percentage of shares held by Sinopec Corp. (%)	Total Assets RMB million	Net Assets RMB million	Net Profit/ (Net Loss) RMB million	Principal Activities
Sinopec International Petroleum Exploration and Production Limited	8,250	100	31,571	12,826	1,160	Investment in exploration, production and sale of petroleum and natural gas
Sinopec Great Wall Energy & Chemical Company Limited	22,761	100	30,490	10,453	(3,777)	Coal chemical industry investment management, production and sale of coal chemical products
Sinopec Yangzi Petrochemical Company Limited	15,651	100	32,966	20,843	26	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Yizheng Chemical Fibre Limited Liability Company	4,000	100	8,483	5,742	5	Production and sale of polyester chips and polyester fibres
Sinopec Lubricant Company Limited	3,374	100	9,011	4,450	617	Production and sale of refined petroleum products, lubricant base oil, and petrochemical materials
Sinopec Qingdao Petrochemical Company Limited	1,595	100	3,138	567	(120)	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Chemical Sales Company Limited	1,000	100	19,065	3,947	1,084	Marketing and distribution of petrochemical products
China International United Petroleum and Chemical Company Limited	5,000	100	147,791	37,346	6,671	Trading of crude oil and petrochemical products
Sinopec Overseas Investment Holding Limited	1,662 million USD	100	17,462	8,234	(4,338)	Overseas investment holding
Sinopec Catalyst Company Limited	1,500	100	10,921	5,665	664	Production and sale of catalyst products
China Petrochemical International Company Limited	1,400	100	19,803	3,618	(617)	Trading of petrochemical products
Sinopec Beihai Refining and Chemical Limited Liability Company petrochemical products	5,294	98.98	15,335	11,474	637	Import and processing of crude oil, production, storage and sale of petroleum products and petrochemical products
Sinopec Qingdao Refining and Chemical Company Limited	5,000	85	17,565	10,122	(221)	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Hainan Refining and Chemical Company Limited	9,606	75	30,651	19,540	1,183	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Marketing Co., Limited	28,403	70.42	495,923	234,691	22,415	Marketing and distribution of refined petroleum products
Sinopec Shanghai SECCO Petrochemical Company Limited	7,801	67.60	22,608	18,272	2,132	Production and sale of petrochemical products
Sinopec-SK (Wuhan) Petrochemical Company Limited	7,193	59	25,826	10,940	(920)	Production, sale, research and development of petroleum, petrochemical, ethylene and downstream by-products
Sinopec Kantons Holdings Limited	248 million HKD	60.33	13,479	12,385	2,047	Oil jetty and nature gas pipeline
Sinopec Shanghai Gaoqiao Petroleum and Chemical Limited	10,000	55	34,277	15,176	902	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Shanghai Petrochemical Company Limited	10,824	50.44	44,749	29,355	639	Manufacturing of synthetic fibres, resin and plastics, intermediate petrochemical products and petroleum products
Fujian Petrochemical Company Limited	10,492	50	14,150	12,999	243	Manufacturing of plastics, intermediate petrochemical products and  petroleum products
Zhongke (Guangdong) Refining and Chemical Company Limited	6,397	90.3	45,315	19,682	423	Crude oil processing and petroleum products manufacturing
Sinopec Baling Petrochemical Co. Ltd.	3,000	55	11,368	4,740	257	Crude oil processing and petroleum products manufacturing

Note	1: All above subsidiaries except Fujian Petrochemical Company Limited are audited by PricewaterhouseCoopers Zhong Tian LLP or PricewaterhouseCoopers in 2020. KPMG Huazhen LLP served the exception.

‧	the consolidated and company balance sheets as at 31 December 2020;

‧	the consolidated and company income statements for the year then ended;

‧	the consolidated and company cash flow statements for the year then ended;

‧	the consolidated and company statements of changes in shareholders' equity for the year then ended; and

‧	notes to the financial statements.

Key Audit Matter	How our audit addressed the Key Audit Matter
Recoverability of the carrying amount of fixed assets relating to oil and gas producing activities Refer to Note 13 'Fixed assets' and Note 56 'Principal accounting estimates and judgements' to the financial statements. Low crude oil prices gave rise to possible indication that the carrying amount of fixed assets relating to oil and gas producing activities as at 31 December 2020 might be impaired. The Group has adopted value in use as the respective recoverable amounts of fixed assets relating to oil and gas producing activities, which involved key estimations or assumptions including: -Future crude oil prices; -Future production profiles; -Future cost profiles; and -Discount rates. Because of the significance of the carrying amount of fixed assets relating to oil and gas producing activities as at 31 December 2020, together with the use of significant estimations or assumptions in determining their respective value in use, we had placed our audit emphasis on this matter.	In auditing the respective value in use calculations of fixed assets relating to oil and gas producing activities, we performed the following key procedures on the relevant discounted cash flow projections prepared by management: ‧ Obtained an understanding of the management's internal control and assessment process of impairment of fixed assets relating to oil and gas producing activities and assessed the inherent risk of material misstatement by considering the degree of estimation uncertainty and level of other inherent risk factors such as complexity, subjectivity, changes and susceptibility to management bias or fraud. ‧ Evaluated and tested the key controls in respect of the preparation of the discounted cash flow projections of fixed assets relating to oil and gas producing activities. ‧ Assessed the methodology adopted in the discounted cash flow projections, tested mathematical accuracy of the projections, and the completeness, accuracy, and relevance of underlying data used in the projections. ‧ Compared estimates of future crude oil prices adopted by the Group against a range of published crude oil price forecasts. ‧ Compared the future production profiles against the oil and gas reserve estimation report approved by the management. Evaluated the competence, capability and objectivity of the management's experts engaged in estimating the oil and gas reserves. Assessed key estimations or assumptions used in the reserve estimation, by reference to historical data, management plans and/or relevant external data. ‧ Compared the future cost profiles against historical costs and relevant budgets of the Group. ‧ Tested selected other key data inputs, such as natural gas prices and production profiles in the projections by reference to historical data and/or relevant budgets of the Group. ‧ Used professionals with specialized skill and knowledge to assist in the evaluation of the appropriateness of discount rates adopted by the management. ‧ Evaluated the sensitivity analyses prepared by the Group, and assessed the potential impacts of a range of possible outcomes. Based on our work, we found the key assumptions and input data adopted were supported by the evidence we obtained.

‧

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

‧	Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

‧	Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

‧

Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on Sinopec Corp.'s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in these financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause Sinopec Corp. to cease to continue as a going concern.

‧	Evaluate the overall presentation (including the disclosures), structure and content of the financial statements, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

‧

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Sinopec Corp. to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

PricewaterhouseCoopers Zhong Tian LLP	Signing CPA	Zhao Jianrong
Shanghai, the People's Republic of China		(Engagement Partner)
	Signing CPA	Hu Yang
26 March 2021

	Notes	At 31 December 2020	At 31 December 2019
		RMB million	RMB million
Assets
Current assets
Cash at bank and on hand	5	184,412	128,052
Financial assets held for trading		1	3,319
Derivative financial assets	6	12,528	837
Accounts receivable	7	35,587	54,375
Receivables financing	8	8,735	8,661
Prepayments	9	4,862	5,063
Other receivables	10	33,602	24,190
Inventories	11	151,895	194,142
Other current assets		23,773	28,671
Total current assets		455,395	447,310
Non-current assets
Long-term equity investments	12	188,342	152,204
Other equity instrument investments		1,525	1,521
Fixed assets	13	589,285	625,706
Construction in progress	14	124,765	173,872
Right-of-use assets	15	189,583	198,051
Intangible assets	16	114,066	109,039
Goodwill	17	8,620	8,697
Long-term deferred expenses	18	9,535	8,935
Deferred tax assets	19	25,054	17,616
Other non-current assets	20	27,635	17,335
Total non-current assets		1,278,410	1,312,976
Total assets		1,733,805	1,760,286
Liabilities and shareholders' equity
Current liabilities
Short-term loans	22	20,756	31,196
Derivative financial liabilities	6	4,826	2,729
Bills payable	23	10,394	11,834
Accounts payable	24	151,262	188,189
Contract liabilities	25	126,160	126,833
Employee benefits payable	26	7,081	4,807
Taxes payable	27	76,843	69,524
Other payables	28	84,600	75,376
Non-current liabilities due within one year	29	22,493	69,490
Other current liabilities	30	17,775	-
Total current liabilities		522,190	579,978
Non-current liabilities
Long-term loans	31	45,459	39,677
Debentures payable	32	38,356	19,157
Lease liabilities	33	172,306	177,674
Provisions	34	45,552	43,163
Deferred tax liabilities	19	8,124	6,809
Other non-current liabilities	35	17,942	15,454
Total non-current liabilities		327,739	301,934
Total liabilities		849,929	881,912
Shareholders' equity
Share capital	36	121,071	121,071
Capital reserve	37	122,558	122,864
Other comprehensive income	38	1,038	(321)
Specific reserve		1,941	1,741
Surplus reserves	39	209,280	207,423
Retained earnings		286,575	287,187
Total equity attributable to shareholders of the Company		742,463	739,965
Minority interests		141,413	138,409
Total shareholders' equity		883,876	878,374
Total liabilities and shareholders' equity		1,733,805	1,760,286

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Notes	At 31 December	At 31 December
		2020	2019
		RMB million	RMB million
Assets
Current assets
Cash at bank and on hand		99,188	54,072
Derivative financial assets		7,776	940
Accounts receivable	7	21,763	21,544
Receivables financing		707	207
Prepayments	9	2,626	2,665
Other receivables	10	37,938	78,872
Inventories		39,034	49,116
Other current assets		14,048	25,149
Total current assets		223,080	232,565
Non-current assets
Long-term equity investments	12	343,356	304,687
Other equity instrument investments		428	395
Fixed assets	13	283,695	291,547
Construction in progress	14	59,880	60,493
Right-of-use assets	15	108,737	112,832
Intangible assets		8,779	8,809
Long-term deferred expenses		2,499	2,630
Deferred tax assets		12,661	7,315
Other non-current assets		26,828	2,490
Total non-current assets		846,863	791,198
Total assets		1,069,943	1,023,763
Liabilities and shareholders' equity
Current liabilities
Short-term loans		20,669	19,919
Derivative financial liabilities		362	157
Bills payable		6,061	4,766
Accounts payable		65,779	75,352
Contract liabilities		5,840	5,112
Employee benefits payable		1,673	1,214
Taxes payable		43,500	43,025
Other payables		188,568	118,064
Non-current liabilities due within one year		12,026	59,596
Other current liabilities		439	-
Total current liabilities		344,917	327,205
Non-current liabilities
Long-term loans		30,413	12,680
Debentures payable		26,977	7,000
Lease liabilities		105,691	107,783
Provisions		36,089	34,514
Other non-current liabilities		3,581	4,471
Total non-current liabilities		202,751	166,448
Total liabilities		547,668	493,653
Shareholders' equity
Share capital		121,071	121,071
Capital reserve		68,976	68,841
Other comprehensive income		5,910	1,181
Specific reserve		1,189	949
Surplus reserves		209,280	207,423
Retained earnings		115,849	130,645
Total shareholders' equity		522,275	530,110
Total liabilities and shareholders' equity		1,069,943	1,023,763

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Notes	2020	2019
		RMB million	RMB million
Operating income	40	2,105,984	2,959,799
Less:Operating costs	40	1,688,398	2,479,356
Taxes and surcharges	41	234,947	244,517
Selling and distribution expenses		64,438	63,586
General and administrative expenses		66,291	63,038
Research and development expenses	44	10,086	9,450
Financial expenses	42	9,506	10,048
Exploration expenses, including dry holes	45	9,716	10,510
Add:Other income	46	7,513	5,995
Investment income	47	47,486	12,628
Losses from changes in fair value	48	(1,253)	(3,511)
Credit impairment losses		(2,066)	(1,264)
Impairment losses	49	(26,018)	(1,779)
Asset disposal losses		2,067	(1,229)
Operating profit		50,331	90,134
Add: Non-operating income	50	2,370	2,601
Less: Non-operating expenses	51	4,732	2,624
Profit before taxation		47,969	90,111
Less: Income tax expense	52	6,219	17,939
Net profit		41,750	72,172
Including: net profit of acquiree before business combination under common control		119	50
Classification by going concern:
Continuous operating net profit		41,750	72,172
Termination of net profit		-	-
Classification by ownership:
Equity shareholders of the Company		32,924	57,619
Minority interests		8,826	14,553
Basic earnings per share	64	0.272	0.476
Diluted earnings per share	64	0.272	0.476
Other comprehensive income	38
Items that may not be reclassified subsequently to profit or loss
Changes in fair value of other equity instrument investments		(22)	(31)
Items that may be reclassified subsequently to profit or loss
Other comprehensive income that can be converted into profit or loss under the equity method		(2,441)	(810)
Fair value hedges		162	-
Cash flow hedges		7,073	4,941
Foreign currency translation differences		(4,457)	1,480
Total other comprehensive income		315	5,580
Total comprehensive income		42,065	77,752
Attributable to:
Equity shareholders of the Company		34,318	63,034
Minority interests		7,747	14,718

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Notes	2020	2019
		RMB million	RMB million
Operating income	40	770,321	1,021,272
Less:Operating costs	40	584,315	799,566
Taxes and surcharges		148,350	161,820
Selling and distribution expenses		3,256	3,420
General and administrative expenses		29,868	28,302
Research and development expenses		9,098	8,597
Financial expenses		8,749	7,628
Exploration expenses, including dry holes		8,297	9,417
Add:Other income		4,922	3,497
Investment income	47	43,356	28,062
Gains/(losses) from changes in fair value		350	(278)
Credit impairment losses		71	132
Impairment losses		(16,374)	(534)
Asset disposal gains		261	6,407
Operating profit		10,974	39,808
Add: Non-operating income		900	665
Less: Non-operating expenses		1,319	1,135
Profit before taxation		10,555	39,338
Less: Income tax (credit)/expense		(8,017)	1,886
Net profit		18,572	37,452
Classification by going concern:
Continuous operating net profit		18,572	37,452
Termination of net profit		-	-
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Other comprehensive income that can be converted into profit or loss under the equity method		(182)	201
Cash flow hedges		4,948	1,384
Total other comprehensive income		4,766	1,585
Total comprehensive income		23,338	39,037

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Notes	2020	2019
		RMB million	RMB million
Cash flows from operating activities:
Cash received from sale of goods and rendering of services		2,297,159	3,171,968
Refund of taxes and levies		2,985	2,053
Other cash received relating to operating activities		212,828	98,464
Sub-total of cash inflows		2,512,972	3,272,485
Cash paid for goods and services		(1,754,016)	(2,591,739)
Cash paid to and for employees		(83,772)	(84,283)
Payments of taxes and levies		(282,162)	(318,091)
Other cash paid relating to operating activities		(225,504)	(124,753)
Sub-total of cash outflows		(2,345,454)	(3,118,866)
Net cash flow from operating activities	54(a)	167,518	153,619
Cash flows from investing activities:
Cash received from disposal of investments		11,651	35,996
Cash received from returns on investments		11,510	10,272
Net cash received from disposal of fixed assets, intangible assets and other long-term assets		2,656	709
Net cash received from disposal of subsidiaries and other business entities	54(d)	49,869	-
Other cash received relating to investing activities		58,669	97,804
Sub-total of cash inflows		134,355	144,781
Cash paid for acquisition of fixed assets, intangible assets and other long-term assets		(131,189)	(141,554)
Cash paid for acquisition of investments		(12,740)	(16,334)
Net cash paid for the acquisition of subsidiaries and other business entities		(340)	(1,031)
Other cash paid relating to investing activities		(92,289)	(106,913)
Sub-total of cash outflows		(236,558)	(265,832)
Net cash flow from investing activities		(102,203)	(121,051)
Cash flows from financing activities:
Cash received from capital contributions		4,219	3,919
Including: Cash received from minority shareholders' capital contributions to subsidiaries		4,219	3,919
Cash received from borrowings		558,680	602,467
Other cash received relating to financing activities		514	320
Sub-total of cash inflows		563,413	606,706
Cash repayments of borrowings		(540,015)	(614,108)
Cash paid for dividends, profits distribution or interest		(43,144)	(59,615)
Including: Subsidiaries' cash payments for distribution of dividends or profits to minority shareholders		(4,157)	(7,357)
Other cash paid relating to financing activities	54(e)	(17,209)	(17,187)
Sub-total of cash outflows		(600,368)	(690,910)
Net cash flow from financing activities		(36,955)	(84,204)
Effects of changes in foreign exchange rate		(1,239)	147
Net increase/(decrease) in cash and cash equivalents	54(b)	27,121	(51,489)

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Notes	2020	2019
		RMB million	RMB million
Cash flows from operating activities:
Cash received from sale of goods and rendering of services		862,093	1,162,870
Refund of taxes and levies		2,796	1,769
Other cash received relating to operating activities		9,407	6,239
Sub-total of cash inflows		874,296	1,170,878
Cash paid for goods and services		(606,295)	(842,996)
Cash paid to and for employees		(44,139)	(45,524)
Payments of taxes and levies		(164,635)	(209,863)
Other cash paid relating to operating activities		(19,239)	(18,719)
Sub-total of cash outflows		(834,308)	(1,117,102)
Net cash flow from operating activities		39,988	53,776
Cash flows from investing activities:
Cash received from disposal of investments		12,157	23,584
Cash received from returns on investments		18,805	31,385
Net cash received from disposal of fixed assets, intangible assets and other long-term assets		6,579	690
Other cash received relating to investing activities		78,751	42,037
Sub-total of cash inflows		116,292	97,696
Cash paid for acquisition of fixed assets, intangible assets and other long-term assets		(59,216)	(64,100)
Cash paid for acquisition of investments		(41,066)	(16,884)
Other cash paid relating to investing activities		(66,408)	(53,138)
Sub-total of cash outflows		(166,690)	(134,122)
Net cash flow from investing activities		(50,398)	(36,426)
Cash flows from financing activities:
Cash received from borrowings		195,770	109,579
Other cash received relating to financing activities		70,516	91,865
Sub-total of cash inflows		266,286	201,444
Cash repayments of borrowings		(199,727)	(106,920)
Cash paid for dividends or interest		(36,973)	(50,230)
Other cash paid relating to financing activities		(7,074)	(104,780)
Sub-total of cash outflows		(243,774)	(261,930)
Net cash flow from financing activities		22,512	(60,486)
Effects of changes in foreign exchange rate		(5)	-
Net increase/(decrease) in cash and cash equivalents		12,097	(43,136)

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Share capital	Capital reserve	Other comprehensive income	Specific reserve	Surplus reserves	Retained earnings	Total shareholders' equity attributable to equity shareholders of the Company	Minority interests	Total shareholders' equity
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Balance at 31 December 2018	121,071	119,192	(6,774)	1,706	203,678	279,482	718,355	139,304	857,659
Adjustment for business combination of entities under common control (Note 58)	-	735	-	-	-	58	793	670	1,463
Balance at 1 January 2019	121,071	119,927	(6,774)	1,706	203,678	279,540	719,148	139,974	859,122
Change for the year
1.Net profit	-	-	-	-	-	57,619	57,619	14,553	72,172
2. Other comprehensive income (Note 38)	-	-	5,415	-	-	-	5,415	165	5,580
Total comprehensive income	-	-	5,415	-	-	57,619	63,034	14,718	77,752
Amounts transferred to initial carrying amount of hedged items	-	-	1,038	-	-	-	1,038	55	1,093
Transactions with owners, recorded directly in shareholders' equity:
3. Appropriations of profits:
- Appropriations for surplus reserves	-	-	-	-	3,745	(3,745)	-	-	-
- Distributions to shareholders (Note 53)	-	-	-	-	-	(46,008)	(46,008)	-	(46,008)
4. Contributions to subsidiaries from minority interests	-	-	-	-	-	-	-	5,495	5,495
5. Transaction with minority interests	-	2,933	-	-	-	-	2,933	(2,933)	-
6. Distributions to minority interests	-	-	-	-	-	-	-	(18,989)	(18,989)
Total transactions with owners, recorded directly in shareholders' equity	-	2,933	-	-	3,745	(49,753)	(43,075)	(16,427)	(59,502)
7. Net increase in specific reserve for the year	-	-	-	35	-	-	35	34	69
8.Others	-	4	-	-	-	(219)	(215)	55	(160)
Balance at 31 December 2019	121,071	122,864	(321)	1,741	207,423	287,187	739,965	138,409	878,374
Balance at 1 January 2020	121,071	122,864	(321)	1,741	207,423	287,187	739,965	138,409	878,374
Change for the year
1. Net profit	-	-	-	-	-	32,924	32,924	8,826	41,750
2. Other comprehensive income (Note 38)	-	-	1,406	-	-	(12)	1,394	(1,079)	315
Total comprehensive income	-	-	1,406	-	-	32,912	34,318	7,747	42,065
Amounts transferred to initial carrying amount of hedged items	-	-	(47)	-	-	-	(47)	48	1
Transactions with owners, recorded directly in shareholders' equity:
3.Appropriations of profits:
- Appropriations for surplus reserves	-	-	-	-	1,857	(1,857)	-	-	-
- Distributions to shareholders (Note 53)	-	-	-	-	-	(31,479)	(31,479)	-	(31,479)
4.Contributions to subsidiaries from minority interests	-	-	-	-	-	-	-	3,325	3,325
5.Transaction with minority interests	-	(138)	-	-	-	-	(138)	13	(125)
6.Distributions to minority interests	-	-	-	-	-	-	-	(6,726)	(6,726)
7. Adjustment for business combination of entities under common control	-	(972)	-	-	-	-	(972)	972	-
Total transactions with owners, recorded directly in shareholders' equity	-	(1,110)	-	-	1,857	(33,336)	(32,589)	(2,416)	(35,005)
8. Net increase in specific reserve for the year	-	-	-	200	-	-	200	37	237
9. Others	-	804	-	-	-	(188)	616	(2,412)	(1,796)
Balance at 31 December 2020	121,071	122,558	1,038	1,941	209,280	286,575	742,463	141,413	883,876

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Share capital	Capital reserve	Other comprehensive income	Specific reserve	Surplus reserves	Retained earnings	Total shareholders' equity
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Balance at 1 January 2019	121,071	68,795	(485)	989	203,678	143,148	537,196
Change for the year
1.Net profit	-	-	-	-	-	37,452	37,452
2.Other comprehensive income	-	-	1,585	-	-	-	1,585
Total comprehensive income	-	-	1,585	-	-	37,452	39,037
Amounts transferred to initial carrying amount of hedged items	-	-	81	-	-	-	81
Transactions with owners, recorded directly in shareholders' equity:
3.Appropriations of profits:
－Appropriations for surplus reserves	-	-	-	-	3,745	(3,745)	-
－Distributions to shareholders (Note 53)	-	-	-	-	-	(46,008)	(46,008)
Total transactions with owners, recorded directly in shareholders' equity	-	-	-	-	3,745	(49,753)	(46,008)
4.Net increase in specific reserve for the year	-	-	-	(40)	-	-	(40)
5.Others	-	46	-	-	-	(202)	(156)
Balance at 31 December 2019	121,071	68,841	1,181	949	207,423	130,645	530,110
Balance at 1 January 2020	121,071	68,841	1,181	949	207,423	130,645	530,110
Change for the year
1.Net profit	-	-	-	-	-	18,572	18,572
2.Other comprehensive income	-	-	4,766	-	-	-	4,766
Total comprehensive income	-	-	4,766	-	-	18,572	23,338
Amounts transferred to initial carrying amount of hedged items	-	-	(37)	-	-	-	(37)
Transactions with owners, recorded directly in shareholders' equity:
3. Appropriations of profits:
－Appropriations for surplus reserves	-	-	-	-	1,857	(1,857)	-
－Distributions to shareholders (Note 53)	-	-	-	-	-	(31,479)	(31,479)
Total transactions with owners, recorded directly in shareholders' equity	-	-	-	-	1,857	(33,336)	(31,479)
4. Net increase in specific reserve for the year	-	-	-	240	-	-	240
5. Others	-	135	-	-	-	(32)	103
Balance at 31 December 2020	121,071	68,976	5,910	1,189	209,280	115,849	522,275

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

(1)

Statement of compliance of China Accounting Standards for Business Enterprises ('CASs')

(2)

Accounting period

(3)

Measurement basis

-

Financial assets held for trading (see Note 3(11))

-

Other equity instrument investments (see Note 3(11))

-

Derivative financial instruments (see Note 3(11))

-

Receivables financing (see Note 3(11))

(4)

Functional currency and presentation currency

(1)

Accounting treatment of business combination involving entities under common control and not under common control

(a)

Business combination involving entities under common control

(b)

Business combination involving entities not under common control

(c)

Method for preparation of consolidated financial statements

(1)

Accounting treatment of business combination involving entities under common control and not under common control (Continued)

(c)

Method for preparation of consolidated financial statements (Continued)

(2)

Transactions in foreign currencies and translation of financial statements in foreign currencies

(3)

Cash and cash equivalents

(4)

Inventories

(4)

Inventories (Continued)

(5)

Long-term equity investments

(a)

Investment in subsidiaries

(b)

Investment in joint ventures and associates

(5)

Long-term equity investments (Continued)

(b)

Investment in joint ventures and associates (Continued)

(c)

The impairment assessment method and provision accrual on investment

(6)

Leases

(a)

As Lessee

(b)

As Lessor

(7)

Fixed assets and construction in progress

	Estimated	Estimated rate
	useful life	of residual value
Plants and buildings	12-50 years	3%
Equipment, machinery and others	4-30 years	3%

(8)

Oil and gas properties

(9)

Intangible assets

(10)

Goodwill

(11)

Financial Instruments

(a)

Financial assets

(i)

Classification and measurement

-

Measured at amortised cost:

-

Measured at fair value through other comprehensive income:

(ii)

Impairment

(11)

Financial Instruments (Continued)

(a)

Financial assets (Continued)

(ii)

Impairment (Continued)

(iii)

Derecognition

(b)

Financial liabilities

(c)

Determination of fair value

(d)

Derivative financial instruments and hedge accounting

(11)

Financial Instruments (Continued)

(d)

Derivative financial instruments and hedge accounting (Continued)

(1)

There is an economic relationship between the hedged item and the hedging instrument, which share a risk and that gives rise to opposite changes in fair value that tend to offset each other.

(2)

The effect of credit risk does not dominate the value changes that result from that economic relationship.

(3)

The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the entity actually hedges and the quantity of the hedging instrument that the entity actually uses to hedge that quantity of hedged item. However, that designation shall not reflect an imbalance between the weightings of the hedged item and the hedging instrument.

-

Cash flow hedges

-

The cumulative gain or loss on the hedging instrument from inception of the hedge;

-

The cumulative change in present value of the expected future cash flows on the hedged item from inception of the hedge.

(12)

Impairment of other non-financial long-term assets

(12)

Impairment of other non-financial long-term assets (Continued)

(13)

Long-term deferred expenses

(14)

Employee benefits

(a)

Short term compensation

(b)

Post-employment benefits

(c)

Termination benefits

(15)

Income tax

(15)

Income tax (Continued)

-

the taxable entity has a legally enforceable right to offset current tax assets and current tax liabilities; and

-

they relate to income taxes levied by the same tax authority on either:

-

the same taxable entity; or

-

different taxable entities which either to intend to settle the current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

(16)

Provisions

(17)

Revenue recognition

(18)

Government grants

(19)

Borrowing costs

(20)

Repairs and maintenance expenses

(21)

Environmental expenditures

(22)

Research and development costs

(23)

Dividends

(24)

Related parties

(a)

the holding company of the Company;

(b)

the subsidiaries of the Company;

(c)

the parties that are subject to common control with the Company;

(d)

investors that have joint control or exercise significant influence over the Group;

(e)

enterprises or individuals if a party has control, joint control over both the enterprises or individuals and the Group;

(f)

joint ventures of the Group, including subsidiaries of the joint ventures;

(g)

associates of the Group, including subsidiaries of the associates;

(h)

principle individual investors of the Group and close family members of such individuals;

(i)

key management personnel of the Group, and close family members of such individuals;

(j)

key management personnel of the Company's holding company;

(k)

close family members of key management personnel of the Company's holding company; and

(l)

an entity which is under control, joint control of principle individual investor, key management personnel or close family members of such individuals.

(m)

the Company and the Joint ventures or associates of other members of the Company's holding company (including the holding company and the subsidiaries); and

(n)

Joint ventures of the Company and other joint ventures or associates of the Company.

(25)

Segment reporting

•

engage in business activities from which it may earn revenues and incur expenses;

•

whose operating results are regularly reviewed by the Group's management to make decisions about resource to be allocated to the segment and assess its performance; and

•

for which financial information regarding financial position, results of operations and cash flows are available.

(26)

Changes in significant accounting policies

	Effective from
	13 January 2015
Products	(RMB/Ton)
Gasoline	2,109.76
Diesel	1,411.20
Naphtha	2,105.20
Solvent oil	1,948.64
Lubricant oil	1,711.52
Fuel oil	1,218.00
Jet fuel oil	1,495.20

	At 31 December 2020	At 31 December 2019
	Original currency million	Exchange rates	RMB million	Original currency million	Exchange rates	RMB million
Cash on hand
Renminbi			8			14
Cash at bank
Renminbi			120,542			78,924
US Dollar	1,054	6.5249	6,875	1,889	6.9762	13,174
Hong Kong Dollar	1,377	0.8416	1,159	17	0.8958	15
EUR	1	8.0250	8	1	7.8155	8
Others			2,403			85
			130,995			92,220
Deposits at related parities
Renminbi			23,737			17,809
US Dollar	4,443	6.5249	28,993	2,560	6.9762	17,862
EUR	49	8.0250	394	14	7.8155	106
Others			293			55
			53,417			35,832
Total			184,412			128,052

	The Group	The Company
	At 31 December	At 31 December	At 31 December	At 31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Accounts receivable	39,447	56,223	21,871	21,675
Less: Allowance for doubtful accounts	3,860	1,848	108	131
Total	35,587	54,375	21,763	21,544

	The Group
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total accounts receivable	Allowance	Percentage of allowance to accounts receivable balance	Amount	Percentage to total accounts receivable	Allowance	Percentage of allowance to accounts receivable balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	34,626	87.8	117	0.3	55,231	98.2	1,204	2.2
Between one and two years	4,062	10.3	3,131	77.1	260	0.5	70	26.9
Between two and three years	149	0.4	85	57.0	129	0.2	65	50.4
Over three years	610	1.5	527	86.4	603	1.1	509	84.4
Total	39,447	100.0	3,860		56,223	100.0	1,848

	The Company
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total accounts receivable	Allowance	Percentage of allowance to accounts receivable balance	Amount	Percentage to total accounts receivable	Allowance	Percentage of allowance to accounts receivable balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	21,647	99.0	1	-	21,368	98.6	-	-
Between one and two years	76	0.3	7	9.2	105	0.5	17	16.2
Between two and three years	49	0.2	13	26.5	51	0.2	15	29.4
Over three years	99	0.5	87	87.9	151	0.7	99	65.6
Total	21,871	100.0	108		21,675	100.0	131

	At 31 December	At 31 December
	2020	2019
Total amount (RMB million)	15,628	9,878
Percentage to the total balance of accounts receivable	39.6%	17.6%
Allowance for doubtful accounts	2,057	732

	The Group	The Company
	At 31 December	At 31 December	At 31 December	At 31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Prepayments	4,939	5,143	2,637	2,671
Less: Allowance for doubtful accounts	77	80	11	6
Total	4,862	5,063	2,626	2,665

	The Group
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total prepayments	Allowance	Percentage of allowance to prepayments balance	Amount	Percentage to total prepayments	Allowance	Percentage of allowance to prepayments balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	4,440	89.9	-	-	4,402	85.6	-	-
Between one and two years	267	5.4	20	7.5	589	11.5	26	4.4
Between two and three years	142	2.9	8	5.6	33	0.6	5	15.2
Over three years	90	1.8	49	54.4	119	2.3	49	41.2
Total	4,939	100.0	77		5,143	100.0	80

	The Company
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total prepayments	Allowance	Percentage of allowance to prepayments balance	Amount	Percentage to total prepayments	Allowance	Percentage of allowance to prepayments balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	2,337	88.6	-	-	2,424	90.7	-	-
Between one and two years	159	6.0	7	4.4	123	4.6	1	0.8
Between two and three years	39	1.5	-	-	39	1.5	2	5.1
Over three years	102	3.9	4	3.9	85	3.2	3	3.5
Total	2,637	100.0	11		2,671	100.0	6

	At 31 December	At 31 December
	2020	2019
Total amount (RMB million)	1,131	1,940
Percentage to the total balance of prepayments	22.9%	37.7%

	The Group	The Company
	At 31 December	At 31 December	At 31 December	At 31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Other receivables	35,133	25,646	38,835	79,827
Less: Allowance for doubtful accounts	1,531	1,456	897	955
Total	33,602	24,190	37,938	78,872

	The Group
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total other receivables	Allowance	Percentage of allowance to other receivables balance	Amount	Percentage to total other receivables	Allowance	Percentage of allowance to other receivables balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	23,888	68.1	51	0.2	22,196	86.5	87	0.4
Between one and two years	8,513	24.2	196	2.3	1,554	6.1	52	3.3
Between two and three years	1,169	3.3	84	7.2	198	0.8	71	35.9
Over three years	1,563	4.4	1,200	76.8	1,698	6.6	1,246	73.4
Total	35,133	100.0	1,531		25,646	100.0	1,456

	The Company
	At 31 December 2020	At 31 December 2019
	Amount	Percentage to total other receivables	Allowance	Percentage of allowance to other receivables balance	Amount	Percentage to total other receivables	Allowance	Percentage of allowance to other receivables balance
	RMB million	%	RMB million	%	RMB million	%	RMB million	%
Within one year	21,378	55.0	-	-	44,402	55.6	-	-
Between one and two years	2,123	5.5	1	-	13,826	17.3	3	-
Between two and three years	1,618	4.2	5	0.3	6,933	8.7	1	-
Over three years	13,716	35.3	891	6.5	14,666	18.4	951	6.5
Total	38,835	100.0	897		79,827	100.0	955

	At 31 December	At 31 December
	2020	2019
Total amount (RMB million)	22,581	10,561
Ageing	Within one year, one to two years, two to three years and over three years	Within one year
Percentage to the total balance of other receivables	64.3%	41.2%
Allowance for doubtful accounts	-	-

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Raw materials	60,155	89,908
Work in progress	13,053	12,687
Finished goods	78,415	91,554
Spare parts and consumables	3,372	2,578
	154,995	196,727
Less: Provision for diminution in value of inventories	3,100	2,585
Total	151,895	194,142

	Investments in joint ventures	Investments in associates	Provision for impairment losses	Total
	RMB million	RMB million	RMB million	RMB million
Balance at 1 January 2020	57,433	96,481	(1,710)	152,204
Additions for the year (i)	2,297	72,237	-	74,534
Share of profits less losses under the equity method	635	6,077	-	6,712
Change of other comprehensive loss under the equity method	(1,004)	(1,437)	-	(2,441)
Other equity movements under the equity method	(58)	28	-	(30)
Dividends declared	(2,798)	(9,135)	-	(11,933)
Disposals for the year (i)	(486)	(26,490)	-	(26,976)
Foreign currency translation differences	(955)	(913)	111	(1,757)
Other movements	(46)	24	-	(22)
Movement of provision for impairment	-	-	(1,949)	(1,949)
Balance at 31 December 2020	55,018	136,872	(3,548)	188,342

	Investments in subsidiaries	Investments in joint ventures	Investments in associates	Provision for impairment losses	Total
	RMB million	RMB million	RMB million	RMB million	RMB million
Balance at 1 January 2020	274,220	15,530	22,816	(7,879)	304,687
Additions for the year (i)	29,008	362	48,060	-	77,430
Share of profits less losses under the equity method	-	1,346	2,291	-	3,637
Change of other comprehensive loss under the equity method	-	-	(182)	-	(182)
Other equity movements under the equity method	-	-	35	-	35
Dividends declared	-	(1,217)	(325)	-	(1,542)
Disposals for the year (i)	(36,289)	(1,259)	(3,155)	-	(40,703)
Movement of provision for impairment	-	-	-	(6)	(6)
Balance at 31 December 2020	266,939	14,762	69,540	(7,885)	343,356

(a)

Principal joint ventures and associates

Name of investees	Principal place of business	Register location	Legal representative	Principal activities	Registered Capital RMB million	Percentage of equity/voting right directly or indirectly held by the Company
1. Joint ventures
Fujian Refining & Petrochemical Company Limited ('FREP')	PRC	PRC	Gu Yuefeng	Manufacturing refining oil products	14,758	50.00%
BASF-YPC Company Limited ('BASF-YPC')	PRC	PRC	Hong Jianqiao	Manufacturing and distribution of petrochemical products	12,704	40.00%
Taihu Limited ('Taihu')	Russia	Cyprus	NA	Crude oil and natural gas extraction	25,000 USD	49.00%
Yanbu Aramco Sinopec Refining Company Ltd. ('YASREF')	Saudi Arabia	Saudi Arabia	NA	Petroleum refining and processing	1,560 million USD	37.50%
Sinopec SABIC Tianjin Petrochemical Company Limited ('Sinopec SABIC Tianjin')	PRC	PRC	AHMED AL-SHAIKH	Manufacturing and distribution of petrochemical products	10,520	50.00%
2. Associates
China Oil & Gas Pipeline Network Corporation ('PipeChina') (i)	PRC	PRC	Zhang Wei	Operation of oil and natural gas pipelines and auxiliary facilities	500,000	14.00%
Sinopec Finance Company Limited ('Sinopec Finance')	PRC	PRC	Zhao Dong	Provision of non-banking financial services	18,000	49.00%
PAO SIBUR Holding ('SIBUR') (ii)	Russia	Russia	NA	Processing natural gas and manufacturing petrochemical products	21,784 million RUB	10.00%
Zhongtian Synergetic Energy Company Limited ('Zhongtian Synergetic Energy')	PRC	PRC	Peng Yi	Mining coal and manufacturing of coal-chemical products	17,516	38.75%
Caspian Investments Resources Ltd. ('CIR')	The Republic of Kazakhstan	British Virgin Islands	NA	Crude oil and natural gas extraction	10,002 USD	50.00%

(b)

Major financial information of principal joint ventures

	FREP	BASF-YPC	Taihu	YASREF	Sinopec SABIC Tianjin
	At	At	At	At	At	At	At	At	At	At
	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets
Cash and cash equivalents	7,448	5,603	1,838	1,154	1,280	4,485	1,408	733	5,259	3,242
Other current assets	7,492	11,977	4,777	4,937	1,223	2,336	7,516	11,311	2,665	4,501
Total current assets	14,940	17,580	6,615	6,091	2,503	6,821	8,924	12,044	7,924	7,743
Non-current assets	15,237	17,267	9,993	10,498	12,531	10,453	45,413	50,548	18,258	14,878
Current liabilities
Current financial liabilities	(1,203)	(1,280)	(456)	(237)	(38)	(57)	(9,520)	(7,445)	(998)	(500)
Other current liabilities	(5,147)	(7,090)	(2,190)	(1,808)	(1,043)	(1,815)	(8,644)	(12,504)	(3,052)	(2,896)
Total current liabilities	(6,350)	(8,370)	(2,646)	(2,045)	(1,081)	(1,872)	(18,164)	(19,949)	(4,050)	(3,396)
Non-current liabilities
Non-current financial liabilities	(8,761)	(11,185)	-	-	(85)	(125)	(29,650)	(29,445)	(6,773)	(4,592)
Other non-current liabilities	(235)	(290)	(42)	(35)	(2,017)	(1,984)	(2,008)	(1,963)	(378)	(368)
Total non-current liabilities	(8,996)	(11,475)	(42)	(35)	(2,102)	(2,109)	(31,658)	(31,408)	(7,151)	(4,960)
Net assets	14,831	15,002	13,920	14,509	11,851	13,293	4,515	11,235	14,981	14,265
Net assets attributable to shareholders of the company	14,831	15,002	13,920	14,509	11,439	12,829	4,515	11,235	14,981	14,265
Net assets attributable to minority interests	-	-	-	-	412	464	-	-	-	-
Share of net assets from joint ventures	7,416	7,501	5,568	5,804	5,605	6,286	-	4,213	7,491	7,133
Carrying Amounts	7,416	7,501	5,568	5,804	5,605	6,286	-	4,213	7,491	7,133

	FREP	BASF-YPC	Taihu	YASREF	Sinopec SABIC Tianjin
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	38,691	57,047	15,701	19,590	9,528	15,222	37,337	75,940	14,881	20,541
Interest income	118	124	27	32	291	94	17	58	183	171
Interest expense	(535)	(597)	(16)	(26)	(20)	(265)	(1,136)	(1,470)	(131)	(134)
Profit/(loss) before taxation	520	964	1,518	2,314	2,304	3,320	(7,193)	(1,292)	954	2,178
Tax expense	(87)	(197)	(379)	(579)	(378)	(708)	1,057	(8)	(236)	(533)
Profit/(loss) for the year	433	767	1,139	1,735	1,926	2,612	(6,136)	(1,300)	718	1,645
Other comprehensive loss	-	-	-	-	(3,368)	(1,105)	(584)	(261)	-	-
Total comprehensive income/(loss)	433	767	1,139	1,735	(1,442)	1,507	(6,720)	(1,561)	718	1,645
Dividends from joint ventures	300	1,400	691	1,224	-	-	-	-	-	1,750
Share of net profit/(loss) from joint ventures	217	384	456	694	911	1,235	(2,301)	(488)	359	823
Share of other comprehensive loss from joint ventures (iii)	-	-	-	-	(1,593)	(522)	(219)	(98)	-	-

(c)

Major financial information of principal associates

	PipeChina	Sinopec Finance	SIBUR	Zhongtian Synergetic Energy	CIR
	At	At	At	At	At	At	At	At	At
	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December
	2020	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets	74,012	175,139	180,383	30,678	31,634	3,721	4,219	2,402	7,612
Non-current assets	655,982	53,008	18,926	147,140	182,646	53,124	56,424	903	971
Current liabilities	(55,562)	(197,872)	(170,621)	(31,157)	(31,295)	(8,315)	(13,887)	(699)	(936)
Non-current liabilities	(104,150)	(514)	(582)	(58,941)	(71,289)	(28,422)	(26,227)	(286)	(166)
Net assets	570,282	29,761	28,106	87,720	111,696	20,108	20,529	2,320	7,481
Net assets attributable to shareholders of the Company	505,336	29,761	28,106	87,280	111,250	20,108	20,529	2,320	7,481
Net assets attributable to minority interests	64,946	-	-	440	446	-	-	-	-
Share of net assets from associates	70,747	14,583	13,772	8,728	11,125	7,792	7,955	1,160	3,741
Carrying Amounts	70,747	14,583	13,772	8,728	11,125	7,792	7,955	1,160	3,741

	PipeChina (iv)	Sinopec Finance	SIBUR	Zhongtian Synergetic Energy	CIR
	2020	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	22,766	4,742	4,966	49,793	56,706	11,707	13,329	1,252	2,334
Profit/(loss) for the year	6,444	2,027	2,234	(1,936)	6,513	551	1,994	181	424
Other comprehensive (loss)/income	-	(372)	411	(19,180)	(1,435)	-	-	(308)	151
Total comprehensive income/(loss)	6,444	1,655	2,645	(21,116)	5,078	551	1,994	(127)	575
Dividends declared by associates	-	-	-	285	468	284	219	2,517	-
Share of profit/(loss) from associates	709	993	1,095	(194)	651	214	773	91	212
Share of other comprehensive (loss)/income from associates (iii)	-	(182)	201	(1,918)	(144)	-	-	(154)	76

(i)

Additions for the year mainly arise from the Company and Sinopec Natural Gas Limited Company acquiring 14% of PipeChina in total. The Group has a member stationed on the board of directors of PipeChina. According to the structure and the resolution mechanism of the board of directors, the Group can exercise significant influence on PipeChina.

(ii)

Sinopec is able to exercise significant influence in SIBUR since Sinopec has a member in SIBUR's Board of Directors and has a member in SIBUR's Management Board.

(iii)

Including foreign currency translation differences.

(iv)

The summarised income statement for the year 2020 presents the operating results from the date when the Group can exercise significant influence on PipeChina to 31 December 2020.

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Fixed assets (a)	589,247	625,692
Fixed assets pending for disposal	38	14
Total	589,285	625,706

(a)

Fixed assets

	Plants and buildings	Oil and gas properties	Equipment, machinery and others	Total
	RMB million	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2020	130,234	727,552	1,016,794	1,874,580
Additions for the year	390	1,563	5,147	7,100
Transferred from construction in progress	10,848	32,214	98,095	141,157
Reclassifications	1,443	(125)	(1,318)	-
Decreases for the year (i)	(6,329)	(806)	(132,398)	(139,533)
Exchange adjustments	(141)	(2,806)	(226)	(3,173)
Balance at 31 December 2020	136,445	757,592	986,094	1,880,131
Accumulated depreciation:
Balance at 1 January 2020	55,882	543,629	570,658	1,170,169
Additions for the year	4,628	32,054	48,380	85,062
Reclassifications	393	(98)	(295)	-
Decreases for the year (i)	(2,370)	(462)	(47,062)	(49,894)
Exchange adjustments	(49)	(2,520)	(136)	(2,705)
Balance at 31 December 2020	58,484	572,603	571,545	1,202,632
Provision for impairment losses:
Balance at 1 January 2020	3,977	43,563	31,179	78,719
Additions for the year	683	4,739	6,292	11,714
Reclassifications	-	-	-	-
Decreases for the year (i)	(847)	(2)	(1,147)	(1,996)
Exchange adjustments	-	(183)	(2)	(185)
Balance at 31 December 2020	3,813	48,117	36,322	88,252
Net book value:
Balance at 31 December 2020	74,148	136,872	378,227	589,247
Balance at 31 December 2019	70,375	140,360	414,957	625,692

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Fixed assets (a)	283,691	291,544
Fixed assets pending for disposal	4	3
Total	283,695	291,547

(a)

Fixed assets

	Plants and buildings	Oil and gas properties	Equipment, machinery and others	Total
	RMB million	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2020	49,000	598,304	472,250	1,119,554
Additions for the year	177	1,256	1,636	3,069
Transferred from construction in progress	1,377	22,527	26,490	50,394
Reclassifications	384	(86)	(298)	-
Transferred from subsidiaries	71	-	928	999
Transferred to subsidiaries	(1,060)	(481)	(6,673)	(8,214)
Decreases for the year	(593)	(3,037)	(9,982)	(13,612)
Balance at 31 December 2020	49,356	618,483	484,351	1,152,190
Accumulated depreciation:
Balance at 1 January 2020	24,232	446,076	297,682	767,990
Additions for the year	1,544	24,207	21,031	46,782
Reclassifications	187	(64)	(123)	-
Transferred from subsidiaries	32	-	372	404
Transferred to subsidiaries	(514)	(250)	(3,546)	(4,310)
Decreases for the year	(292)	(1,251)	(5,575)	(7,118)
Balance at 31 December 2020	25,189	468,718	309,841	803,748
Provision for impairment losses:
Balance at 1 January 2020	1,795	37,383	20,842	60,020
Additions for the year	528	4,023	3,677	8,228
Reclassifications	-	-	-	-
Transferred from subsidiaries	-	-	-	-
Transferred to subsidiaries	(305)	-	(2,288)	(2,593)
Decreases for the year	(101)	-	(803)	(904)
Balance at 31 December 2020	1,917	41,406	21,428	64,751
Net book value:
Balance at 31 December 2020	22,250	108,359	153,082	283,691
Balance at 31 December 2019	22,973	114,845	153,726	291,544

(i)

Disposals for the year ended 31 December 2020 mainly due to the Company and its subsidiaries disposed their oil and gas pipeline and ancillary facilities to PipeChina.

	The Group	The Company
	RMB million	RMB million
Cost:
Balance at 1 January 2020	175,716	60,906
Additions for the year	130,283	62,427
Disposals for the year	(20,520)	(4,771)
Transferred to subsidiaries	-	(2,120)
Dry hole costs written off	(5,928)	(5,160)
Transferred to fixed assets	(141,157)	(50,394)
Reclassification to other assets	(11,464)	(706)
Exchange adjustments	(118)	-
Balance at 31 December 2020	126,812	60,182
Provision for impairment losses:
Balance at 1 January 2020	1,844	413
Additions for the year	844	293
Decreases for the year	(576)	(404)
Exchange adjustments	(65)	-
Balance at 31 December 2020	2,047	302
Net book value:
Balance at 31 December 2020	124,765	59,880
Balance at 31 December 2019	173,872	60,493

Project name	Budgeted amount	Balance at 1 January 2020	Net change for the year	Balance at 31 December 2020	Percentage of project investment to budgeted amount	Source of funding	Accumulated interest capitalised at 31 December 2020
	RMB million	RMB million	RMB million	RMB million			RMB million
Zhenhai Refining and Chemical ethylene expansion project	26,680	1,688	5,944	7,632	34%	Bank loans & self-financing	17
Hainan Refining and Chemical ethylene and oil refinery expansion project	28,085	502	4,500	5,002	18%	Self-financing	-
Western Sichuan Gas Field Leikoupo Formation Gas Reservoir Development and Construction Project	10,423	1,024	403	1,427	14%	Bank loans & self-financing	43
Caprolactam industry chain relocation and upgrading transformation development project	13,950	-	1,000	1,000	7%	Bank loans	5
Weirong field Longmaxi Formation Shale Gas Production Capacity Construction Project (Second-stage)	6,747	-	865	865	15%	Bank loans & self-financing	6

	Land	Others	Total
	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2020	176,132	34,188	210,320
Additions for the year	3,186	10,222	13,408
Decreases for the year	(7,930)	(3,142)	(11,072)
Balance at 31 December 2020	171,388	41,268	212,656
Accumulated depreciation:
Balance at 1 January 2020	6,567	5,702	12,269
Additions for the year	6,488	6,354	12,842
Decreases for the year	(463)	(1,575)	(2,038)
Balance at 31 December 2020	12,592	10,481	23,073
Provision for impairment losses:
Balance at 1 January 2020	-	-	-
Additions for the year	-	-	-
Decreases for the year	-	-	-
Balance at 31 December 2020	-	-	-
Net book value:
Balance at 31 December 2020	158,796	30,787	189,583
Balance at 31 December 2019	169,565	28,486	198,051

	Land	Others	Total
	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2020	116,073	1,121	117,194
Additions for the year	602	1,277	1,879
Decreases for the year	(1,628)	(126)	(1,754)
Balance at 31 December 2020	115,047	2,272	117,319
Accumulated depreciation:
Balance at 1 January 2020	3,796	566	4,362
Additions for the year	3,751	623	4,374
Decreases for the year	(53)	(101)	(154)
Balance at 31 December 2020	7,494	1,088	8,582
Provision for impairment losses:
Balance at 1 January 2020	-	-	-
Additions for the year	-	-	-
Decreases for the year	-	-	-
Balance at 31 December 2020	-	-	-
Net book value:
Balance at 31 December 2020	107,553	1,184	108,737
Balance at 31 December 2019	112,277	555	112,832

	Land use rights	Patents	Non-patent technology	Operation rights	Others	Total
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2020	92,648	5,344	5,035	53,549	5,700	162,276
Additions for the year	10,795	33	729	493	654	12,704
Decreases for the year	(1,475)	-	(187)	(475)	(204)	(2,341)
Balance at 31 December 2020	101,968	5,377	5,577	53,567	6,150	172,639
Accumulated amortisation:
Balance at 1 January 2020	22,534	3,601	3,277	19,391	3,535	52,338
Additions for the year	2,759	187	225	2,318	513	6,002
Decreases for the year	(336)	-	(41)	(187)	(144)	(708)
Balance at 31 December 2020	24,957	3,788	3,461	21,522	3,904	57,632
Provision for impairment losses:
Balance at 1 January 2020	228	482	27	145	17	899
Additions for the year	-	-	24	47	-	71
Decreases for the year	(2)	-	(24)	(3)	-	(29)
Balance at 31 December 2020	226	482	27	189	17	941
Net book value:
Balance at 31 December 2020	76,785	1,107	2,089	31,856	2,229	114,066
Balance at 31 December 2019	69,886	1,261	1,731	34,013	2,148	109,039

Name of investees	Principal activities	At 31 December	At 31 December
		2020	2019
		RMB million	RMB million
Sinopec Zhenhai Refining and Chemical Branch	Manufacturing of intermediate petrochemical products and petroleum products	4,043	4,043
Shanghai SECCO Petrochemical Company Limited ('Shanghai SECCO')	Production and sale of petrochemical products	2,541	2,541
Sinopec Beijing Yanshan Petrochemical Branch	Manufacturing of intermediate petrochemical products and petroleum products	1,004	1,004
Other units without individual significant goodwill		1,032	1,109
Total		8,620	8,697

	Deferred tax assets	Deferred tax liabilities
	At 31 December	At 31 December	At 31 December	At 31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Receivables and inventories	2,411	2,546	-	-
Payables	1,286	1,142	-	-
Cash flow hedges	1,790	116	(4,420)	(384)
Fixed assets	15,793	16,463	(13,415)	(12,317)
Tax value of losses carried forward	13,322	3,594	-	-
Other equity instrument investments	127	131	(11)	(7)
Intangible assets	869	595	(517)	(508)
Others	371	318	(676)	(882)
Deferred tax assets/(liabilities)	35,969	24,905	(19,039)	(14,098)

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Deferred tax assets	10,915	7,289
Deferred tax liabilities	10,915	7,289

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Deferred tax assets	25,054	17,616
Deferred tax liabilities	8,124	6,809

	Note	Balance at 1 January 2020	Provision for the year	Written back for the year	Written off for the year	Other increase/ (decrease)	Balance at 31 December 2020
		RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Allowance for doubtful accounts
Included: Accounts receivable	7	1,848	2,173	(68)	(23)	(70)	3,860
Prepayments	9	80	181	(84)	-	(100)	77
Other receivables	10	1,456	195	(220)	(18)	118	1,531
		3,384	2,549	(372)	(41)	(52)	5,468
Inventories	11	2,585	11,689	(328)	(10,795)	(51)	3,100
Long-term equity investments	12	1,710	1,955	-	(4)	(113)	3,548
Fixed assets	13	78,719	11,714	-	(2,395)	214	88,252
Construction in progress	14	1,844	844	-	(171)	(470)	2,047
Intangible assets	16	899	47	-	(5)	-	941
Goodwill	17	7,861	-	-	-	-	7,861
Others		6	-	(14)	-	14	6
Total		97,008	28,798	(714)	(13,411)	(458)	111,223

	At 31 December 2020	At 31 December 2019
	Original currency million	Exchange rates	RMB million	Original currency million	Exchange rates	RMB million
Short-term bank loans			16,111			25,709
－Renminbi loans			16,111			25,619
－US Dollar loans	-	6.5249	-	13	6.9762	90
Short-term other loans			3			22
－Renminbi loans			3			22
Short-term loans from Sinopec Group Company and fellow subsidiaries			4,642			5,465
－Renminbi loans			1,141			2,709
－US Dollar loans	505	6.5249	3,298	321	6.9762	2,236
－Hong Kong Dollar loans	37	0.8416	31	553	0.8958	495
－Euro loans	21	8.0250	172	3	7.8155	25
Total			20,756			31,196

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Value-added tax payable	5,085	4,944
Consumption tax payable	56,762	53,007
Income tax payable	6,586	3,267
Mineral resources compensation fee payable	132	136
Other taxes	8,278	8,170
Total	76,843	69,524

	At 31 December 2020	At 31 December 2019
	Original currency million	Exchange rates	RMB million	Original currency million	Exchange rates	RMB million
Long-term bank loans
- Renminbi loans			4,613			1,765
- US Dollar loans	4	6.5249	24	4	6.9762	25
Long-term loans from Sinopec Group Company and fellow subsidiaries
- Renminbi loans			622			37,824
Long-term loans due within one year			5,259			39,614
Debentures payable due within one year
- Renminbi debentures			-			13,000
Debentures payable due within one year			-			13,000
Lease liabilities due within one year			15,292			15,198
Others			1,942			1,678
Non-current liabilities due within one year			22,493			69,490

		At 31 December 2020	At 31 December 2019
	Interest rate and final maturity	Original currency million	Exchange rates	RMB million	Original currency million	Exchange rates	RMB million
Long-term bank loans
- Renminbi loans	Interest rates ranging from interest 1.08% to 5.23% per annum at 31 December 2020 with maturities through 2030			38,226			31,714
- US Dollar loans	Interest rates at 1.55% per annum at 31 December 2020 with maturities through 2039	14	6.5249	92	18	6.9762	127
Less: Current portion				(4,637)			(1,790)
Long-term bank loans				33,681			30,051
Long-term loans from Sinopec Group Company and fellow subsidiaries
- Renminbi loans	Interest rates ranging from interest 1.08% to 5.23% per annum at 31 December 2020 with maturities through 2036			11,013			47,450
- US Dollar loans	Interest rates at 1.60% per annum at 31 December 2020 with maturities in 2027	213	6.5249	1,387	-	6.9762	-
Less: Current portion				(622)			(37,824)
Long-term loans from Sinopec Group Company and fellow subsidiaries			11,778			9,626
Total				45,459			39,677

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Between one and two years	3,520	5,089
Between two and five years	39,504	12,138
After five years	2,435	22,450
Total	45,459	39,677

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Debentures payable:
- Corporate Bonds (i)	38,356	32,157
Less: Current portion	-	(13,000)
Total	38,356	19,157

(i)

The Company issued corporate bonds with a maturity of three years on 31 March 2020 at par value of RMB 100. The total issued amount of the corporate bonds is RMB 10 billion. The corporate bonds adopt a simple interest rate on an annual basis with a fixed rate at 2.70% per annum and the interest is paid once a year.

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Lease liabilities	187,598	192,872
Deduct: Current portion of lease liabilities (Note 29)	15,292	15,198
Total	172,306	177,674

	The Group
	RMB million
Balance at 1 January 2020	42,438
Provision for the year	1,563
Accretion expenses	1,343
Decrease for the year	(1,490)
Exchange adjustments	(141)
Balance at 31 December 2020	43,713

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Registered, issued and fully paid:
95,557,771,046 listed A shares (2019: 95,557,771,046) of RMB 1.00 each	95,558	95,558
25,513,438,600 listed H shares (2019: 25,513,438,600) of RMB 1.00 each	25,513	25,513
Total	121,071	121,071

	RMB million
Balance at 1 January 2020	122,864
Adjustment for business combination of entities under common control	(972)
Transaction with minority interests	(138)
Others	804
Balance at 31 December 2020	122,558

(a)

The changes of other comprehensive income in consolidated income statement

	2020
	Before-tax amount	Tax effect	Net-of-tax amount
	RMB million	RMB million	RMB million
Cash flow hedges:
Effective portion of changes in fair value of hedging instruments recognised during the year	9,207	(2,295)	6,912
Less: Reclassification adjustments for amounts transferred to the consolidated income statement	(198)	37	(161)
Subtotal	9,405	(2,332)	7,073
Changes in fair value of other equity instrument investments	(6)	(4)	(10)
Less: subtotal of amounts previously recognized in other comprehensive income transferred to retained earnings for the year	12	-	12
Subtotal	(18)	(4)	(22)
Fair value hedges	162	-	162
Subtotal	162	-	162
Other comprehensive loss that can be converted into profit or loss under the equity method	(2,441)	-	(2,441)
Subtotal	(2,441)	-	(2,441)
Foreign currency translation differences	(4,457)	-	(4,457)
Subtotal	(4,457)	-	(4,457)
Other comprehensive income	2,651	(2,336)	315

	2019
	Before-tax amount	Tax effect	Net-of-tax amount
	RMB million	RMB million	RMB million
Cash flow hedges:
Effective portion of changes in fair value of hedging instruments recognised during the year	5,258	(974)	4,284
Less: Reclassification adjustments for amounts transferred to the consolidated income statement	(853)	196	(657)
Subtotal	6,111	(1,170)	4,941
Changes in fair value of other equity instrument investments	(39)	8	(31)
Subtotal	(39)	8	(31)
Other comprehensive loss that can be converted into profit or loss under the equity method	(810)	-	(810)
Subtotal	(810)	-	(810)
Foreign currency translation differences	1,480	-	1,480
Subtotal	1,480	-	1,480
Other comprehensive income	6,742	(1,162)	5,580

(b)

The change of each item in other comprehensive income

	Equity Attributable to shareholders of the company
	Other comprehensive income that can be converted into profit or loss under the equity method	Changes in fair value of other equity instrument investments	Fair value hedges	Cash flow hedges	Foreign currency translation differences	Subtotal	Minority interests	Total other comprehensive income
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
1 January 2019	(3,664)	4	-	(4,917)	1,803	(6,774)	(1,789)	(8,563)
Changes in 2019	(424)	(20)	-	5,954	943	6,453	220	6,673
31 December 2019	(4,088)	(16)	-	1,037	2,746	(321)	(1,569)	(1,890)
1 January 2020	(4,088)	(16)	-	1,037	2,746	(321)	(1,569)	(1,890)
Changes in 2020	(2,001)	(4)	81	6,768	(3,485)	1,359	(1,031)	328
31 December 2020	(6,089)	(20)	81	7,805	(739)	1,038	(2,600)	(1,562)

	The Group
	Statutory	Discretionary
	surplus reserve	surplus reserves	Total
	RMB million	RMB million	RMB million
Balance at 1 January 2020	90,423	117,000	207,423
Appropriation	1,857	-	1,857
Balance at 31 December 2020	92,280	117,000	209,280

(a)

10% of the net profit is transferred to the statutory surplus reserve. In the event that the reserve balance reaches 50% of the registered capital, no transfer is needed;

(b)

After the transfer to the statutory surplus reserve, a transfer to discretionary surplus reserve can be made upon the passing of a resolution at the shareholders' meeting.

	The Group	The Company
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Income from principal operations	2,049,456	2,899,682	743,188	984,185
Income from other operations	56,528	60,117	27,133	37,087
Total	2,105,984	2,959,799	770,321	1,021,272
Operating costs	1,688,398	2,479,356	584,315	799,566

	2020	2019
	RMB million	RMB million
Income from principal operations	2,049,456	2,899,682
Gasoline	557,605	699,202
Diesel	422,569	615,342
Crude oil	351,707	549,720
Basic chemical feedstock	155,687	215,773
Synthetic resin	122,313	125,658
Kerosene	72,385	191,636
Natural gas	48,121	53,839
Synthetic fiber monomers and polymers	41,640	80,100
Others (i)	277,429	368,412
Income from other operations	56,528	60,117
Sale of materials and others	55,441	58,886
Rental income	1,087	1,231
Total	2,105,984	2,959,799

(i)

Others are primarily liquefied petroleum gas and other refinery and chemical byproducts and joint products.

	2020	2019
	RMB million	RMB million
Consumption tax	197,542	204,388
City construction tax	15,699	16,387
Education surcharge	11,670	12,111
Resources tax	4,572	5,883
Others	5,464	5,748
Total	234,947	244,517

	2020	2019
	RMB million	RMB million
Interest expenses incurred	6,513	7,039
Less: Capitalised interest expenses	2,011	1,015
Add: Interest expense on lease liabilities	9,349	9,646
Net interest expenses	13,851	15,670
Accretion expenses (Note 34)	1,343	1,418
Interest income	(4,803)	(7,210)
Net foreign exchange (gains)/losses	(885)	170
Total	9,506	10,048

	2020	2019
	RMB million	RMB million
Purchased crude oil, products and operating supplies and expenses	1,594,130	2,370,699
Personnel expenses	86,006	82,743
Depreciation, depletion and amortisation	106,965	109,172
Exploration expenses (including dry holes)	9,716	10,510
Other expenses	42,112	52,816
Total	1,838,929	2,625,940

	The Group	The Company
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Income from investment of subsidiaries accounted for under cost method	-	-	19,296	25,416
Income from investment accounted for under equity method	6,712	12,777	3,637	3,579
Investment income/(loss) from disposal of business and long-term equity investments (i)	37,525	185	21,079	(1,543)
Dividend income from holding of other equity instrument investments	156	492	16	53
Investment income/(loss) from holding/disposal of financial assets and liabilities and derivative financial instruments at fair value through profit or loss	687	(1,467)	(1,013)	142
Gain from ineffective portion of cash flow hedges	2,475	587	84	1
Others	(69)	54	257	414
Total	47,486	12,628	43,356	28,062

(i)

The Company and Sinomart KTS Development Limited, Sinopec Natural Gas Limited Company and Sinopec Marketing Company Limited('Marketing Company'), the subsidiaries of the Company entered into the Agreement on Cash Payment to Purchase Equity in Sinopec Yu Ji Pipeline Company Limited, the Agreement on Additional Issuance of Equity and Cash Payment to Purchase Assets, the Agreement on Cash Payment to Purchase Assets and the Agreement on Additional Issuance of Equity to Purchase Assets with PipeChina, on 21 July 2020 and on 23 July 2020 respectively, pursuant to which the Company and its subsidiaries proposed to dispose target business, including equity interests in the relevant companies, oil and gas pipeline and ancillary facilities, to PipeChina. The above transactions were considered and approved by the 15th Session of 7th Directorate Meeting on 23 July 2020 and the second Extraordinary General Meeting on 28 September 2020. The transaction consideration was mainly additional issuance of equity and/or cash payment by PipeChina and the gain on above transactions was RMB 37,731 million. Main assets and liabilities of disposed target business are as follows:

	30 September 2020
	RMB million
Inventories	8,191
Long-term equity investments	26,412
Fixed assets	83,510
Construction in progress	19,843
Long-term loans	(41,800)
Other financial statement items	(9,035)
Net Assets	87,121

	2020	2019
	RMB million	RMB million
Net fair value losses on financial assets and financial liabilities at fair value through profit or loss	(1,824)	(2,702)
Unrealised gains/(losses) from ineffective portion cash flow hedges, net	576	(809)
Others	(5)	-
Total	(1,253)	(3,511)

	2020	2019
	RMB million	RMB million
Prepayments	97	30
Inventories	11,361	1,417
Long-term equity investment	1,955	-
Fixed assets	11,714	196
Construction in progress	844	135
Others	47	1
Total	26,018	1,779

	2020	2019
	RMB million	RMB million
Government grants	1,210	884
Others	1,160	1,717
Total	2,370	2,601

	2020	2019
	RMB million	RMB million
Fines, penalties and compensation	43	173
Donations	301	210
Others	4,388	2,241
Total	4,732	2,624

	2020	2019
	RMB million	RMB million
Provision for income tax for the year	14,209	15,021
Deferred taxation	(7,873)	3,385
Under-provision for income tax in respect of preceding year	(117)	(467)
Total	6,219	17,939

	2020	2019
	RMB million	RMB million
Profit before taxation	47,969	90,111
Expected income tax expense at a tax rate of 25%	11,992	22,528
Tax effect of non-deductible expenses	3,333	2,299
Tax effect of non-taxable income (i)	(8,345)	(4,458)
Tax effect of preferential tax rate (ii)	(1,011)	(2,003)
Effect of income taxes at foreign operations	(730)	(312)
Tax effect of utilisation of previously unrecognised tax losses and temporary differences	(65)	(335)
Tax effect of tax losses not recognised	1,087	498
Write-down of deferred tax assets	75	189
Adjustment for under provision for income tax in respect of preceding years	(117)	(467)
Actual income tax expense	6,219	17,939

(i)

In 2020, the tax effect of non-taxable income includes the tax exempt investment income of joint ventures and associates and the tax exempt part of the gain related to the disposal of oil and gas pipeline and ancillary facilities.

(ii)

The provision for PRC current income tax is based on a statutory income tax rate of 25% of the assessable income of the Group as determined in accordance with the relevant income tax rules and regulations of the PRC, except for certain entities of the Group in western regions in the PRC are taxed at preferential income tax rate of 15% through the year 2020. According to Announcement [2020] No.23 of the MOF 'Announcement of the MOF, the State Taxation Administration and the National Development and Reform Commission on continuation of the income tax policy of western development enterprises', the preferential income tax rate of 15% extends from 1 January 2021 to 31 December 2030.

(a)

Dividends of ordinary shares declared after the balance sheet date

(b)

Dividends of ordinary shares declared during the year

(a)

Reconciliation of net profit to cash flows from operating activities:

	2020	2019
	RMB million	RMB million
Net profit	41,750	72,172
Add: Impairment losses on assets	26,018	1,779
Credit impairment losses	2,066	1,264
Depreciation of right-of-use assets	12,813	12,246
Depreciation of fixed assets	85,046	87,960
Amortisation of intangible assets and long-term deferred expenses	9,106	8,966
Dry hole costs written off	5,928	5,831
Net (gain)/loss on disposal of non-current assets	(398)	1,829
Fair value loss	1,253	3,511
Financial expenses	11,765	10,433
Investment income	(47,486)	(12,628)
(Increase)/decrease in deferred tax assets	(10,143)	3,124
Increase in deferred tax liabilities	2,270	261
Decrease/(increase) in inventories	22,703	(9,748)
Safety fund reserve	237	69
Increase in operating receivables	(17,623)	(11,915)
Increase/(decrease) in operating payables	22,213	(21,535)
Net cash flow from operating activities	167,518	153,619

(b)

Net change in cash:

	2020	2019
	RMB million	RMB million
Cash balance at the end of the year	87,559	60,438
Less: Cash at the beginning of the year	60,438	111,927
Net increase/(decrease) of cash	27,121	(51,489)

(c)

The analysis of cash held by the Group is as follows:

	2020	2019
	RMB million	RMB million
Cash at bank and on hand
- Cash on hand	8	14
- Demand deposits	87,551	60,424
Cash at the end of the year	87,559	60,438

(d)

Net cash received from disposal of subsidiaries and other business entities:

	2020	2019
	RMB million	RMB million
Cash received from disposal of equity interests in the relevant companies, oil and gas pipeline and ancillary facilities	49,832	-
Others	37	-
Total	49,869	-

(e)

Other cash paid relating to financing activities:

	2020	2019
	RMB million	RMB million
Repayments of lease liabilities	15,327	16,859
Others	1,882	328
Total	17,209	17,187

(1)

Related parties having the ability to exercise control over the Group

The name of the company	:	China Petrochemical Corporation
Unified social credit identifier	:	9111000010169286X1
Registered address	:	No. 22, Chaoyangmen North Street, Chaoyang District, Beijing
Principal activities	:	Exploration, production, storage and transportation (including pipeline transportation), sales and utilisation of crude oil and natural gas; refining; wholesale and retail of gasoline, kerosene and diesel; production, sales, storage and transportation of petrochemical and other chemical products; industrial investment and investment management; exploration, construction, installation and maintenance of petroleum and petrochemical constructions and equipments; manufacturing electrical equipment; research, development, application and consulting services of information technology and alternative energy products; import & export of goods and technology.
Relationship with the Group	:	Ultimate holding company
Types of legal entity	:	State-owned
Authorised representative	:	Zhang Yuzhuo
Registered capital	:	RMB 326,547 million

(2)

Related parties not having the ability to exercise control over the Group

(3)

The principal related party transactions with Sinopec Group Company and fellow subsidiaries, associates and joint ventures, which were carried out in the ordinary course of business, are as follows:

		The Group
	Note	2020	2019
		RMB million	RMB million
Sales of goods	(i)	233,283	285,853
Purchases	(ii)	158,963	189,914
Transportation and storage	(iii)	8,848	8,206
Exploration and development services	(iv)	31,444	33,310
Production related services	(v)	32,106	38,827
Ancillary and social services	(vi)	3,099	3,098
Agency commission income	(vii)	160	116
Interest income	(viii)	704	1,066
Interest expense	(ix)	919	1,334
Net deposits (placed with)/withdrawn from related parties	(viii)	(17,585)	5,230
Net funds (repaid to)/obtained from related parties	(x)	(31,144)	3,438

(i)

Sales of goods represent the sale of crude oil, intermediate petrochemical products, petroleum products and ancillary materials.

(ii)

Purchases represent the purchase of materials and utility supplies directly related to the Group's operations such as the procurement of raw and ancillary materials and related services, supply of water, electricity and gas.

(iii)

Transportation and storage represent the cost for the use of railway, road and marine transportation services, pipelines, loading, unloading and storage facilities.

(iv)

Exploration and development services comprise direct costs incurred in the exploration and development such as geophysical, drilling, well testing and well measurement services.

(v)

Production related services represent ancillary services rendered in relation to the Group's operations such as equipment repair and general maintenance, insurance premium, technical research, communications, firefighting, security, product quality testing and analysis, information technology, design and engineering, construction of oilfield ground facilities, refineries and chemical plants, manufacture of replacement parts and machinery, installation, project management and environmental protection, and management services.

(vi)

Ancillary and social services represent expenditures for social welfare and support services such as educational facilities, media communication services, sanitation, accommodation, canteens and property maintenance.

(vii)

Agency commission income represents commission earned for acting as an agent in respect of sales of products and purchase of materials for certain entities owned by Sinopec Group Company.

(3)

The principal related party transactions with Sinopec Group Company and fellow subsidiaries, associates and joint ventures, which were carried out in the ordinary course of business, are as follows (Continued):

(viii)

Interest income represents interest received from deposits placed with Sinopec Finance and Sinopec Century Bright Capital Investment Limited, finance companies controlled by Sinopec Group Company. The applicable interest rate is determined in accordance with the prevailing saving deposit rate.

(ix)

Interest expense represents interest charges on the loans obtained from Sinopec Group Company and fellow subsidiaries.

(x)

The Group obtained loans, discounted bills and others from Sinopec Group Company and fellow subsidiaries.

(a)

The Company has entered into a non-exclusive 'Agreement for Mutual Provision of Products and Ancillary Services' ('Mutual Provision Agreement') with Sinopec Group Company effective from 1 January 2000 in which Sinopec Group Company has agreed to provide the Group with certain ancillary production services, construction services, information advisory services, supply services and other services and products. While each of Sinopec Group Company and the Company is permitted to terminate the Mutual Provision Agreement upon at least six months' notice, Sinopec Group Company has agreed not to terminate the agreement if the Group is unable to obtain comparable services from a third party. The pricing policy for these services and products provided by Sinopec Group Company to the Group is as follows:

‧

the government-prescribed price;

‧

where there is no government-prescribed price, the government-guidance price;

‧

where there is neither a government-prescribed price nor a government-guidance price, the market price; or

‧

where none of the above is applicable, the price to be agreed between the parties, which shall be based on a reasonable cost incurred in providing such services plus a profit margin not exceeding 6%.

(b)

The Company has entered into a non-exclusive 'Agreement for Provision of Cultural and Educational, Health Care and Community Services' with Sinopec Group Company effective from 1 January 2000 in which Sinopec Group Company has agreed to provide the Group with certain cultural, educational, health care and community services on the same pricing terms and termination conditions as agreed to in the above Mutual Provision Agreement.

(c)

The Company has entered into a number of lease agreements with Sinopec Group Company to lease certain lands and buildings effective on 1 January 2000. The lease term is 40 or 50 years for lands and 20 years for buildings, respectively. The Company and Sinopec Group Company can renegotiate the rental amount every three years for land. The Company and Sinopec Group Company can renegotiate the rental amount for buildings every year. However such amount cannot exceed the market price as determined by an independent third party.

(d)

The Company has entered into agreements with Sinopec Group Company effective from 1 January 2000 under which the Group has been granted the right to use certain trademarks, patents, technology and computer software developed by Sinopec Group Company.

(e)

The Company has entered into a service station franchise agreement with Sinopec Group Company effective from 1 January 2000 under which its service stations and retail stores would exclusively sell the refined products supplied by the Group.

(f)

On the basis of a series of continuing connected transaction agreements signed in 2000, the Company and Sinopec Group Company have signed the Fifth Supplementary Agreement and the Fourth Revised Memorandum of land use rights leasing contract on 24 August 2018, which took effect on 1 January 2019 and made adjustment to 'Mutual Supply Agreement', 'Agreement for Provision of Cultural and Educational, Health Care and Community Services', 'Buildings Leasing Contract', 'Intellectual Property Contract' and 'Land Use Rights Leasing Contract', etc.

(4)

Balances with Sinopec Group Company and fellow subsidiaries, associates and joint ventures

	The ultimate holding company	Other related companies
	At 31 December	At 31 December	At 31 December	At 31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Cash at bank and on hand	-	-	53,417	35,832
Accounts receivable	42	52	16,854	12,418
Receivables financing	-	-	760	407
Other receivables	-	60	18,062	11,423
Prepayments and other current assets	7	6	1,236	1,282
Other non-current assets	-	-	6,435	734
Bills payable	8	17	3,671	3,801
Accounts payable	122	94	19,004	21,265
Contract liabilities	41	51	5,899	4,405
Other payables	38	64	12,078	18,729
Other non-current liabilities	-	-	3,010	-
Short-term loans	-	-	4,642	5,465
Long-term loans (including current portion)	-	-	12,400	47,450
Lease liabilities (including current portion)	74,178	82,255	87,870	89,147

(5)

Key management personnel emoluments

	2020	2019
	RMB thousand	RMB thousand
Short-term employee benefits	5,753	9,209
Retirement scheme contributions	342	536
Total	6,095	9,745

(a)

Oil and gas properties and reserves

(b)

Impairment for assets

(c)

Depreciation

(d)

Measurement of expected credit losses

(e)

Allowance for diminution in value of inventories

Full name of enterprise	Principal activities	Registered capital/ paid-up capital	Actual investment at 31 December 2020	Percentage of equity interest/ voting right held by the Group	Minority Interests at 31 December 2020
		million	million	%	RMB million
(a) Subsidiaries acquired through group restructuring:
China Petrochemical International Company Limited	Trading of petrochemical products	RMB 1,400	RMB 1,856	100.00	17
China International United Petroleum and Chemical Company Limited	Trading of crude oil and petrochemical products	RMB 5,000	RMB 6,585	100.00	5,171
Sinopec Catalyst Company Limited	Production and sale of catalyst products	RMB 1,500	RMB 2,424	100.00	267
Sinopec Yangzi Petrochemical Company Limited	Manufacturing of intermediate petrochemical products and petroleum products	RMB 15,651	RMB 15,651	100.00	-
Sinopec Lubricant Company Limited	Production and sale of refined petroleum products, lubricant base oil, and petrochemical materials	RMB 3,374	RMB 3,374	100.00	84
Sinopec Yizheng Chemical Fibre Limited Liability Company	Production and sale of polyester chips and polyester fibres	RMB 4,000	RMB 6,713	100.00	_
Marketing Company	Marketing and distribution of refined petroleum products	RMB 28,403	RMB 20,000	70.42	75,486
Sinopec Kantons Holdings Limited ('Sinopec Kantons')	Provision of crude oil jetty services and natural gas pipeline transmission services	HKD 248	HKD 3,952	60.33	4,931
Sinopec Shanghai Petrochemical Company Limited ('Shanghai Petrochemical')	Manufacturing of synthetic fibres, resin and plastics, intermediate petrochemical products and petroleum products	RMB 10,824	RMB 5,820	50.44	14,617
Fujian Petrochemical Company Limited ('Fujian Petrochemical') (i)	Manufacturing of plastics, intermediate petrochemical products and petroleum products	RMB 10,492	RMB 5,246	50.00	6,500
(b) Subsidiaries established by the Group:
Sinopec International Petroleum Exploration and Production Limited ('SIPL')	Investment in exploration, production and sale of petroleum and natural gas	RMB 8,250	RMB 8,250	100.00	6,950
Sinopec Overseas Investment Holding Limited ('SOIH')	Investment holding of overseas business	USD 1,662	USD 1,959	100.00	-
Sinopec Chemical Sales Company Limited	Marketing and distribution of petrochemical products	RMB 1,000	RMB 1,165	100.00	91
Sinopec Great Wall Energy & Chemical Company Limited	Coal chemical industry investment management, production and sale of coal chemical products	RMB 22,761	RMB 22,795	100.00	(258)
Sinopec Beihai Refining and Chemical Limited Liability Company	Import and processing of crude oil, production, storage and sale of petroleum products and petrochemical products	RMB 5,294	RMB 5,240	98.98	117
ZhongKe (Guangdong) Refinery & Petrochemical Company Limited	Crude oil processing and petroleum products manufacturing	RMB 6,397	RMB 5,776	90.30	1,909
Sinopec Qingdao Refining and Chemical Company Limited	Manufacturing of intermediate petrochemical products and petroleum products	RMB 5,000	RMB 4,250	85.00	1,518
Sinopec-SK	Production, sale, research and development of ethylene and downstream byproducts	RMB 7,193	RMB 7,193	59.00	4,485
(c) Subsidiaries acquired through business combination under common control:
Sinopec Hainan Refining and Chemical Company Limited	Manufacturing of intermediate petrochemical products and petroleum products	RMB 9,606	RMB 7,205	75.00	4,885
Sinopec Qingdao Petrochemical Company Limited	Manufacturing of intermediate petrochemical products and petroleum products	RMB 1,595	RMB 7,233	100.00	-
Gaoqiao Petrochemical Company Limited	Manufacturing of intermediate petrochemical products and petroleum products	RMB 10,000	RMB 4,804	55.00	6,829
Sinopec Baling Petrochemical Co. Ltd. ('Baling Petrochemical') (ii)	Crude oil processing and petroleum products manufacturing	RMB 3,00	RMB 3,00	55.00	2,133
(d) Subsidiaries acquired through business combination not under common control:
Shanghai SECCO	Production and sale of petrochemical products	RMB 7,801	RMB 7,801	67.60	5,920

*

The minority interests of subsidiaries which the Group holds 100% of equity interests at the end of the year are the minority interests of their subsidiaries.

(i)

The Group consolidated the financial statements of the entity because it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those return through its power over the entity.

(ii)

See Note 58.

	Marketing Company	SIPL	Shanghai Petrochemical	Fujian Petrochemical	Sinopec Kantons	Shanghai SECCO	Sinopec-SK
	At	At	At	At	At	At	At	At	At	At	At	At	At	At
	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets	172,352	129,266	22,620	19,151	17,305	22,309	1,582	1,788	4,373	1,284	10,431	11,858	3,639	5,337
Current liabilities	(201,678)	(192,106)	(475)	(456)	(15,232)	(15,479)	(458)	(804)	(924)	(2,961)	(2,783)	(3,196)	(6,377)	(15,037)
Net current (liabilities)/assets	(29,326)	(62,840)	22,145	18,695	2,073	6,830	1,124	984	3,449	(1,677)	7,648	8,662	(2,738)	(9,700)
Non-current assets	323,571	340,356	8,951	13,234	27,444	23,327	12,568	11,558	9,106	12,777	12,177	11,473	22,187	21,567
Non-current liabilities	(59,554)	(58,732)	(18,270)	(16,952)	(162)	(141)	(693)	(688)	(170)	(158)	(1,553)	(1,627)	(8,509)	(7)
Net non-current assets/(liabilities)	264,017	281,624	(9,319)	(3,718)	27,282	23,186	11,875	10,870	8,936	12,619	10,624	9,846	13,678	21,560

Year ended 31 December	Marketing Company	SIPL	Shanghai Petrochemical	Fujian Petrochemical	Sinopec Kantons	Shanghai SECCO	Sinopec-SK
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	1,099,680	1,427,705	2,017	3,282	74,705	100,346	4,871	5,535	1,064	1,274	21,626	28,341	28,702	31,016
Profit/(loss) for the year	22,415	22,984	1,160	2,831	639	2,225	243	477	2,047	1,131	2,132	3,137	(920)	664
Total comprehensive income/(loss)	21,149	23,354	(720)	2,693	628	2,233	243	477	1,814	1,140	2,132	3,137	(920)	664
Comprehensive income/(loss) attributable to minority interests	7,205	8,285	(287)	1,651	317	1,112	121	238	707	433	691	1,016	(377)	232
Dividends paid to minority interests	2,766	4,830	316	10,926	649	1,344	150	650	175	159	767	822	-	-
Net cash generated from/(used in) operating activities	54,139	40,260	281	2,128	1,751	5,121	(244)	622	586	716	3,119	4,601	(363)	5,532

(1)

The relevant financial information disclosed for changes in the scope of consolidation are as follows:

Acquiree	Share of acquired equity	The basis for the business combination under the common control	Date of acquisition	Basis of Determination on the acquisition date	Income of the acquiree from 1 January 2020 to the acquisition date	Net profits of the acquiree from 1 January 2020 to the acquisition date	Income of the acquiree from 1 January 2019 to 31 December 2019	Net profits of the acquiree from 1 January 2019 to 31 December 2019	Net cash flow from operating activities of the acquiree from 1 January 2020 to the acquisition date	Net cash flow of the acquiree from 1 January 2020 to the acquisition date
					RMB Million	RMB Million	RMB Million	RMB Million	RMB Million	RMB Million
Baling Branch of SAMC	55%	The acquiree and the company are controlled by Sinopec Group Company both before and after combination, and the control is not transitory	1 November 2020	According to the agreement	10,973	119	16,906	50	1,639	7,205

(2)

Cost of acquisition:

Cost of acquisition (RMB Million)

972

(3)

Details of the assets and liabilities acquired are as follows:

	Book value at	Book value at
	the Acquisition Date	December 31 2019
	RMB Million	RMB Million
Total current assets	2,634	2,097
Total assets	6,633	5,858
Total current liabilities	4,892	4,247
Total liabilities	4,955	4,389
Total shareholders' equity	1,678	1,469

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Authorised and contracted for (i)	171,335	138,088
Authorised but not contracted for	33,942	63,967
Total	205,277	202,055

(i)

The investment commitments of the Group is RMB 13,172 million (2019: RMB 6,100 million).

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Within one year	390	302
Between one and two years	99	69
Between two and three years	66	34
Between three and four years	63	30
Between four and five years	56	29
Thereafter	824	845
Total	1,498	1,309

(a)

The Company has been advised by its PRC lawyers that, except for liabilities constituting or arising out of or relating to the business assumed by the Company in the Reorganisation, no other liabilities were assumed by the Company, and the Company is not jointly and severally liable for other debts and obligations incurred by Sinopec Group Company prior to the Reorganisation.

(b)

At 31 December 2020 and 31 December 2019, the guarantees by the Group in respect of facilities granted to the parties below are as follows:

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Joint ventures	6,390	7,100
Associates (i)	8,450	10,140
Total	14,840	17,240

(i)

The Group provided a guarantee in respect to standby credit facilities granted to Zhongtian Synergetic Energy by banks amount to RMB 17,050 million. At 31 December 2020, the amount withdrawn by Zhongtian Synergetic Energy from banks and guaranteed by the Group was RMB 8,450 million (31 December 2019: RMB 10,140 million).

(i)

Exploration and production - which explores and develops oil fields, produces crude oil and natural gas and sells such products to the refining segment of the Group and external customers.

(ii)

Refining - which processes and purifies crude oil, which is sourced from the exploration and production segment of the Group and external suppliers, and manufactures and sells petroleum products to the chemicals and marketing and distribution segments of the Group and external customers.

(iii)

Marketing and distribution - which owns and operates oil depots and service stations in the PRC, and distributes and sells refined petroleum products (mainly gasoline and diesel) in the PRC through wholesale and retail sales networks.

(iv)

Chemicals - which manufactures and sells petrochemical products, derivative petrochemical products and other chemical products to external customers.

(v)

Corporate and others - which largely comprise the trading activities of the import and export companies of the Group and research and development undertaken by other subsidiaries.

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities

	2020	2019
	RMB million	RMB million
Income from principal operations
Exploration and production
External sales	104,524	111,114
Inter-segment sales	57,513	89,315
	162,037	200,429
Refining
External sales	114,064	141,674
Inter-segment sales	825,812	1,077,018
	939,876	1,218,692
Marketing and distribution
External sales	1,062,447	1,393,557
Inter-segment sales	4,854	4,159
	1,067,301	1,397,716
Chemicals
External sales	322,121	428,830
Inter-segment sales	40,518	78,165
	362,639	506,995
Corporate and others
External sales	458,154	824,507
Inter-segment sales	430,073	654,337
	888,227	1,478,844
Elimination of inter-segment sales	(1,370,624)	(1,902,994)
Consolidated income from principal operations	2,049,456	2,899,682
Income from other operations
Exploration and production	5,718	10,283
Refining	4,634	5,464
Marketing and distribution	34,905	33,247
Chemicals	9,215	9,273
Corporate and others	2,056	1,850
Consolidated income from other operations	56,528	60,117
Consolidated operating income	2,105,984	2,959,799

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities (Continued)

	2020	2019
	RMB million	RMB million
Operating (loss)/profit
By segment
Exploration and production	(20,570)	6,289
Refining	(6,556)	30,074
Marketing and distribution	19,634	29,781
Chemicals	9,147	16,665
Corporate and others	(2,048)	3,530
Elimination	4,417	(40)
Total segment operating profit	4,024	86,299
Investment income
Exploration and production	13,837	3,148
Refining	13,085	(580)
Marketing and distribution	12,230	3,499
Chemicals	1,662	5,178
Corporate and others	6,672	1,383
Total segment investment income	47,486	12,628
Less: Financial expenses	9,506	10,048
Add: Other income	7,513	5,995
(Losses)/gains from changes in fair value	(1,253)	(3,511)
Asset disposal gains/(losses)	2,067	(1,229)
Operating profit	50,331	90,134
Add: Non-operating income	2,370	2,601
Less: Non-operating expenses	4,732	2,624
Profit before taxation	47,969	90,111

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Assets
Segment assets
Exploration and production	354,024	410,950
Refining	270,431	321,080
Marketing and distribution	373,430	399,242
Chemicals	189,678	180,974
Corporate and others	118,458	131,686
Total segment assets	1,306,021	1,443,932
Cash at bank and on hand	184,412	128,052
Long-term equity investments	188,342	152,204
Deferred tax assets	25,054	17,616
Other unallocated assets	29,976	18,482
Total assets	1,733,805	1,760,286
Liabilities
Segment liabilities
Exploration and production	157,430	162,262
Refining	135,046	120,617
Marketing and distribution	213,455	219,381
Chemicals	47,871	57,119
Corporate and others	117,684	136,420
Total segment liabilities	671,486	695,799
Short-term loans	20,756	31,196
Non-current liabilities due within one year	22,493	69,490
Long-term loans	45,459	39,677
Debentures payable	38,356	19,157
Deferred tax liabilities	8,124	6,809
Other non-current liabilities	17,942	15,454
Other unallocated liabilities	25,313	4,330
Total liabilities	849,929	881,912

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities (Continued)

	2020	2019
	RMB million	RMB million
Capital expenditure
Exploration and production	56,416	61,739
Refining	24,722	31,372
Marketing and distribution	25,403	29,566
Chemicals	26,202	22,438
Corporate and others	2,312	1,979
	135,055	147,094
Depreciation, depletion and amortisation
Exploration and production	46,273	50,732
Refining	20,048	19,676
Marketing and distribution	23,196	21,572
Chemicals	14,376	14,326
Corporate and others	3,072	2,866
	106,965	109,172
Impairment losses on long-lived assets
Exploration and production	8,495	3
Refining	1,923	245
Marketing and distribution	536	80
Chemicals	3,606	17
Corporate and others	-	-
	14,560	345

(2)

Geographical information

	2020	2019
	RMB million	RMB million
External sales
Mainland China	1,721,955	2,124,684
Singapore	215,846	505,672
Others	168,183	329,443
	2,105,984	2,959,799

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Non-current assets
Mainland China	1,211,441	1,239,437
Others	36,782	52,705
	1,248,223	1,292,142

‧

credit risk;

‧

liquidity risk; and

‧

market risk.

(i)

Risk management

(ii)

Impairment of financial assets

	At 31 December 2020
	Carrying amount	Total contractual undiscounted cash flow	Within one year or on demand	More than one year but less than two years	More than two years but less than five years	More than five years
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Short-term loans	20,756	20,950	20,950	-	-	-
Derivative financial liabilities	4,826	4,826	4,826	-	-	-
Bills payable	10,394	10,394	10,394	-	-	-
Accounts payable	151,262	151,262	151,262	-	-	-
Other payables and employee benefits payable	91,681	91,681	91,681	-	-	-
Non-current liabilities due within one year	22,493	23,880	23,880	-	-	-
Debentures payable due within one year	3,018	3,024	3,024	-	-	-
Long-term loans	45,459	49,074	936	4,638	41,009	2,491
Debentures payable	38,356	44,791	1,240	8,044	29,514	5,993
Lease liabilities	172,306	313,126	-	15,456	43,513	254,157
Total	560,551	713,008	308,193	28,138	114,036	262,641

	At 31 December 2019
	Carrying amount	Total contractual undiscounted cash flow	Within one year or on demand	More than one year but less than two years	More than two years but less than five years	More than five years
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Short-term loans	31,196	31,633	31,633	-	-	-
Derivative financial liabilities	2,729	2,729	2,729	-	-	-
Bills payable	11,834	11,834	11,834	-	-	-
Accounts payable	188,189	188,189	188,189	-	-	-
Other payables and employee benefits payable	80,183	80,183	80,183	-	-	-
Non-current liabilities due within one year	69,490	72,180	72,180	-	-	-
Long-term loans	39,677	49,656	404	6,492	15,610	27,150
Debentures payable	19,157	24,400	764	764	16,667	6,205
Lease liabilities	177,674	351,223	-	15,676	45,008	290,539
Total	620,129	812,027	387,916	22,932	77,285	323,894

(a)

Currency risk

	At 31 December	At 31 December
	2020	2019
	million	million
Gross exposure arising from loans and lease liabilities
US Dollar	22	103
Singapore Dollar	-	4

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
US Dollar	5	27
Singapore Dollar	-	1

(b)

Interest rate risk

(c)

Commodity price risk

(i)

Financial instruments carried at fair value

‧

Level 1 (highest level): fair values measured using quoted prices (unadjusted) in active markets for identical financial instruments.

‧

Level 2: fair values measured using quoted prices in active markets for similar financial instruments, or using valuation techniques in which all significant inputs are directly or indirectly based on observable market data.

‧

Level 3 (lowest level): fair values measured using valuation techniques in which any significant input is not based on observable market data.

	Level 1	Level 2	Level 3	Total
	RMB million	RMB million	RMB million	RMB million
Assets
Financial assets held for trading:
- Equity investments, listed and at quoted market price	1	-	-	1
Derivative financial assets:
- Derivative financial assets	9,628	2,900	-	12,528
Receivables financing:
- Receivables financing	-	-	8,735	8,735
Other equity instrument investments:
- Other Investments	149	-	1,376	1,525
	9,778	2,900	10,111	22,789
Liabilities
Derivative financial liabilities:
- Derivative financial liabilities	2,471	2,355	-	4,826
	2,471	2,355	-	4,826

	Level 1	Level 2	Level 3	Total
	RMB million	RMB million	RMB million	RMB million
Assets
Financial assets held for trading:
- Structured deposits	-	-	3,318	3,318
- Equity investments, listed and at quoted market price	1	-	-	1
Derivative financial assets:
- Derivative financial assets	128	709	-	837
Receivables financing:
- Receivables financing	-	-	8,661	8,661
Other equity instrument investments:
- Other Investments	90	-	1,431	1,521
	219	709	13,410	14,338
Liabilities
Derivative financial liabilities:
- Derivative financial liabilities	1,209	1,520	-	2,729
	1,209	1,520	-	2,729

(ii)

Fair values of financial instruments carried at other than fair value

	At 31 December	At 31 December
	2020	2019
	RMB million	RMB million
Carrying amount	76,674	63,998
Fair value	74,282	62,646

	2020	2019
	RMB million	RMB million
Extraordinary (gains)/losses for the year:
Net (gains)/losses on disposal of non-current assets	(973)	1,318
Donations	301	209
Government grants	(8,605)	(6,857)
Gain on holding and disposal of business and various investments	(37,520)	(410)
Other non-operating losses, net	2,992	634
	(43,805)	(5,106)
Tax effect	6,611	1,642
Total	(37,194)	(3,464)
Attributable to:
Equity shareholders of the Company	(34,489)	(3,339)
Minority interests	(2,705)	(125)

(i)

Basic earnings per share

	2020	2019
Net profit attributable to equity shareholders of the Company (RMB million)	32,924	57,619
Weighted average number of outstanding ordinary shares of the Company (million)	121,071	121,071
Basic earnings per share (RMB/share)	0.272	0.476

	2020	2019
Weighted average number of outstanding ordinary shares of the Company at 1 January (million)	121,071	121,071
Weighted average number of outstanding ordinary shares of the Company at 31 December (million)	121,071	121,071

(ii)

Diluted earnings per share

	2020	2019
Net profit attributable to equity shareholders of the Company (diluted) (RMB million)	32,924	57,619
Weighted average number of outstanding ordinary shares of the Company (diluted) (million)	121,071	121,071
Diluted earnings per share (RMB/share)	0.272	0.476

	2020	2019
Weighted average number of the ordinary shares issued at 31 December (million)	121,071	121,071
Weighted average number of the ordinary shares issued at 31 December (diluted) (million)	121,071	121,071

	2020	2019
	Weighted average return on net assets	Basic earnings per share	Diluted earnings per share	Weighted average return on net assets	Basic earnings per share	Diluted earnings per share
	(%)	(RMB/Share)	(RMB/Share)	(%)	(RMB/Share)	(RMB/Share)
Net profit attributable to the Company's ordinary equity shareholders	4.44	0.272	0.272	7.90	0.476	0.476
Net profit deducted extraordinary gains and losses attributable to the Company's ordinary equity shareholders	(0.21)	(0.013)	(0.013)	7.44	0.448	0.448

‧	the consolidated balance sheet as at 31 December 2020;

‧	the consolidated income statement for the year then ended;

‧	the consolidated statement of comprehensive income for the year then ended;

‧	the consolidated statement of changes in equity for the year then ended;

‧	the consolidated statement of cash flows for the year then ended; and

‧	the notes to the consolidated financial statements, which include a summary of significant accounting policies.

Key Audit Matter	How our audit addressed the Key Audit Matter
Recoverability of the carrying amount of property, plant and equipment relating to oil and gas producing activities Refer to note 8 'Other operating expense, net', note 17 'Property, plant and equipment' and note 44 'Accounting estimates and judgements' to the consolidated financial statements. Low crude oil prices gave rise to possible indication that the carrying amount of property, plant and equipment relating to oil and gas producing activities as at 31 December 2020 might be impaired. The Group has adopted value in use as the respective recoverable amounts of property, plant and equipment relating to oil and gas producing activities, which involved key estimations or assumptions including: -Future crude oil prices; -Future production profiles; -Future cost profiles; and -Discount rates. Because of the significance of the carrying amount of property, plant and equipment relating to oil and gas producing activities as at 31 December 2020, together with the use of significant estimations or assumptions in determining their respective value in use, we had placed our audit emphasis on this matter.	In auditing the respective value in use calculations of property, plant and equipment relating to oil and gas producing activities, we performed the following key procedures on the relevant discounted cash flow projections prepared by management: ‧ Obtained an understanding of the management's internal control and assessment process of impairment of property, plant and equipment relating to oil and gas producing activities and assessed the inherent risk of material misstatement by considering the degree of estimation uncertainty and level of other inherent risk factors such as complexity, subjectivity, changes and susceptibility to management bias or fraud. ‧ Evaluated and tested the key controls in respect of the preparation of the discounted cash flow projections of property, plant and equipment relating to oil and gas producing activities. ‧ Assessed the methodology adopted in the discounted cash flow projections, tested mathematical accuracy of the projections, and the completeness, accuracy, and relevance of underlying data used in the projections. ‧ Compared estimates of future crude oil prices adopted by the Group against a range of published crude oil price forecasts. ‧ Compared the future production profiles against the oil and gas reserve estimation report approved by the management. Evaluated the competence, capability and objectivity of the management's experts engaged in estimating the oil and gas reserves. Assessed key estimations or assumptions used in the reserve estimation, by reference to historical data, management plans and/or relevant external data. ‧ Compared the future cost profiles against historical costs and relevant budgets of the Group. ‧ Tested selected other key data inputs, such as natural gas prices and production profiles in the projections by reference to historical data and/or relevant budgets of the Group. ‧ Used professionals with specialized skill and knowledge to assist in the evaluation of the appropriateness of discount rates adopted by the management. ‧ Evaluated the sensitivity analyses prepared by the Group, and assessed the potential impacts of a range of possible outcomes. Based on our work, we found the key assumptions and input data adopted were supported by the evidence we obtained.

‧

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

‧	Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.

‧	Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

‧

Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.

‧	Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

‧

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

	Note	Year ended 31 December
		2020	2019
		RMB	RMB
Turnover and other operating revenues
Turnover	3	2,049,456	2,899,682
Other operating revenues	4	56,528	60,117
		2,105,984	2,959,799
Operating expenses
Purchased crude oil, products and operating supplies and expenses		(1,594,130)	(2,370,699)
Selling, general and administrative expenses	5	(55,315)	(55,438)
Depreciation, depletion and amortisation		(106,965)	(109,172)
Exploration expenses, including dry holes		(9,716)	(10,510)
Personnel expenses	6	(86,006)	(82,743)
Taxes other than income tax	7	(234,947)	(244,517)
Other operating expense, net	8	(5,712)	(346)
Total operating expenses		(2,092,791)	(2,873,425)
Operating profit		13,193	86,374
Finance costs
Interest expense	9	(15,194)	(17,088)
Interest income		4,803	7,210
Foreign currency exchange gains/(losses), net		885	(170)
Net finance costs		(9,506)	(10,048)
Investment income	10	37,744	919
Share of profits less losses from associates and joint ventures	21,22	6,712	12,777
Profit before taxation		48,143	90,022
Income tax expense	11	(6,219)	(17,939)
Profit for the year		41,924	72,083
Attributable to:
Shareholders of the Company		33,096	57,493
Non-controlling interests		8,828	14,590
Profit for the year		41,924	72,083
Earnings per share:
Basic	16	0.273	0.475
Diluted	16	0.273	0.475

	Note	Year ended 31 December
		2020	2019
		RMB	RMB
Profit for the year		41,924	72,083
Other comprehensive income:	15
Items that may not be reclassified subsequently to profit or loss
Equity investments at fair value through other comprehensive income		(22)	(31)
Total items that may not be reclassified subsequently to profit or loss		(22)	(31)
Items that may be reclassified subsequently to profit or loss
Fair value hedges		162	-
Share of other comprehensive loss of associates and joint ventures		(2,441)	(810)
Cash flow hedges		7,073	4,941
Foreign currency translation differences		(4,457)	1,480
Total items that may be reclassified subsequently to profit or loss		337	5,611
Total other comprehensive income		315	5,580
Total comprehensive income for the year		42,239	77,663
Attributable to:
Shareholders of the Company		34,490	62,908
Non-controlling interests		7,749	14,755
Total comprehensive income for the year		42,239	77,663

	Note	31 December	31 December
		2020	2019
		RMB	RMB
Non-current assets
Property, plant and equipment, net	17	589,247	625,692
Construction in progress	18	124,765	173,872
Right-of-use assets	19	266,368	267,937
Goodwill	20	8,620	8,697
Interest in associates	21	136,163	95,737
Interest in joint ventures	22	52,179	56,467
Financial assets at fair value through other comprehensive income	26	1,525	1,521
Deferred tax assets	29	25,054	17,616
Long-term prepayments and other assets	23	74,489	65,437
Total non-current assets		1,278,410	1,312,976
Current assets
Cash and cash equivalents		87,559	60,438
Time deposits with financial institutions		100,498	67,614
Financial assets at fair value through profit or loss		1	3,319
Derivative financial assets	24	12,528	837
Trade accounts receivable	25	35,587	54,375
Financial assets at fair value through other comprehensive income	26	8,735	8,661
Inventories	27	151,895	194,142
Prepaid expenses and other current assets	28	58,592	57,924
Total current assets		455,395	447,310
Current liabilities
Short-term debts	30	23,769	40,521
Loans from Sinopec Group Company and fellow subsidiaries	30	5,264	43,289
Lease liabilities	31	15,292	15,198
Derivative financial liabilities	24	4,826	2,729
Trade accounts payable and bills payable	32	161,656	200,023
Contract liabilities	33	126,160	126,833
Other payables	34	178,637	148,118
Income tax payable		6,586	3,267
Total current liabilities		522,190	579,978
Net current liabilities		66,795	132,668
Total assets less current liabilities		1,211,615	1,180,308
Non-current liabilities
Long-term debts	30	72,037	49,208
Loans from Sinopec Group Company and fellow subsidiaries	30	11,778	9,626
Lease liabilities	31	172,306	177,674
Deferred tax liabilities	29	8,124	6,809
Provisions	35	45,552	43,163
Other long-term liabilities		18,960	16,524
Total non-current liabilities		328,757	303,004
		882,858	877,304
Equity
Share capital	36	121,071	121,071
Reserves		620,423	617,875
Total equity attributable to shareholders of the Company		741,494	738,946
Non-controlling interests		141,364	138,358
Total equity		882,858	877,304

Zhang Yuzhuo	Ma Yongsheng	Shou Donghua
Chairman	President	Chief Financial Officer
(Legal representative)

	Share capital	Capital reserve	Share premium	Statutory surplus reserve	Discretionary surplus reserve	Other reserves	Retained earnings	Total equity attributable to shareholders of the Company	Non- controlling interests	Total equity
	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB
Balance at 31 December 2018	121,071	26,053	55,850	86,678	117,000	(4,477)	315,109	717,284	139,251	856,535
Contribution from SAMC in the Acquisition of Baling Branch of SAMC (Note 38)	-	735	-	-	-	-	58	793	670	1,463
Balance at 1 January 2019	121,071	26,788	55,850	86,678	117,000	(4,477)	315,167	718,077	139,921	857,998
Profit for the year	-	-	-	-	-	-	57,493	57,493	14,590	72,083
Other comprehensive income (Note 15)	-	-	-	-	-	5,415	-	5,415	165	5,580
Total comprehensive income for the year	-	-	-	-	-	5,415	57,493	62,908	14,755	77,663
Amounts transferred to initial carrying amount of hedged items	-	-	-	-	-	1,038	-	1,038	55	1,093
Transactions with owners, recorded directly in equity:
Contributions by and distributions to owners:
Final dividend for 2018 (Note 14)	-	-	-	-	-	-	(31,479)	(31,479)	-	(31,479)
Interim dividend for 2019 (Note 14)	-	-	-	-	-	-	(14,529)	(14,529)	-	(14,529)
Appropriation (Note (a))	-	-	-	3,745	-	-	(3,745)	-	-	-
Distributions to non-controlling interests	-	-	-	-	-	-	-	-	(18,989)	(18,989)
Contributions to subsidiaries from non-controlling interests	-	-	-	-	-	-	-	-	5,495	5,495
Total contributions by and distributions to owners	-	-	-	3,745	-	-	(49,753)	(46,008)	(13,494)	(59,502)
Transaction with non-controlling interests	-	2,933	-	-	-	-	-	2,933	(2,933)	-
Total transactions with owners	-	2,933	-	3,745	-	-	(49,753)	(43,075)	(16,427)	(59,502)
Others	-	9	-	-	-	(35)	24	(2)	54	52
Balance at 31 December 2019	121,071	29,730	55,850	90,423	117,000	1,941	322,931	738,946	138,358	877,304

	Share capital	Capital reserve	Share premium	Statutory surplus reserve	Discretionary surplus reserve	Other reserves	Retained earnings	Total equity attributable to shareholders of the Company	Non- controlling interests	Total equity
	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB	RMB
Balance at 1 January 2020	121,071	29,730	55,850	90,423	117,000	1,941	322,931	738,946	138,358	877,304
Profit for the year	-	-	-	-	-	-	33,096	33,096	8,828	41,924
Other comprehensive income (Note 15)	-	-	-	-	-	1,406	(12)	1,394	(1,079)	315
Total comprehensive income for the year	-	-	-	-	-	1,406	33,084	34,490	7,749	42,239
Amounts transferred to initial carrying amount of hedged items	-	-	-	-	-	(47)	-	(47)	48	1
Transactions with owners, recorded directly in equity:
Contributions by and distributions to owners:
Final dividend for 2019 (Note 14)	-	-	-	-	-	-	(23,004)	(23,004)	-	(23,004)
Interim dividend for 2020 (Note 14)	-	-	-	-	-	-	(8,475)	(8,475)	-	(8,475)
Appropriation (Note (a))	-	-	-	1,857	-	-	(1,857)	-	-	-
Distributions to non-controlling interests	-	-	-	-	-	-	-	-	(6,726)	(6,726)
Contributions to subsidiaries from non-controlling interests	-	-	-	-	-	-	-	-	3,325	3,325
Distribution to SAMC in the Acquisition of Baling Branch of SAMC (Note 38)	-	(972)	-	-	-	-	-	(972)	972	-
Total contributions by and distributions to owners	-	(972)	-	1,857	-	-	(33,336)	(32,451)	(2,429)	(34,880)
Transaction with non-controlling interests	-	(138)	-	-	-	-	-	(138)	13	(125)
Total transactions with owners	-	(1,110)	-	1,857	-	-	(33,336)	(32,589)	(2,416)	(35,005)
Others	-	812	-	-	-	200	(318)	694	(2,375)	(1,681)
Balance at 31 December 2020	121,071	29,432	55,850	92,280	117,000	3,500	322,361	741,494	141,364	882,858

(a)

According to the PRC Company Law and the Articles of Association of the Company, the Company is required to transfer 10% of its net profit determined in accordance with the accounting policies complying with Accounting Standards for Business Enterprises ('CASs'), adopted by the Group to statutory surplus reserve. In the event that the reserve balance reaches 50% of the registered capital, no transfer is required. The transfer to this reserve must be made before distribution of a dividend to shareholders. Statutory surplus reserve can be used to make good previous years' losses, if any, and may be converted into share capital by issuing of new shares to shareholders in proportion to their existing shareholdings or by increasing the par value of the shares currently held by them, provided that the balance after such issue is not less than 25% of the registered capital.

(b)	The usage of the discretionary surplus reserve is similar to that of statutory surplus reserve.

(c)

As at 31 December 2020, the amount of retained earnings available for distribution was RMB 115,849 million (2019: RMB 130,645 million), being the amount determined in accordance with CASs. According to the Articles of Association of the Company, the amount of retained earnings available for distribution to shareholders of the Company is lower of the amount determined in accordance with the accounting policies complying with CASs and the amount determined in accordance with the accounting policies complying with International Financial Reporting Standards ('IFRS').

(d)

The capital reserve represents (i) the difference between the total amount of the par value of shares issued and the amount of the net assets transferred from Sinopec Group Company in connection with the Reorganisation (Note 1); and (ii) the difference between the considerations paid over or received the amount of the net assets of entities and related operations acquired from or sold to Sinopec Group Company and non-controlling interests.

(e)	The application of the share premium account is governed by Sections 167 and 168 of the PRC Company Law.

	Note	Year ended 31 December
		2020	2019
		RMB	RMB
Net cash generated from operating activities	(a)	167,518	153,619
Investing activities
Capital expenditure		(117,874)	(130,057)
Exploratory wells expenditure		(13,315)	(11,497)
Purchase of investments, investments in associates and investments in joint ventures		(6,040)	(3,483)
Payment for financial assets at fair value through profit or loss		(6,700)	(12,851)
Proceeds from sale of financial assets at fair value through profit or loss		10,000	35,292
Payment for acquisition of subsidiary, net of cash acquired		(340)	(1,031)
Proceeds from disposal of investments and investments in associates		51,520	704
Proceeds from disposal of property, plant, equipment and other non-current assets		2,656	709
Increase in time deposits with maturities over three months		(84,689)	(103,231)
Decrease in time deposits with maturities over three months		54,950	90,710
Interest received		2,305	7,094
Investment and dividend income received		11,510	10,272
Repayments of other investing activities		(6,186)	(3,682)
Net cash used in investing activities		(102,203)	(121,051)
Financing activities
Proceeds from bank and other loans		558,680	602,467
Repayments of bank and other loans		(540,015)	(614,108)
Contributions to subsidiaries from non-controlling interests		4,219	3,919
Dividends paid by the Company		(31,479)	(46,008)
Distributions by subsidiaries to non-controlling interests		(4,157)	(7,357)
Interest paid		(7,508)	(6,250)
Payments made to acquire non-controlling interests		(1,121)	(8)
Repayments of lease liabilities		(15,327)	(16,859)
Proceeds from other financing activities		514	320
Repayments of other financing activities		(761)	(320)
Net cash used in financing activities		(36,955)	(84,204)
Net increase/(decrease) in cash and cash equivalents		28,360	(51,636)
Cash and cash equivalents at 1 January		60,438	111,927
Effect of foreign currency exchange rate changes		(1,239)	147
Cash and cash equivalents at 31 December		87,559	60,438

	Year ended 31 December
	2020	2019
	RMB	RMB
Operating activities
Profit before taxation	48,143	90,022
Adjustments for:
Depreciation, depletion and amortisation	106,965	109,172
Dry hole costs written off	5,928	5,831
Share of profits from associates and joint ventures	(6,712)	(12,777)
Investment income	(37,744)	(919)
Interest income	(3,433)	(7,210)
Interest expense	14,449	17,088
Loss on foreign currency exchange rate changes and derivative financial instruments	2,003	3,624
(Gain)/loss on disposal of property, plant, equipment and other non-current assets, net	(398)	1,829
Impairment losses on assets	26,018	1,779
Credit impairment losses	2,066	1,264
	157,285	209,703
Net changes from:
Accounts receivable and other current assets	(17,623)	(11,915)
Inventories	22,703	(9,748)
Accounts payable and other current liabilities	14,175	(14,898)
	176,540	173,142
Income tax paid	(9,022)	(19,523)
Net cash generated from operating activities	167,518	153,619

(a)

New and amended standards and interpretations adopted by the Group

(b)

New and amended standards and interpretations not yet adopted by the Group

(a)

Basis of consolidation

(i)

Subsidiaries and non-controlling interests

(ii)

Associates and joint ventures

(a)

Basis of consolidation (Continued)

(iii)

Transactions eliminated on consolidation

(iv)

Merger accounting for common control combination

(b)

Translation of foreign currencies

(c)

Cash and cash equivalents

(d)

Trade, bills and other receivables

(e)

Inventories

(f)

Property, plant and equipment

	Estimated usage period	Estimated residuals rate
Buildings	12 to 50 years	3%
Equipment, machinery and others	4 to 30 years	3%

(g)

Oil and gas properties

(h)

Construction in progress

(i)

Goodwill

(j)

Financial assets

(i)

Classification and measurement

•

Amortised cost: The business model for managing such financial assets by the Group are held for collection of contractual cash flows. The contractual cash flow characteristics are to give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Interest income from these financial assets is recognised using the effective interest rate method.

•

FVOCI: The business model for managing such financial assets by the Group are held for collection of contractual cash flows and for selling the financial assets, where the assets' cash flows represent solely payments of principal and interest on the principal amount outstanding. Movements in the carrying amount are taken through other comprehensive income, except for the recognition of impairment gains or losses, foreign exchange gains and losses and interest income calculated using the effective interest rate method, which are recognised in profit or loss.

(ii)

Impairment

(j)

Financial assets (Continued)

(iii)

Derecognition

(k)

Financial liabilities

(l)

Determination of fair value for financial instruments

(m)

Derivative financial instruments and hedge accounting

(i)

There is an economic relationship between the hedged item and the hedging instrument, which shares a risk and that gives rise to opposite changes in fair value that tend to offset each other.

(ii)

The effect of credit risk does not dominate the value changes that result from that economic relationship.

(iii)

The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the entity actually hedges and the quantity of the hedging instrument that the entity actually uses to hedge that quantity of hedged item. However, that designation does not reflect an imbalance between the weightings of the hedged item and the hedging instrument.

(m)

Derivative financial instruments and hedge accounting (Continued)

(i)

The cumulative gain or loss on the hedging instrument from inception of the hedge; and

(ii)

The cumulative change in fair value (present value) of the hedged item (i.e. the present value of the cumulative change in the hedged expected future cash flows) from inception of the hedge.

(n)

Impairment of assets

(o)

Trade, bills and other payables

(p)

Interest-bearing borrowings

(q)

Provisions and contingent liability

(r)

Revenue recognition

(s)

Government grants

(t)

Borrowing costs

(u)

Repairs and maintenance expenditure

(v)

Environmental expenditures

(w)

Research and development expense

(x)

Leases

(i)

As lessee

(ii)

As lessor

(y)

Employee benefits

(z)

Income tax

(aa)

Dividends

(bb)

Segment reporting

	2020	2019
	RMB million	RMB million
Gasoline	557,605	699,202
Diesel	422,569	615,342
Crude oil	351,707	549,720
Basic chemical feedstock	155,687	215,773
Synthetic resin	122,313	125,658
Kerosene	72,385	191,636
Natural gas	48,121	53,839
Synthetic fiber monomers and polymers	41,640	80,100
Others (i)	277,429	368,412
	2,049,456	2,899,682

(i)

Others are primarily liquefied petroleum gas and other refinery and chemical byproducts and joint products.

	2020	2019
	RMB million	RMB million
Sale of materials and others	55,441	58,886
Rental income	1,087	1,231
	56,528	60,117

	2020	2019
	RMB million	RMB million
Operating lease charges	2,685	1,858
Auditor's remuneration:
- Audit services	73	70
- Others	8	6
Impairment losses:
- Trade accounts receivable	2,105	1,283
- Other receivables	(25)	(2)

	2020	2019
	RMB million	RMB million
Salaries, wages and other benefits	77,202	70,921
Contributions to retirement schemes (Note 40)	8,804	11,822
	86,006	82,743

	2020	2019
	RMB million	RMB million
Consumption tax (i)	197,542	204,388
City construction tax (ii)	15,699	16,387
Education surcharge	11,670	12,111
Resources tax	4,572	5,883
Others	5,464	5,748
	234,947	244,517

(i)

Consumption tax was levied based on sales quantities of taxable products, tax rate of products is presented as below:

Products	Effective from 13 January 2015
	RMB/Ton
Gasoline	2,109.76
Diesel	1,411.20
Naphtha	2,105.20
Solvent oil	1,948.64
Lubricant oil	1,711.52
Fuel oil	1,218.00
Jet fuel oil	1,495.20

(ii)

City construction tax is levied on an entity based on its total paid amount of value-added tax and consumption tax.

	2020	2019
	RMB million	RMB million
Government grants (i)	8,775	6,933
Ineffective portion of change in fair value of cash flow hedges	3,052	(222)
Net realised and unrealised loss on derivative financial instruments not qualified as hedging	(1,252)	(4,384)
Impairment losses on long-lived assets (ii)	(14,560)	(345)
Gain/(loss) on disposal of property, plant, equipment and other non-current assets, net	398	(1,829)
Fines, penalties and compensations	(43)	(173)
Donations	(301)	(210)
Others	(1,781)	(116)
	(5,712)	(346)

(i)

Government grants for the years ended 31 December 2020 and 2019 primarily represent financial appropriation income and non-income tax refunds received from respective government agencies without conditions or other contingencies attached to the receipts of the grants.

(ii)

Impairment losses on long-lived assets for the year ended 31 December 2020 primarily represent impairment losses recognised in the exploration and production ('E&P') segment of RMB 8,495 million (2019: RMB 3 million), the chemicals segment of RMB 3,606 million (2019: RMB 17 million), the refining segment of RMB 1,923 million (2019: RMB 245 million), and the marketing and distribution segment of RMB 536 million (2019: RMB 80 million). The impairment losses in the E&P segment were mainly the impairment losses of properties, plant and equipment relating to oil and gas producing activities. The primary factors resulting in the E&P segment impairment loss were low oil price outlook and downward revision of oil and gas reserve in certain fields. E&P segment determines recoverable amounts of properties, plant and equipment relating to oil and gas producing activities, which include significant judgments and assumptions. The recoverable amounts were determined based on the present values of the expected future cash flows of the assets using a pre-tax discount rate 10.47% (2019: 10.47%). Further future downward revisions to the Group's oil price outlook would lead to further impairments which, in aggregate, are likely to be material. It is estimated that a general decrease of 5% in oil price, with all other variables held constant, would result in additional impairment loss on the Group's properties, plant and equipment relating to oil and gas producing activities by approximately RMB 4,548 million (2019: RMB 184 million). It is estimated that a general increase of 5% in operating cost, with all other variables held constant, would result in additional impairment loss on the Group's properties, plant and equipment relating to oil and gas producing activities by approximately RMB 2,836 million (2019: RMB 180 million). It is estimated that a general increase of 5% in discount rate, with all other variables held constant, would result in additional impairment loss on the Group's properties, plant and equipment relating to oil and gas producing activities by approximately RMB 287 million (2019: RMB 7 million).The assets in the chemicals segment were written down because evidence indicates the economic performance of certain production facilities are worse than expected.

	2020	2019
	RMB million	RMB million
Interest expense incurred	6,513	7,039
Less: Interest expense capitalised*	(2,011)	(1,015)
	4,502	6,024
Interest expense on lease liabilities	9,349	9,646
Accretion expenses (Note 35)	1,343	1,418
Interest expense	15,194	17,088
* Interest rates per annum at which borrowing costs were capitalised for construction in progress	2.60% to 4.66%	2.92% to 4.66%

	2020	2019
	RMB million	RMB million
Investment income from disposal of business and long-term equity investments (i)	37,525	185
Dividend income from holding of other equity instrument investments	156	492
Others	63	242
	37,744	919

(i)

The Company and Sinomart KTS Development Limited, Sinopec Natural Gas Limited Company and Sinopec Marketing Company Limited ('Marketing Company'), the subsidiaries of the Company entered into the Agreement on Cash Payment to Purchase Equity in Sinopec Yu Ji Pipeline Company Limited, the Agreement on Additional Issuance of Equity and Cash Payment to Purchase Assets, the Agreement on Cash Payment to Purchase Assets and the Agreement on Additional Issuance of Equity to Purchase Assets with China Oil & Gas Pipeline Network Corporation ('PipeChina'), on 21 July 2020 and on 23 July 2020 respectively, pursuant to which the Company and its subsidiaries proposed to dispose target business, including equity interests in the relevant companies, oil and gas pipeline and ancillary facilities, to PipeChina. The above transactions were considered and approved by the 15th Session of 7th Directorate Meeting on 23 July 2020 and the second Extraordinary General Meeting on 28 September 2020. The transaction consideration was mainly additional issuance of equity and/or cash payment by PipeChina and the gain on above transactions was RMB 37,731 million. Main assets and liabilities of disposed target business are as follows:

	30 September 2020
	RMB million
Property, plant and equipment, net	83,510
Construction in progress	19,843
Interest in associates	26,412
Inventories	8,191
Long-term debts and Loans from Sinopec Group Company and fellow subsidiaries	(41,800)
Other financial statement items	(9,035)
Net Assets	87,121

	2020	2019
	RMB million	RMB million
Current tax
- Provision for the year	14,209	15,021
- Adjustment of prior years	(117)	(467)
Deferred taxation (Note 29)	(7,873)	3,385
	6,219	17,939

	2020	2019
	RMB million	RMB million
Profit before taxation	48,143	90,022
Expected PRC income tax expense at a statutory tax rate of 25%	12,036	22,506
Tax effect of non-deductible expenses	3,274	2,321
Tax effect of non-taxable income (i)	(8,330)	(4,458)
Tax effect of preferential tax rate (ii)	(1,011)	(2,003)
Effect of income taxes at foreign operations	(730)	(312)
Tax effect of utilisation of previously unrecognised tax losses and temporary differences	(65)	(335)
Tax effect of tax losses not recognised	1,087	498
Write-down of deferred tax assets	75	189
Adjustment of prior years	(117)	(467)
Actual income tax expense	6,219	17,939

(i)

For the year ended 31 December 2020, the tax effect of non-taxable income includes the tax exempt investment income of joint ventures and associates and the tax exempt part of the gain related to the disposal of oil and gas pipeline and ancillary facilities.

(ii)

The provision for PRC current income tax is based on a statutory income tax rate of 25% of the assessable income of the Group as determined in accordance with the relevant income tax rules and regulations of the PRC, except for certain entities of the Group in western regions in the PRC are taxed at preferential income tax rate of 15% through the year 2020. According to Announcement [2020] No. 23 of the MOF 'Announcement of the MOF, the State Taxation Administration and the National Development and Reform Commission on continuation of the income tax policy of western development enterprises', the preferential tax rate of 15% extends from 1 January 2021 to 31 December 2030.

(a)

Directors' and supervisors' emoluments

	Emoluments paid or receivable in respect of director's other services in connection with the management of the affairs of the Company or its subsidiary undertaking	Emoluments paid or receivable in respect of a person's services as a director, whether of the Company or its subsidiary undertaking
	2020
Name	Salaries, allowances and benefits in kind	Bonuses	Retirement scheme contributions	Directors'/ Supervisors' fee	Total
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Directors
Zhang Yuzhuo (i)	-	-	-	-	-
Ma Yongsheng	299	620	94	-	1,013
Yu Baocai	-	-	-	-	-
Liu Hongbin (ii)	-	-	-	-	-
Ling Yiqun	-	-	-	-	-
Zhang Shaofeng (iii)	-	-	-	-	-
Dai Houliang (iv)	-	-	-	-	-
Li Yunpeng (v)	-	-	-	-	-
Li Yong (vi)	-	-	-	-	-
Independent non-executive directors
Tang Min	-	-	-	350	350
Cai Hongbin	-	-	-	350	350
Johnny Karling Ng	-	-	-	350	350
Fan Gang (vii)	-	-	-	-	-
Supervisors
Zhao Dong	-	-	-	-	-
Jiang Zhenying	366	710	83	-	1,159
Zou Huiping	272	555	59	-	886
Sun Huanquan (viii)	247	160	60	-	467
Yu Renming	-	-	-	-	-
Li Defang (viii)	-	-	-	-	-
Yu Xizhi (ix)	125	613	23	-	761
Zhou Hengyou (ix)	125	611	23	-	759
Yang Changjiang (x)	-	-	-	-	-
Zhang Baolong (x)	-	-	-	-	-
Total	1,434	3,269	342	1,050	6,095

(a)

Directors' and supervisors' emoluments (Continued)

	Emoluments paid or receivable in respect of director's other services in connection with the management of the affairs of the Company or its subsidiary undertaking	Emoluments paid or receivable in respect of a person's services as a director, whether of the Company or its subsidiary undertaking
	2019
Name	Salaries, allowances and benefits in kind	Bonuses	Retirement scheme contributions	Directors'/ Supervisors' fee	Total
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Directors
Dai Houliang (iv)	-	-	-	-	-
Ma Yongsheng	294	1,173	96	-	1,563
Li Yunpeng (v)	-	-	-	-	-
Yu Baocai	-	-	-	-	-
Ling Yiqun	-	-	-	-	-
Liu Zhongyun (xi)	-	-	-	-	-
Li Yong (vi)	-	-	-	-	-
Independent non-executive directors
Tang Min	-	-	-	350	350
Fan Gang (vii)	-	-	-	350	350
Cai Hongbin	-	-	-	350	350
Johnny Karling Ng	-	-	-	350	350
Supervisors
Zhao Dong	-	-	-	-	-
Jiang Zhenying	369	865	88	-	1,322
Yang Changjiang (x)	-	-	-	-	-
Zhang Baolong (x)	-	-	-	-	-
Zou Huiping	369	989	88	-	1,446
Yu Xizhi (ix)	369	880	88	-	1,337
Zhou Hengyou (ix)	369	874	88	-	1,331
Yu Renming	369	889	88	-	1,346
Total	2,139	5,670	536	1,400	9,745

(i)

Mr. Zhang Yuzhuo was elected to be chairman and non-executive director from 25 March 2020.

(ii)

Mr. Liu Hongbin was elected to be executive director from 19 May 2020.

(iii)

Mr. Zhang Shaofeng was elected to be non-executive director from 28 September 2020.

(iv)

Mr. Dai Houliang ceased being chairman and non-executive director from 19 January 2020.

(v)

Mr. Li Yunpeng ceased being non-executive director from 24 March 2020.

(vi)

Mr. Li Yong ceased being non-executive director from 22 September 2020.

(vii)

Mr. Fan Gang ceased being independent non-executive director from 28 August 2020.

(viii)

Mr. Sun Huanquan was elected to be supervisor from 18 May 2020; Mr. Li Defang was elected to be supervisor from 18 May 2020.

(ix)

Mr. Yu Xizhi ceased being supervisor from 18 May 2020; Mr. Zhou Hengyou ceased being supervisor from 18 May 2020.

(x)

Mr. Yang Changjiang ceased being supervisor from 9 September 2020; Mr. Zhang Baolong ceased being supervisor from 9 September 2020.

(xi)

Due to change of working arrangement, Mr. Liu Zhongyun has tendered his resignation as executive director, member of Strategy Committee of the Board and Senior Vice President of the Company from 9 December 2019.

	Number of individuals
	2020	2019
Emoluments
HKD1,000,001 to HKD1,500,000	3	-
HKD1,500,001 to HKD2,000,000	2	5

	2020	2019
	RMB million	RMB million
Dividends declared and paid during the year of RMB 0.07 per share (2019: RMB 0.12 per share)	8,475	14,529
Dividends declared after the balance sheet date of RMB 0.13 per share (2019: RMB 0.19 per share)	15,739	23,004
	24,214	37,533

	2020	2019
	RMB million	RMB million
Final cash dividends in respect of the previous financial year, approved during the year of RMB 0.19 per share (2019: RMB 0.26 per share)	23,004	31,479

	2020	2019
	Before tax	Tax	Net of tax	Before tax	Tax	Net of tax
	amount	effect	amount	amount	effect	amount
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Cash flow hedges:
Effective portion of changes in fair value of hedging instruments recognised during the year	9,207	(2,295)	6,912	5,258	(974)	4,284
Reclassification adjustments for amounts transferred to the consolidated income statement	198	(37)	161	853	(196)	657
Net movement during the year recognised in other comprehensive income (i)	9,405	(2,332)	7,073	6,111	(1,170)	4,941
Changes in the fair value of instruments at fair value through other comprehensive income	(6)	(4)	(10)	(39)	8	(31)
Transfer of loss on disposal of equity investments at fair value through other comprehensive income to retained earnings	(12)	-	(12)	-	-	-
Net movement during the year recognised in other comprehensive income	(18)	(4)	(22)	(39)	8	(31)
Fair value hedges	162	-	162	-	-	-
Share of other comprehensive loss of associates and joint ventures	(2,441)	-	(2,441)	(810)	-	(810)
Foreign currency translation differences	(4,457)	-	(4,457)	1,480	-	1,480
Other comprehensive income	2,651	(2,336)	315	6,742	(1,162)	5,580

(i)

As at 31 December 2020, cash flow hedge reserve amounted to a gain of RMB 8,176 million (31 December 2019: a gain of RMB 1,102 million), of which a gain of RMB 7,805 million was attributable to shareholders of the Company (31 December 2019: a gain of RMB 1,037 million).

(i)

Profit attributable to ordinary shareholders of the Company (diluted)

	2020	2019
	RMB million	RMB million
Profit attributable to ordinary shareholders of the Company	33,096	57,493
Profit attributable to ordinary shareholders of the Company (diluted)	33,096	57,493

(ii)

Weighted average number of shares (diluted)

	2020	2019
	Number of shares	Number of shares
Weighted average number of shares at 31 December	121,071,209,646	121,071,209,646
Weighted average number of shares (diluted) at 31 December	121,071,209,646	121,071,209,646

			Equipment,
	Plants and	Oil and gas,	machinery
	buildings	properties	and others	Total
	RMB million	RMB million	RMB million	RMB million
Cost:
Balance at 1 January 2019	123,946	695,724	973,688	1,793,358
Additions	159	1,408	3,993	5,560
Transferred from construction in progress	6,261	31,378	54,684	92,323
Reclassifications	1,051	(76)	(975)	-
Invest into the joint ventures and associated companies	(8)	-	(303)	(311)
Reclassification to other long-term assets	(748)	-	(729)	(1,477)
Disposals	(469)	(1,549)	(13,635)	(15,653)
Exchange adjustments	42	667	71	780
Balance at 31 December 2019	130,234	727,552	1,016,794	1,874,580
Balance at 1 January 2020	130,234	727,552	1,016,794	1,874,580
Additions	390	1,563	5,147	7,100
Transferred from construction in progress	10,848	32,214	98,095	141,157
Reclassifications	1,443	(125)	(1,318)	-
Invest into the joint ventures and associated companies	-	-	(115)	(115)
Reclassification to other long-term assets	(38)	-	(1,052)	(1,090)
Disposals (i)	(6,291)	(806)	(131,231)	(138,328)
Exchange adjustments	(141)	(2,806)	(226)	(3,173)
Balance at 31 December 2020	136,445	757,592	986,094	1,880,131
Accumulated depreciation:
Balance at 1 January 2019	56,242	550,288	565,830	1,172,360
Depreciation for the year	4,144	36,289	47,902	88,335
Impairment losses for the year	11	-	185	196
Reclassifications	292	(46)	(246)	-
Invest into the joint ventures and associated companies	-	-	(216)	(216)
Reclassification to other long-term assets	3	-	(94)	(91)
Written back on disposals	(854)	(6)	(11,564)	(12,424)
Exchange adjustments	21	667	40	728
Balance at 31 December 2019	59,859	587,192	601,837	1,248,888
Balance at 1 January 2020	59,859	587,192	601,837	1,248,888
Depreciation for the year	4,628	32,054	48,380	85,062
Impairment losses for the year	683	4,739	6,292	11,714
Reclassifications	393	(98)	(295)	-
Invest into the joint ventures and associated companies	-	-	(54)	(54)
Reclassification to other long-term assets	(8)	-	(161)	(169)
Written back on disposals (i)	(3,209)	(464)	(47,994)	(51,667)
Exchange adjustments	(49)	(2,703)	(138)	(2,890)
Balance at 31 December 2020	62,297	620,720	607,867	1,290,884
Net book value:
Balance at 1 January 2019	67,704	145,436	407,858	620,998
Balance at 31 December 2019	70,375	140,360	414,957	625,692
Balance at 31 December 2020	74,148	136,872	378,227	589,247

(i)

Disposals for the year ended 31 December 2020 mainly due to the Company and its subsidiaries disposed their oil and gas pipeline and ancillary facilities to PipeChina.

	2020	2019
	RMB million	RMB million
Balance at 1 January	173,872	137,449
Additions	130,283	144,751
Dry hole costs written off	(5,928)	(5,831)
Transferred to property, plant and equipment	(141,157)	(92,323)
Reclassification to other long-term assets	(11,464)	(10,086)
Impairment losses for the year	(844)	(135)
Disposals and others	(19,944)	46
Exchange adjustments	(53)	1
Balance at 31 December	124,765	173,872

	Land	Others	Total
	RMB million	RMB million	RMB million
Cost
Balance at 1 January 2019	244,595	27,381	271,976
Additions	8,737	7,555	16,292
Decreases	(4,766)	(748)	(5,514)
Balance at 31 December 2019	248,566	34,188	282,754
Balance at 1 January 2020	248,566	34,188	282,754
Additions	13,983	10,222	24,205
Decreases	(9,405)	(3,142)	(12,547)
Balance at 31 December 2020	253,144	41,268	294,412
Accumulated depreciation
Balance at 1 January 2019	-	-	-
Additions	9,246	5,728	14,974
Decreases	(131)	(26)	(157)
Balance at 31 December 2019	9,115	5,702	14,817
Balance at 1 January 2020	9,115	5,702	14,817
Additions	9,247	6,354	15,601
Decreases	(799)	(1,575)	(2,374)
Balance at 31 December 2020	17,563	10,481	28,044
Impairment loss
Balance at 1 January 2019	-	-	-
Additions	-	-	-
Decreases	-	-	-
Balance at 31 December 2019	-	-	-
Balance at 1 January 2020	-	-	-
Additions	-	-	-
Decreases	-	-	-
Balance at 31 December 2020	-	-	-
Net book value
Balance at 1 January 2019	244,595	27,381	271,976
Balance at 31 December 2019	239,451	28,486	267,937
Balance at 31 December 2020	235,581	30,787	266,368

	31 December	31 December
	2020	2019
	RMB million	RMB million
Cost	16,481	16,558
Less: Accumulated impairment losses	(7,861)	(7,861)
	8,620	8,697

	Principal activities	31 December	31 December
2020	2019
		RMB million	RMB million
Sinopec Zhenhai Refining and Chemical Branch	Manufacturing of intermediate petrochemical products and petroleum products	4,043	4,043
Shanghai SECCO Petrochemical Company Limited ('Shanghai SECCO')	Production and sale of petrochemical products	2,541	2,541
Sinopec Beijing Yanshan Petrochemical Branch	Manufacturing of intermediate petrochemical products and petroleum products	1,004	1,004
Other units without individually significant goodwill		1,032	1,109
		8,620	8,697

Name of company	% of ownership interests	Principal activities	Measurement method	Country of incorporation	Principal place of business
PipeChina (i)	14.00	Operation of oil and natural gas pipeline and auxiliary facilities	Equity method	PRC	PRC
Sinopec Finance Company Limited ('Sinopec Finance')	49.00	Provision of non-banking financial services	Equity method	PRC	PRC
PAO SIBUR Holding ('SIBUR') (ii)	10.00	Processing natural gas and manufacturing petrochemical products	Equity method	Russia	Russia
Zhongtian Synergetic Energy Company Limited ('Zhongtian Synergetic Energy')	38.75	Mining coal and manufacturing of coal-chemical products	Equity method	PRC	PRC
Caspian Investments Resources Ltd. ('CIR')	50.00	Crude oil and natural gas extraction	Equity method	British Virgin Islands	The Republic of Kazakhstan

	PipeChina	Sinopec Finance	SIBUR	Zhongtian Synergetic Energy	CIR
	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December
	2020	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets	74,012	175,139	180,383	30,678	31,634	3,721	4,219	2,402	7,612
Non-current assets	655,982	53,008	18,926	147,140	182,646	53,124	56,424	903	971
Current liabilities	(55,562)	(197,872)	(170,621)	(31,157)	(31,295)	(8,315)	(13,887)	(699)	(936)
Non-current liabilities	(104,150)	(514)	(582)	(58,941)	(71,289)	(28,422)	(26,227)	(286)	(166)
Net assets	570,282	29,761	28,106	87,720	111,696	20,108	20,529	2,320	7,481
Net assets attributable to owners of the Company	505,336	29,761	28,106	87,280	111,250	20,108	20,529	2,320	7,481
Net assets attributable to non-controlling interests	64,946	-	-	440	446	-	-	-	-
Share of net assets from associates	70,747	14,583	13,772	8,728	11,125	7,792	7,955	1,160	3,741
Carrying Amounts	70,747	14,583	13,772	8,728	11,125	7,792	7,955	1,160	3,741

Year ended 31 December	PipeChina (iii)	Sinopec Finance	SIBUR	Zhongtian Synergetic Energy	CIR
	2020	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	22,766	4,742	4,966	49,793	56,706	11,707	13,329	1,252	2,334
Profit/(loss) for the year	6,444	2,027	2,234	(1,936)	6,513	551	1,994	181	424
Other comprehensive (loss)/income	-	(372)	411	(19,180)	(1,435)	-	-	(308)	151
Total comprehensive income/(loss)	6,444	1,655	2,645	(21,116)	5,078	551	1,994	(127)	575
Dividends declared by associates	-	-	-	285	468	284	219	2,517	-
Share of profit/(loss) from associates	709	993	1,095	(194)	651	214	773	91	212
Share of other comprehensive (loss)/income from associates (iv)	-	(182)	201	(1,918)	(144)	-	-	(154)	76

(i)

The Group has a member in the Board of Directors of PipeChina. According to the structure and the resolution mechanism of the Board of Directors, the Group can exercise significant influence on PipeChina.

(ii)

Sinopec is able to exercise significant influence in SIBUR since Sinopec has a member in SIBUR's Board of Directors and has a member in SIBUR's Management Board.

(iii)

The summarised statement of comprehensive income for the year 2020 presents the operating results from the date when the Group can exercise significant influence on PipeChina to 31 December 2020.

(iv)

Including foreign currency translation differences.

Name of entity	% of ownership interests	Principal activities	Measurement method	Country of incorporation	Principal place of business
Fujian Refining & Petrochemical Company Limited ('FREP')	50.00	Manufacturing refining oil products	Equity method	PRC	PRC
BASF-YPC Company Limited ('BASF-YPC')	40.00	Manufacturing and distribution of petrochemical products	Equity method	PRC	PRC
Taihu Limited ('Taihu')	49.00	Crude oil and natural gas extraction	Equity method	Cyprus	Russia
Yanbu Aramco Sinopec Refining Company Ltd. ('YASREF')	37.50	Petroleum refining and processing business	Equity method	Saudi Arabia	Saudi Arabia
Sinopec SABIC Tianjin Petrochemical Company Limited ('Sinopec SABIC Tianjin')	50.00	Manufacturing and distribution of petrochemical products	Equity method	PRC	PRC

	FREP	BASF-YPC	Taihu	YASREF	Sinopec SABIC Tianjin
	31 December 2020	31 December 2019	31 December 2020	31 December 2019	31 December 2020	31 December 2019	31 December 2020	31 December 2019	31 December 2020	31 December 2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets
Cash and cash equivalents	7,448	5,603	1,838	1,154	1,280	4,485	1,408	733	5,259	3,242
Other current assets	7,492	11,977	4,777	4,937	1,223	2,336	7,516	11,311	2,665	4,501
Total current assets	14,940	17,580	6,615	6,091	2,503	6,821	8,924	12,044	7,924	7,743
Non-current assets	15,237	17,267	9,993	10,498	12,531	10,453	45,413	50,548	18,258	14,878
Current liabilities
Current financial liabilities	(1,203)	(1,280)	(456)	(237)	(38)	(57)	(9,520)	(7,445)	(998)	(500)
Other current liabilities	(5,147)	(7,090)	(2,190)	(1,808)	(1,043)	(1,815)	(8,644)	(12,504)	(3,052)	(2,896)
Total current liabilities	(6,350)	(8,370)	(2,646)	(2,045)	(1,081)	(1,872)	(18,164)	(19,949)	(4,050)	(3,396)
Non-current liabilities
Non-current financial liabilities	(8,761)	(11,185)	-	-	(85)	(125)	(29,650)	(29,445)	(6,773)	(4,592)
Other non-current liabilities	(235)	(290)	(42)	(35)	(2,017)	(1,984)	(2,008)	(1,963)	(378)	(368)
Total non-current liabilities	(8,996)	(11,475)	(42)	(35)	(2,102)	(2,109)	(31,658)	(31,408)	(7,151)	(4,960)
Net assets	14,831	15,002	13,920	14,509	11,851	13,293	4,515	11,235	14,981	14,265
Net assets attributable to owners of the company	14,831	15,002	13,920	14,509	11,439	12,829	4,515	11,235	14,981	14,265
Net assets attributable to non-controlling interests	-	-	-	-	412	464	-	-	-	-
Share of net assets from joint ventures	7,416	7,501	5,568	5,804	5,605	6,286	-	4,213	7,491	7,133
Carrying Amounts	7,416	7,501	5,568	5,804	5,605	6,286	-	4,213	7,491	7,133

Year ended 31 December	FREP	BASF-YPC	Taihu	YASREF	Sinopec SABIC Tianjin
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	38,691	57,047	15,701	19,590	9,528	15,222	37,337	75,940	14,881	20,541
Depreciation, depletion and amortisation	(2,222)	(2,541)	(1,244)	(1,474)	(541)	(629)	(3,140)	(3,048)	(1,085)	(1,094)
Interest income	118	124	27	32	291	94	17	58	183	171
Interest expense	(535)	(597)	(16)	(26)	(20)	(265)	(1,136)	(1,470)	(131)	(134)
Profit/(loss) before taxation	520	964	1,518	2,314	2,304	3,320	(7,193)	(1,292)	954	2,178
Tax expense	(87)	(197)	(379)	(579)	(378)	(708)	1,057	(8)	(236)	(533)
Profit/(loss) for the year	433	767	1,139	1,735	1,926	2,612	(6,136)	(1,300)	718	1,645
Other comprehensive loss	-	-	-	-	(3,368)	(1,105)	(584)	(261)	-	-
Total comprehensive income/(loss)	433	767	1,139	1,735	(1,442)	1,507	(6,720)	(1,561)	718	1,645
Dividends declared by joint ventures	300	1,400	691	1,224	-	-	-	-	-	1,750
Share of net profit/(loss) from joint ventures	217	384	456	694	911	1,235	(2,301)	(488)	359	823
Share of other comprehensive loss from joint ventures (i)	-	-	-	-	(1,593)	(522)	(219)	(98)	-	-

(i)

Including foreign currency translation differences.

	31 December	31 December
	2020	2019
	RMB million	RMB million
Operating rights of service stations	31,856	34,013
Long-term receivables from and prepayment to Sinopec Group Company and fellow subsidiaries	2,801	1,562
Prepayments for construction projects to third parties	5,861	3,926
Others (i)	33,971	25,936
	74,489	65,437

(i)

Others mainly comprise time deposits with terms of three years, catalyst expenditures and improvement expenditures of property, plant and equipment.

	2020	2019
	RMB million	RMB million
Operating rights of service stations
Cost:
Balance at 1 January	53,549	52,216
Additions	493	1,494
Decreases	(475)	(161)
Balance at 31 December	53,567	53,549
Accumulated amortisation:
Balance at 1 January	19,536	17,282
Additions	2,365	2,357
Decreases	(190)	(103)
Balance at 31 December	21,711	19,536
Net book value at 31 December	31,856	34,013

	31 December	31 December
	2020	2019
	RMB million	RMB million
Amounts due from third parties	22,536	43,735
Amounts due from Sinopec Group Company and fellow subsidiaries	12,120	6,062
Amounts due from associates and joint ventures	4,791	6,426
	39,447	56,223
Less: Impairment losses for bad and doubtful debts	(3,860)	(1,848)
	35,587	54,375

	31 December	31 December
	2020	2019
	RMB million	RMB million
Within one year	34,509	54,027
Between one and two years	931	190
Between two and three years	64	64
Over three years	83	94
	35,587	54,375

	2020	2019
	RMB million	RMB million
Balance at 1 January	1,848	606
Provision for the year	2,173	1,566
Written back for the year	(68)	(283)
Written off for the year	(23)	(41)
Others	(70)	-
Balance at 31 December	3,860	1,848

	31 December	31 December
	2020	2019
	RMB million	RMB million
Non-current assets
Unlisted equity instruments	1,376	1,431
Listed equity instruments	149	90
Current assets
Trade accounts receivable and bills receivable (i)	8,735	8,661
	10,260	10,182

(i)

As at 31 December 2020 and 2019, bills receivable and certain trade accounts receivable were classified as financial assets at FVOCI, as the Group's business model is achieved both by collecting contractual cash flows and selling of these assets.

	31 December	31 December
	2020	2019
	RMB million	RMB million
Crude oil and other raw materials	60,155	89,908
Work in progress	13,053	12,687
Finished goods	78,415	91,554
Spare parts and consumables	3,372	2,578
	154,995	196,727
Less: Allowance for diminution in value of inventories	(3,100)	(2,585)
	151,895	194,142

	31 December	31 December
	2020	2019
	RMB million	RMB million
Receivables	34,974	25,669
Advances to suppliers	4,862	5,063
Value-added input tax to be deducted	18,625	25,313
Prepaid income tax	131	1,879
	58,592	57,924

	Deferred tax assets	Deferred tax liabilities
	31 December	31 December	31 December	31 December
	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million
Receivables and inventories	2,411	2,546	-	-
Payables	1,286	1,142	-	-
Cash flow hedges	1,790	116	(4,420)	(384)
Property, plant and equipment	15,793	16,463	(13,415)	(12,317)
Tax losses carried forward	13,322	3,594	-	-
Financial assets at fair value through other comprehensive income	127	131	(11)	(7)
Intangible assets	869	595	(517)	(508)
Others	371	318	(676)	(882)
Deferred tax assets/(liabilities)	35,969	24,905	(19,039)	(14,098)

	31 December	31 December
	2020	2019
	RMB million	RMB million
Deferred tax assets	10,915	7,289
Deferred tax liabilities	10,915	7,289

	31 December	31 December
	2020	2019
	RMB million	RMB million
Deferred tax assets	25,054	17,616
Deferred tax liabilities	8,124	6,809

	Balance at 1 January 2019	Recognised in consolidated income statement	Recognised in other comprehensive income	Others	Transferred from reserve	Balance at 31 December 2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Receivables and inventories	2,563	(17)	-	-	-	2,546
Payables	1,808	(667)	-	1	-	1,142
Cash flow hedges	1,104	73	(1,195)	-	(250)	(268)
Property, plant and equipment	6,761	(2,575)	(39)	(1)	-	4,146
Tax losses carried forward	3,709	(151)	38	(2)	-	3,594
Financial assets at fair value through other comprehensive income	116	-	8	-	-	124
Intangible assets	(61)	148	-	-	-	87
Others	(254)	(196)	(49)	(65)	-	(564)
Net deferred tax assets/(liabilities)	15,746	(3,385)	(1,237)	(67)	(250)	10,807

	Balance at 1 January 2020	Recognised in consolidated income statement	Recognised in other comprehensive income	Others	Transferred from reserve	Balance at 31 December 2020
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Receivables and inventories	2,546	(122)	(12)	(1)	-	2,411
Payables	1,142	144	-	-	-	1,286
Cash flow hedges	(268)	(42)	(2,316)	-	(4)	(2,630)
Property, plant and equipment	4,146	(2,244)	127	349	-	2,378
Tax losses carried forward	3,594	9,960	(84)	(148)	-	13,322
Financial assets at fair value through other comprehensive income	124	(4)	(4)	-	-	116
Intangible assets	87	19	-	246	-	352
Others	(564)	162	24	73	-	(305)
Net deferred tax assets/(liabilities)	10,807	7,873	(2,265)	519	(4)	16,930

	31 December	31 December
	2020	2019
	RMB million	RMB million
Third parties' debts
Short-term bank loans	16,111	25,709
RMB denominated	16,111	25,619
US Dollar ('USD') denominated	-	90
Short-term other loans	3	22
RMB denominated	3	22
Current portion of long-term bank loans	4,637	1,790
RMB denominated	4,613	1,765
USD denominated	24	25
Current portion of long-term corporate bonds	-	13,000
RMB denominated	-	13,000
	4,637	14,790
Corporate bonds (i)	3,018	-
RMB denominated	3,018	-
	23,769	40,521
Loans from Sinopec Group Company and fellow subsidiaries
Short-term loans	4,642	5,465
RMB denominated	1,141	2,709
USD denominated	3,298	2,236
Hong Kong Dollar ('HKD') denominated	31	495
European Dollar ('EUR') denominated	172	25
Current portion of long-term loans	622	37,824
RMB denominated	622	37,824
	5,264	43,289
	29,033	83,810

	Interest rate and final maturity	31 December	31 December
		2020	2019
		RMB million	RMB million
Third parties' debts
Long-term bank loans
RMB denominated	Interest rates ranging from 1.08% to 5.23% per annum at 31 December 2020 with maturities through 2030	38,226	31,714
USD denominated	Interest rates at 1.55% per annum at 31 December 2020 with maturities through 2039	92	127
		38,318	31,841
Corporate bonds (ii)
RMB denominated	Fixed interest rates ranging from 2.20% to 4.90% per annum at 31 December 2020 with maturity through 2023	26,977	20,000
USD denominated	Fixed interest rates ranging from 3.13% to 4.25% per annum at 31 December 2020 with maturities through 2043	11,379	12,157
		38,356	32,157
Total third parties' long-term debts		76,674	63,998
Less: Current portion		(4,637)	(14,790)
		72,037	49,208
Long-term loans from Sinopec Group Company and fellow subsidiaries
RMB denominated	Interest rates ranging from 1.08% to 5.23% per annum at 31 December 2020 with maturities through 2036	11,013	47,450
USD denominated	Interest rates at 1.60% per annum at 31 December 2020 with maturities in 2027	1,387	-
Less: Current portion		(622)	(37,824)
		11,778	9,626
		83,815	58,834

(i)

The Company issued Super & Short-term Commercial Paper on 20 August 2020 at par value of RMB 100, and the interest will be paid at its maturity. The total issued amount of the 169-day corporate bonds is RMB 3 billion with a fixed rate at 1.70% per annum.

(ii)

The Company issued corporate bonds with a maturity of three years on 31 March 2020 at par value of RMB 100. The total issued amount of the corporate bonds is RMB 10 billion. The corporate bonds adopt a simple interest rate on an annual basis with a fixed rate at 2.70% per annum and the interest is paid once a year.

	31 December	31 December
	2020	2019
	RMB million	RMB million
Lease liabilities
Current	15,292	15,198
Non-current	172,306	177,674
	187,598	192,872

	31 December	31 December
	2020	2019
	RMB million	RMB million
Amounts due to third parties	132,136	166,830
Amounts due to Sinopec Group Company and fellow subsidiaries	11,384	11,251
Amounts due to associates and joint ventures	7,742	10,108
	151,262	188,189
Bills payable	10,394	11,834
Trade accounts payable and bills payable measured at amortised cost	161,656	200,023

	31 December	31 December
	2020	2019
	RMB million	RMB million
Within 1 month or on demand	146,295	185,377
Between 1 month and 6 months	9,665	8,981
Over 6 months	5,696	5,665
	161,656	200,023

	31 December	31 December
	2020	2019
	RMB million	RMB million
Salaries and welfare payable	7,081	4,807
Interest payable	667	612
Payables for constructions	41,724	50,824
Other payables	58,908	25,618
Financial liabilities carried at amortised costs	108,380	81,861
Taxes other than income tax	70,257	66,257
	178,637	148,118

	2020	2019
	RMB million	RMB million
Balance at 1 January	42,438	42,007
Provision for the year	1,563	1,408
Accretion expenses	1,343	1,418
Decrease for the year	(1,490)	(2,439)
Exchange adjustments	(141)	44
Balance at 31 December	43,713	42,438

	31 December	31 December
	2020	2019
	RMB million	RMB million
Registered, issued and fully paid
95,557,771,046 listed A shares (2019: 95,557,771,046) of RMB 1.00 each	95,558	95,558
25,513,438,600 listed H shares (2019: 25,513,438,600) of RMB 1.00 each	25,513	25,513
	121,071	121,071

	31 December	31 December
	2020	2019
	RMB million	RMB million
Authorised and contracted for (i)	171,335	138,088
Authorised but not contracted for	33,942	63,967
	205,277	202,055

(i)

The investment commitments of the Group is RMB 13,172 million (2019: RMB 6,100 million).

	31 December	31 December
	2020	2019
	RMB million	RMB million
Within one year	390	302
Between one and two years	99	69
Between two and three years	66	34
Between three and four years	63	30
Between four and five years	56	29
Thereafter	824	845
	1,498	1,309

	31 December	31 December
	2020	2019
	RMB million	RMB million
Joint ventures	6,390	7,100
Associates (ii)	8,450	10,140
	14,840	17,240

(ii)

The Group provided a guarantee in respect to standby credit facilities granted to Zhongtian Synergetic Energy by banks amount to RMB 17,050 million. As at 31 December 2020, the amount withdrawn by Zhongtian Synergetic Energy and guaranteed by the Group was RMB 8,450 million (2019: RMB 10,140 million).

	The Group, as	Baling	Elimination	The Group,
	previously	Branch	and	as restated
	reported	of SAMC	Adjustment*
	RMB million	RMB million	RMB million	RMB million
Summarised consolidated income statement for the year ended 31 December 2019:
Turnover and other operating revenues	2,966,193	16,906	(23,300)	2,959,799
Profit attributable to shareholders of the Company	57,465	50	(22)	57,493
Profit attributable to non-controlling interests	14,568	-	22	14,590
Basic earnings per share (RMB)	0.475	0.0004	-	0.475
Diluted earnings per share (RMB)	0.475	0.0004	-	0.475
Summarised consolidated balance sheet as at 31 December 2019:
Current assets	445,856	2,097	(643)	447,310
Total assets	1,755,071	5,858	(643)	1,760,286
Current liabilities	576,374	4,247	(643)	579,978
Total liabilities	879,236	4,389	(643)	882,982
Total equity attributable to shareholders of the Company	738,150	1,448	(652)	738,946
Non-controlling interests	137,685	21	652	138,358
Summarised consolidated statement of cash flows for the year ended 31 December 2019:
Net cash generated from operating activities	153,420	199	-	153,619
Net cash used in investing activities	(120,463)	(588)	-	(121,051)
Net cash (used in)/generated from financing activities	(84,713)	509	-	(84,204)
Net (decrease)/increase in cash and cash equivalents	(51,756)	120	-	(51,636)

(a)

Transactions with Sinopec Group Company and fellow subsidiaries, associates and joint ventures

	Note	2020	2019
		RMB million	RMB million
Sales of goods	(i)	233,283	285,853
Purchases	(ii)	158,963	189,914
Transportation and storage	(iii)	8,848	8,206
Exploration and development services	(iv)	31,444	33,310
Production related services	(v)	32,106	38,827
Ancillary and social services	(vi)	3,099	3,098
Agency commission income	(vii)	160	116
Interest income	(viii)	704	1,066
Interest expense	(ix)	919	1,334
Net deposits (placed with)/withdrawn from related parties	(viii)	(17,585)	5,230
Net funds (repaid to)/obtained from related parties	(x)	(31,144)	3,438

(a)

Transactions with Sinopec Group Company and fellow subsidiaries, associates and joint ventures (Continued)

(i)

Sales of goods represent the sale of crude oil, intermediate petrochemical products, petroleum products and ancillary materials.

(ii)

Purchases represent the purchase of materials and utility supplies directly related to the Group's operations such as the procurement of raw and ancillary materials and related services, supply of water, electricity and gas.

(iii)

Transportation and storage represent the cost for the use of railway, road and marine transportation services, pipelines, loading, unloading and storage facilities.

(iv)

Exploration and development services comprise direct costs incurred in the exploration and development such as geophysical, drilling, well testing and well measurement services.

(v)

Production related services represent ancillary services rendered in relation to the Group's operations such as equipment repair and general maintenance, insurance premium, technical research, communications, firefighting, security, product quality testing and analysis, information technology, design and engineering, construction of oilfield ground facilities, refineries and chemical plants, manufacture of replacement parts and machinery, installation, project management, environmental protection and management services.

(vi)

Ancillary and social services represent expenditures for social welfare and support services such as educational facilities, media communication services, sanitation, accommodation, canteens, and property maintenance.

(vii)

Agency commission income represents commission earned for acting as an agent in respect of sales of products and purchase of materials for certain entities owned by Sinopec Group Company.

(viii)

Interest income represents interest received from deposits placed with Sinopec Finance and Sinopec Century Bright Capital Investment Limited, finance companies controlled by Sinopec Group Company. The applicable interest rate is determined in accordance with the prevailing saving deposit rate. The balance of deposits at 31 December 2020 was RMB 53,417 million (2019: RMB 35,832 million).

(ix)

Interest expense represents interest charges on the loans obtained from Sinopec Group Company and fellow subsidiaries.

(x)

The Group obtained loans, discounted bills and others from Sinopec Group Company and fellow subsidiaries.

‧

The Company has entered into a non-exclusive 'Agreement for Mutual Provision of Products and Ancillary Services' ('Mutual Provision Agreement') with Sinopec Group Company effective from 1 January 2000 in which Sinopec Group Company has agreed to provide the Group with certain ancillary production services, construction services, information advisory services, supply services and other services and products. While each of Sinopec Group Company and the Company is permitted to terminate the Mutual Provision Agreement upon at least six months notice, Sinopec Group Company has agreed not to terminate the agreement if the Group is unable to obtain comparable services from a third party. The pricing policy for these services and products provided by Sinopec Group Company to the Group is as follows:

(1)

the government-prescribed price;

(2)

where there is no government-prescribed price, the government-guidance price;

(3)

where there is neither a government-prescribed price nor a government-guidance price, the market price; or

(4)

where none of the above is applicable, the price to be agreed between the parties, which shall be based on a reasonable cost incurred in providing such services plus a profit margin not exceeding 6%.

‧

The Company has entered into a non-exclusive 'Agreement for Provision of Cultural and Educational, Health Care and Community Services' with Sinopec Group Company effective from 1 January 2000 in which Sinopec Group Company has agreed to provide the Group with certain cultural, educational, health care and community services on the same pricing terms and termination conditions as described in the above Mutual Provision Agreement.

‧

The Company has entered into a series of lease agreements with Sinopec Group Company to lease certain lands and buildings effective on 1 January 2000. The lease term is 40 or 50 years for lands and 20 years for buildings, respectively. The Company and Sinopec Group Company can renegotiate the rental amount every three years for land. The Company and Sinopec Group Company can renegotiate the rental amount for buildings every year. However such amount cannot exceed the market price as determined by an independent third party.

‧

The Company has entered into agreements with Sinopec Group Company effective from 1 January 2000 under which the Group has been granted the right to use certain trademarks, patents, technology and computer software developed by Sinopec Group Company.

‧

The Company has entered into a service stations franchise agreement with Sinopec Group Company effective from 1 January 2000 under which its service stations and retail stores would exclusively sell the refined products supplied by the Group.

(a)

Transactions with Sinopec Group Company and fellow subsidiaries, associates and joint ventures (Continued)

‧

On the basis of a series of continuing connected transaction agreements signed in 2000, the Company and Sinopec Group Company have signed the Fifth Supplementary Agreement and the Fourth Revised Memorandum of land use rights leasing contract on 24 August 2018, which took effect on 1 January 2019 and made adjustment to 'Mutual Supply Agreement', 'Agreement for Provision of Cultural and Educational, Health Care and Community Services', 'Buildings Leasing Contract', 'Intellectual Property Contract' and 'Land Use Rights Leasing Contract', etc.

	31 December	31 December
	2020	2019
	RMB million	RMB million
Trade accounts receivable	16,896	12,470
Financial assets at fair value through other comprehensive income	760	407
Prepaid expenses and other current assets	19,305	12,771
Long-term prepayments and other assets	6,435	734
Total	43,396	26,382
Trade accounts payable and bills payable	22,805	25,177
Contract liabilities	5,940	4,456
Other payables	12,116	18,793
Other long-term liabilities	3,010	-
Short-term loans and current portion of long-term loans from Sinopec Group Company and fellow subsidiaries	5,264	43,289
Long-term loans excluding current portion from Sinopec Group Company and fellow subsidiaries	11,778	9,626
Lease liabilities (including to be paid within one year)	162,048	171,402
Total	222,961	272,743

(b)

Key management personnel emoluments

	2020	2019
	RMB'000	RMB'000
Short-term employee benefits	5,753	9,209
Retirement scheme contributions	342	536
	6,095	9,745

(c)

Contributions to defined contribution retirement plans

(d)

Transactions with other state-controlled entities in the PRC

‧

sales and purchases of goods and ancillary materials;

‧

rendering and receiving services;

‧

lease of assets;

‧

depositing and borrowing money; and

‧

uses of public utilities.

(i)

Exploration and production, which explores and develops oil fields, produces crude oil and natural gas and sells such products to the refining segment of the Group and external customers.

(ii)

Refining, which processes and purifies crude oil, that is sourced from the exploration and production segment of the Group and external suppliers, and manufactures and sells petroleum products to the chemicals and marketing and distribution segments of the Group and external customers.

(iii)

Marketing and distribution, which owns and operates oil depots and service stations in the PRC, and distributes and sells refined petroleum products (mainly gasoline and diesel) in the PRC through wholesale and retail sales networks.

(iv)

Chemicals, which manufactures and sells petrochemical products, derivative petrochemical products and other chemical products mainly to external customers.

(v)

Corporate and others, which largely comprises the trading activities of the import and export companies of the Group and research and development undertaken by other subsidiaries.

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities

	2020	2019
	RMB million	RMB million
Turnover
Exploration and production
External sales	104,524	111,114
Inter-segment sales	57,513	89,315
	162,037	200,429
Refining
External sales	114,064	141,674
Inter-segment sales	825,812	1,077,018
	939,876	1,218,692
Marketing and distribution
External sales	1,062,447	1,393,557
Inter-segment sales	4,854	4,159
	1,067,301	1,397,716
Chemicals
External sales	322,121	428,830
Inter-segment sales	40,518	78,165
	362,639	506,995
Corporate and others
External sales	458,154	824,507
Inter-segment sales	430,073	654,337
	888,227	1,478,844
Elimination of Inter-segment sales	(1,370,624)	(1,902,994)
Turnover	2,049,456	2,899,682
Other operating revenues
Exploration and production	5,718	10,283
Refining	4,634	5,464
Marketing and distribution	34,905	33,247
Chemicals	9,215	9,273
Corporate and others	2,056	1,850
Other operating revenues	56,528	60,117
Turnover and other operating revenues	2,105,984	2,959,799

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities (Continued)

	2020	2019
	RMB million	RMB million
Result
Operating (loss)/profit
By segment
- Exploration and production	(16,476)	9,284
- Refining	(5,555)	30,632
- Marketing and distribution	20,828	29,107
- Chemicals	10,372	17,327
- Corporate and others	(393)	64
- Elimination	4,417	(40)
Total segment operating profit	13,193	86,374
Share of profit/(loss) from associates and joint ventures
- Exploration and production	2,117	3,167
- Refining	(2,516)	(640)
- Marketing and distribution	2,200	3,309
- Chemicals	1,723	4,611
- Corporate and others	3,188	2,330
Aggregate share of profits from associates and joint ventures	6,712	12,777
Investment income/(loss)
- Exploration and production	13,118	(19)
- Refining	14,941	59
- Marketing and distribution	8,980	73
- Chemicals	(61)	578
- Corporate and others	766	228
Aggregate investment income	37,744	919
Net finance costs	(9,506)	(10,048)
Profit before taxation	48,143	90,022

	31 December	31 December
	2020	2019
	RMB million	RMB million
Assets
Segment assets
- Exploration and production	354,024	410,950
- Refining	270,431	321,080
- Marketing and distribution	373,430	399,242
- Chemicals	186,033	180,974
- Corporate and others	118,458	131,686
Total segment assets	1,302,376	1,443,932
Interest in associates and joint ventures	188,342	152,204
Financial assets at fair value through other comprehensive income	1,525	1,521
Deferred tax assets	25,054	17,616
Cash and cash equivalents, time deposits with financial institutions	188,057	128,052
Other unallocated assets	28,451	16,961
Total assets	1,733,805	1,760,286
Liabilities
Segment liabilities
- Exploration and production	163,588	167,933
- Refining	136,869	122,264
- Marketing and distribution	234,309	226,531
- Chemicals	49,497	58,066
- Corporate and others	119,215	137,881
Total segment liabilities	703,478	712,675
Short-term debts	23,769	40,521
Income tax payable	6,586	3,267
Long-term debts	72,037	49,208
Loans from Sinopec Group Company and fellow subsidiaries	17,042	52,915
Deferred tax liabilities	8,124	6,809
Other unallocated liabilities	19,911	17,587
Total liabilities	850,947	882,982

(1)

Information of reportable segmental revenues, profits or losses, assets and liabilities (Continued)

	2020	2019
	RMB million	RMB million
Capital expenditure
Exploration and production	56,416	61,739
Refining	24,722	31,372
Marketing and distribution	25,403	29,566
Chemicals	26,202	22,438
Corporate and others	2,312	1,979
	135,055	147,094
Depreciation, depletion and amortisation
Exploration and production	46,273	50,732
Refining	20,048	19,676
Marketing and distribution	23,196	21,572
Chemicals	14,376	14,326
Corporate and others	3,072	2,866
	106,965	109,172
Impairment losses on long-lived assets
Exploration and production	8,495	3
Refining	1,923	245
Marketing and distribution	536	80
Chemicals	3,606	17
Corporate and others	-	-
	14,560	345

	2020	2019
	RMB million	RMB million
External sales
Mainland China	1,721,955	2,124,684
Singapore	215,846	505,672
Others	168,183	329,443
	2,105,984	2,959,799

	31 December	31 December
	2020	2019
	RMB million	RMB million
Non-current assets
Mainland China	1,211,441	1,239,437
Others	36,782	52,705
	1,248,223	1,292,142

Name of company	Particulars of issued capital (million)	Interests held by the Company %	Interests held by non-controlling interests %	Principal activities
Sinopec Great Wall Energy & Chemical Company Limited	RMB 22,761	100.00	-	Coal chemical industry investment management, production and sale of coal chemical products
Sinopec Yangzi Petrochemical Company Limited	RMB 15,651	100.00	-	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Overseas Investment Holding Limited ('SOIH')	USD1,662	100.00	-	Investment holding of overseas business
Sinopec International Petroleum Exploration and Production Limited ('SIPL')	RMB 8,250	100.00	-	Investment in exploration, production and sale of petroleum and natural gas
Sinopec Yizheng Chemical Fibre Limited Liability Company	RMB 4,000	100.00	-	Production and sale of polyester chips and polyester fibres
Sinopec Lubricant Company Limited	RMB 3,374	100.00	-	Production and sale of refined petroleum products, lubricant base oil, and petrochemical materials
China International United Petroleum and Chemical Company Limited	RMB 5,000	100.00	-	Trading of crude oil and petrochemical products
Sinopec Qingdao Petrochemical Company Limited	RMB 1,595	100.00	-	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Catalyst Company Limited	RMB 1,500	100.00	-	Production and sale of catalyst products
China Petrochemical International Company Limited	RMB 1,400	100.00	-	Trading of petrochemical products
Sinopec Chemical Sales Company Limited	RMB 1,000	100.00	-	Marketing and distribution of petrochemical products
Sinopec Beihai Refining and Chemical Limited Liability Company	RMB 5,294	98.98	1.02	Import and processing of crude oil, production, storage and sale of petroleum products and petrochemical products
ZhongKe (Guangdong) Refinery & Petrochemical Company Limited	RMB 6,397	90.30	9.70	Crude oil processing and petroleum products manufacturing
Sinopec Qingdao Refining and Chemical Company Limited	RMB 5,000	85.00	15.00	Manufacturing of intermediate petrochemical products and petroleum products
Sinopec Hainan Refining and Chemical Company Limited	RMB 9,606	75.00	25.00	Manufacturing of intermediate petrochemical products and petroleum products
Marketing Company	RMB 28,403	70.42	29.58	Marketing and distribution of refined petroleum products
Shanghai SECCO	RMB 7,801	67.60	32.40	Production and sale of petrochemical products
Sinopec Kantons Holdings Limited ('Sinopec Kantons')	HKD248	60.33	39.67	Provision of crude oil jetty services and natural gas pipeline transmission services
Sinopec-SK (Wuhan) Petrochemical Company Limited ('Sinopec-SK')	RMB 7,193	59.00	41.00	Production, sale, research and development of petrochemical products, ethylene and downstream byproducts
Gaoqiao Petrochemical Company Limited	RMB 10,000	55.00	45.00	Manufacturing of intermediate petrochemical products and petroleum products
Baling Petrochemical (i)	RMB 3,000	55.00	45.00	Crude oil processing and petroleum products manufacturing
Sinopec Shanghai Petrochemical Company Limited ('Shanghai Petrochemical')	RMB 10,824	50.44	49.56	Manufacturing of synthetic fibres, resin and plastics, intermediate petrochemical products and petroleum products
Fujian Petrochemical Company Limited ('Fujian Petrochemical') (ii)	RMB 10,492	50.00	50.00	Manufacturing of plastics, intermediate petrochemical products and petroleum products

(i)

See Note 38.

(ii)

The Group consolidated the financial statements of the entity because it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

	Marketing Company	SIPL	Shanghai Petrochemical	Fujian Petrochemical	Sinopec Kantons	Shanghai SECCO	Sinopec-SK
	At	At	At	At	At	At	At	At	At	At	At	At	At	At
	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December	31 December
	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Current assets	172,352	129,266	22,620	19,151	17,305	22,309	1,582	1,788	4,373	1,284	10,431	11,858	3,639	5,337
Current liabilities	(201,678)	(192,106)	(475)	(456)	(15,232)	(15,479)	(458)	(804)	(924)	(2,961)	(2,783)	(3,196)	(6,377)	(15,037)
Net current (liabilities)/assets	(29,326)	(62,840)	22,145	18,695	2,073	6,830	1,124	984	3,449	(1,677)	7,648	8,662	(2,738)	(9,700)
Non-current assets	323,571	340,356	8,951	13,234	27,314	23,185	12,568	11,558	9,106	12,777	12,177	11,473	22,187	21,567
Non-current liabilities	(59,554)	(58,732)	(18,270)	(16,952)	(52)	(21)	(693)	(688)	(170)	(158)	(1,553)	(1,627)	(8,509)	(7)
Net non-current assets/(liabilities)	264,017	281,624	(9,319)	(3,718)	27,262	23,164	11,875	10,870	8,936	12,619	10,624	9,846	13,678	21,560
Net assets	234,691	218,784	12,826	14,977	29,335	29,994	12,999	11,854	12,385	10,942	18,272	18,508	10,940	11,860
Attributable to owners of the Company	159,205	148,256	5,876	6,308	14,727	14,998	6,499	5,927	7,454	6,583	12,352	12,511	6,455	6,997
Attributable to non-controlling interests	75,486	70,528	6,950	8,669	14,608	14,996	6,500	5,927	4,931	4,359	5,920	5,997	4,485	4,863

Year ended 31 December	Marketing Company	SIPL	Shanghai Petrochemical	Fujian Petrochemical	Sinopec Kantons	Shanghai SECCO	Sinopec-SK
2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Turnover	1,099,680	1,427,705	2,017	3,282	74,624	100,270	4,871	5,535	1,064	1,274	21,626	28,341	28,702	31,016
Profit/(loss) for the year	22,415	22,992	1,160	2,831	656	2,227	243	477	2,047	1,131	2,132	3,137	(920)	701
Total comprehensive income/(loss)	21,149	23,362	(720)	2,693	645	2,235	243	477	1,814	1,140	2,132	3,137	(920)	701
Comprehensive income/(loss) attributable to non-controlling interests	7,205	8,289	(287)	1,651	325	1,113	121	238	707	433	691	1,016	(377)	245
Dividends paid to non-controlling interests	2,766	4,830	316	10,926	649	1,344	150	650	175	159	767	822	-	-

Year ended 31 December	Marketing Company	SIPL	Shanghai Petrochemical	Fujian Petrochemical	Sinopec Kantons	Shanghai SECCO	Sinopec-SK
2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Net cash generated from/(used in) operating activities	54,139	40,260	281	2,128	1,680	5,057	(244)	622	586	716	3,119	4,601	(363)	5,532
Net cash (used in)/generated from investing activities	(40,010)	(25,923)	(2,659)	678	(3,888)	(4,623)	(649)	(472)	3,846	397	(4,335)	(91)	(2,340)	(4,987)
Net cash (used in)/generated from financing activities	(12,402)	(21,535)	1,683	(116)	1,682	(1,737)	882	(163)	(1,250)	(1,208)	(2,879)	(2,050)	2,176	250
Net increase/(decrease) in cash and cash equivalents	1,727	(7,198)	(695)	2,690	(526)	(1,303)	(11)	(13)	3,182	(95)	(4,095)	2,460	(527)	795
Cash and cash equivalents at 1 January	6,901	14,142	8,833	5,993	7,450	8,742	79	92	117	198	9,278	6,817	1,593	798
Effect of foreign currency exchange rate changes	14	(43)	(439)	150	(8)	11	-	-	(117)	14	(2)	1	-	-
Cash and cash equivalents at 31 December	8,642	6,901	7,699	8,833	6,916	7,450	68	79	3,182	117	5,181	9,278	1,066	1,593

‧

credit risk;

‧

liquidity risk; and

‧

market risk.

(i)

Risk management

(ii)

Impairment of financial assets

	31 December 2020
		Total
		contractual	Within	More than 1	More than 2
	Carrying	undiscounted	1 year or	year but less	years but less	More than
	amount	cash flow	on demand	than 2 years	than 5 years	5 years
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Short-term debts	23,769	25,280	25,280	-	-	-
Long-term debts	72,037	80,562	1,339	11,753	60,414	7,056
Loans from Sinopec Group Company and fellow subsidiaries	17,042	17,978	5,512	929	10,109	1,428
Lease liabilities	187,598	329,083	15,957	15,456	43,513	254,157
Derivative financial liabilities	4,826	4,826	4,826	-	-	-
Trade accounts payable and bills payable	161,656	161,656	161,656	-	-	-
Other payables	93,623	93,623	93,623	-	-	-
	560,551	713,008	308,193	28,138	114,036	262,641

	31 December 2019
		Total
		contractual	Within	More than 1	More than 2
	Carrying	undiscounted	1 year or	year but less	years but less	More than
	amount	cash flow	on demand	than 2 years	than 5 years	5 years
	RMB million	RMB million	RMB million	RMB million	RMB million	RMB million
Short-term debts	40,521	42,240	42,240	-	-	-
Long-term debts	49,208	62,955	952	6,271	25,189	30,543
Loans from Sinopec Group Company and fellow subsidiaries	52,915	54,508	43,623	985	7,088	2,812
Lease liabilities	192,872	367,711	16,488	15,676	45,008	290,539
Derivative financial liabilities	2,729	2,729	2,729	-	-	-
Trade accounts payable and bills payable	200,023	200,023	200,023	-	-	-
Other payables	81,861	81,861	81,861	-	-	-
	620,129	812,027	387,916	22,932	77,285	323,894

(a)

Currency risk

	31 December	31 December
	2020	2019
	million	million
Gross exposure arising from loans and lease liabilities
USD	22	103
SGD	-	4

	31 December	31 December
	2020	2019
	RMB million	RMB million
USD	5	27
SGD	-	1

(b)

Interest rate risk

(c)

Commodity price risk

(i)

Financial instruments carried at fair value

‧

Level 1 (highest level): fair values measured using quoted prices (unadjusted) in active markets for identical financial instruments.

‧

Level 2: fair values measured using quoted prices in active markets for similar financial instruments, or using valuation techniques in which all significant inputs are directly or indirectly based on observable market data.

‧

Level 3 (lowest level): fair values measured using valuation techniques in which any significant input is not based on observable market data.

	Level 1	Level 2	Level 3	Total
	RMB million	RMB million	RMB million	RMB million
Assets
Financial assets at fair value through profit or loss:
- Equity investments, listed and at quoted market price	1	-	-	1
Derivative financial assets:
- Derivative financial assets	9,628	2,900	-	12,528
Financial assets at fair value through other comprehensive income:
- Equity instruments	149	-	1,376	1,525
- Trade accounts receivable and bills receivable	-	-	8,735	8,735
	9,778	2,900	10,111	22,789
Liabilities
Derivative financial liabilities:
- Derivative financial liabilities	2,471	2,355	-	4,826
	2,471	2,355	-	4,826

	Level 1	Level 2	Level 3	Total
	RMB million	RMB million	RMB million	RMB million
Assets
Financial assets at fair value through profit or loss:
- Structured deposits	-	-	3,318	3,318
- Equity investments, listed and at quoted market price	1	-	-	1
Derivative financial assets:
- Derivative financial assets	128	709	-	837
Financial assets at fair value through other comprehensive income:
- Equity instruments	90	-	1,431	1,521
- Trade accounts receivable and bills receivable	-	-	8,661	8,661
Liabilities	219	709	13,410	14,338
Derivative financial liabilities:
- Derivative financial liabilities	1,209	1,520	-	2,729
	1,209	1,520	-	2,729

(ii)

Fair values of financial instruments carried at other than fair value

	31 December	31 December
	2020	2019
	RMB million	RMB million
Carrying amount	76,674	63,998
Fair value	74,282	62,646

BALANCE SHEET OF THE COMPANY (Amounts in million)	Note	31 December	31 December
		2020	2019
		RMB	RMB
Non-current assets
Property, plant and equipment, net		283,691	291,544
Construction in progress		59,880	60,493
Right-of-use assets		115,992	120,037
Investment in subsidiaries		259,087	266,359
Interest in associates		69,508	22,798
Interest in joint ventures		14,761	15,530
Financial assets at fair value through other comprehensive income		428	395
Deferred tax assets		12,661	7,315
Long-term prepayments and other assets		30,855	6,727
Total non-current assets		846,863	791,198
Current assets
Cash and cash equivalents		28,081	15,984
Time deposits with financial institutions		71,107	38,088
Derivative financial assets		7,776	940
Trade accounts receivable		21,763	21,544
Financial assets at fair value through other comprehensive income		707	207
Dividends receivable		796	41
Inventories		39,034	49,116
Prepaid expenses and other current assets		53,816	106,645
Total current assets		223,080	232,565
Current liabilities
Short-term debts		21,571	32,329
Loans from Sinopec Group Company and fellow subsidiaries		3,271	39,439
Lease liabilities		7,190	7,198
Derivative financial liabilities		362	157
Trade accounts payable and bills payable		71,840	80,118
Contract liabilities		5,840	5,112
Other payables		234,844	162,852
Total current liabilities		344,918	327,205
Net current liabilities		121,838	94,640
Total assets less current liabilities		725,025	696,558
Non-current liabilities
Long-term debts		49,311	12,999
Loans from Sinopec Group Company and fellow subsidiaries		8,079	6,681
Lease liabilities		105,691	107,783
Provisions		36,089	34,514
Other long-term liabilities		4,472	5,404
Total non-current liabilities		203,642	167,381
		521,383	529,177
Equity
Share capital		121,071	121,071
Reserves	(a)	400,312	408,106
Total equity		521,383	529,177

(a)

RESERVES MOVEMENT OF THE COMPANY

	The Company
	2020	2019
	RMB million	RMB million
Capital reserve
Balance at 1 January	9,247	9,201
Others	135	46
Balance at 31 December	9,382	9,247
Share premium
Balance at 1 January	55,850	55,850
Balance at 31 December	55,850	55,850
Statutory surplus reserve
Balance at 1 January	90,423	86,678
Appropriation	1,857	3,745
Balance at 31 December	92,280	90,423
Discretionary surplus reserve
Balance at 1 January	117,000	117,000
Balance at 31 December	117,000	117,000
Other reserves
Balance at 1 January	3,912	2,286
Share of other comprehensive (loss)/income of associates and joint ventures, net of deferred tax	(182)	201
Cash flow hedges, net of deferred tax	4,911	1,465
Special reserve	240	(40)
Balance at 31 December	8,881	3,912
Retained earnings
Balance at 1 January	131,674	144,132
Profit for the year	18,821	37,256
Distribution to owners (Note 14)	(31,479)	(46,008)
Appropriation	(1,857)	(3,745)
Special reserve	(240)	40
Others	-	(1)
Balance at 31 December	116,919	131,674
	400,312	408,106

(C)	DIFFERENCES BETWEEN CONSOLIDATED FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH THE ACCOUNTING POLICIES COMPLYING WITH CASs AND IFRS (UNAUDITED)

(i)	GOVERNMENT GRANTS

(ii)	SAFETY PRODUCTION FUND

	Note	31 December	31 December
		2020	2019
		RMB million	RMB million
Shareholders' equity under CASs		883,876	878,374
Adjustments:
Government grants	(i)	(1,018)	(1,070)
Total equity under IFRS*		882,858	877,304

	Note	2020	2019
		RMB million	RMB million
Net profit under CASs		41,750	72,172
Adjustments:
Government grants	(i)	52	54
Safety production fund	(ii)	237	69
Others		(115)	(212)
Profit for the year under IFRS*		41,924	72,083

*

The figures are extracted from the consolidated financial statements prepared in accordance with the accounting policies complying with IFRS during the year ended 31 December 2019 and 2020 which have been audited by PricewaterhouseCoopers.

(D)	SUPPLEMENTAL INFORMATION ON OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED)

	2020 RMB million	2019 RMB million
	Total	China	Other countries	Total	China	Other countries
The Group
Property cost, wells and related equipments and facilities	757,592	716,683	40,909	727,552	684,246	43,306
Supporting equipments and facilities	184,638	184,621	17	202,208	202,192	16
Uncompleted wells, equipments and facilities	37,445	37,439	6	46,712	46,526	186
Total capitalised costs	979,675	938,743	40,932	976,472	932,964	43,508
Accumulated depreciation, depletion, amortisation and impairment losses	(742,195)	(702,829)	(39,366)	(702,392)	(661,177)	(41,215)
Net capitalised costs	237,480	235,914	1,566	274,080	271,787	2,293
Equity method investments
Share of net capitalised costs of associates and joint ventures	5,843	-	5,843	5,743	-	5,743
Total of the Group's and its equity method investments' net capitalised costs	243,323	235,914	7,409	279,823	271,787	8,036

	2020 RMB million	2019 RMB million
	Total	China	Other countries	Total	China	Other countries
The Group
Exploration	16,752	16,752	-	16,295	16,295	-
Development	38,241	37,636	605	37,412	37,245	167
Total costs incurred	54,993	54,388	605	53,707	53,540	167
Equity method investments
Share of costs of exploration and development ofassociates and joint ventures	100	-	100	747	-	747
Total of the Group's and its equity method investments' exploration and development costs	55,093	54,388	705	54,454	53,540	914

	2020 RMB million	2019 RMB million
	Total	China	Other countries	Total	China	Other countries
The Group
Revenues
Sales	52,354	52,354	-	59,552	59,262	290
Transfers	58,069	56,052	2,017	83,633	80,641	2,992
	110,423	108,406	2,017	143,185	139,903	3,282
Production costs excluding taxes	(44,595)	(43,487)	(1,108)	(47,969)	(46,725)	(1,244)
Exploration expenses	(9,716)	(9,716)	-	(10,510)	(10,510)	-
Depreciation, depletion, amortisation and impairment losses	(52,608)	(51,754)	(854)	(48,630)	(47,580)	(1,050)
Taxes other than income tax	(7,379)	(7,379)	-	(9,395)	(9,395)	-
Profit before taxation	(3,875)	(3,930)	55	26,681	25,693	988
Income tax expense	188	-	188	338	-	338
Results of operation from producing activities	(3,687)	(3,930)	243	27,019	25,693	1,326
Equity method investments
Revenues
Sales	4,913	-	4,913	9,325	-	9,325
	4,913	-	4,913	9,325	-	9,325
Production costs excluding taxes	(998)	-	(998)	(2,516)	-	(2,516)
Exploration expenses	-	-	-	-	-	-
Depreciation, depletion, amortisation and impairment losses	(940)	-	(940)	(1,124)	-	(1,124)
Taxes other than income tax	(1,930)	-	(1,930)	(4,068)	-	(4,068)
Profit before taxation	1,045	-	1,045	1,617	-	1,617
Income tax expense	(303)	-	(303)	(486)	-	(486)
Share of profit for producing activities of associates and joint ventures	742	-	742	1,131	-	1,131
Total of the Group's and its equity method investments' results of operations for producing activities	(2,945)	(3,930)	985	28,150	25,693	2,457

	2020	2019
			Other			Other
	Total	China	countries	Total	China	countries
The Group
Proved developed and undeveloped reserves (oil) (million barrels)
Beginning of year	1,450	1,433	17	1,367	1,339	28
Revisions of previous estimates	(161)	(171)	10	81	85	(4)
Improved recovery	109	109	-	160	160	-
Extensions and discoveries	111	111	-	98	98	-
Production	(257)	(250)	(7)	(256)	(249)	(7)
End of year	1,252	1,232	20	1,450	1,433	17
Non-controlling interest in proved developed and undeveloped reserves at the end of year	5	-	5	8	-	8
Proved developed reserves
Beginning of year	1,343	1,326	17	1,271	1,244	27
End of year	1,145	1,130	15	1,343	1,326	17
Proved undeveloped reserves
Beginning of year	107	107	-	96	95	1
End of year	107	102	5	107	107	-
Proved developed and undeveloped reserves (gas) (billion cubic feet)
Beginning of year	7,216	7,216	-	6,793	6,793	-
Revisions of previous estimates	171	171	-	123	123	-
Improved recovery	692	692	-	469	469	-
Extensions and discoveries	1,171	1,171	-	875	875	-
Production	(1,069)	(1,069)	-	(1,044)	(1,044)	-
End of year	8,181	8,181	-	7,216	7,216	-
Proved developed reserves
Beginning of year	6,026	6,026	-	5,822	5,822	-
End of year	6,357	6,357	-	6,026	6,026	-
Proved undeveloped reserves
Beginning of year	1,190	1,190	-	971	971	-
End of year	1,824	1,824	-	1,190	1,190	-

	2020	2019
			Other			Other
	Total	China	countries	Total	China	countries
Equity method investments
Proved developed and undeveloped reserves of associates and joint ventures (oil) (million barrels)
Beginning of year	290	-	290	299	-	299
Revisions of previous estimates	13	-	13	(8)	-	(8)
Improved recovery	-	-	-	2	-	2
Extensions and discoveries	11	-	11	25	-	25
Production	(24)	-	(24)	(28)	-	(28)
End of year	290	-	290	290	-	290
Proved developed reserves
Beginning of year	245	-	245	261	-	261
End of year	244	-	244	245	-	245
Proved undeveloped reserves
Beginning of year	45	-	45	38	-	38
End of year	46	-	46	45	-	45
Proved developed and undeveloped reserves of associates and joint ventures (gas) (billion cubic feet)
Beginning of year	9	-	9	13	-	13
Revisions of previous estimates	4	-	4	(1)	-	(1)
Improved recovery	-	-	-	-	-	-
Extensions and discoveries	-	-	-	-	-	-
Production	(3)	-	(3)	(3)	-	(3)
End of year	10	-	10	9	-	9
Proved developed reserves
Beginning of year	9	-	9	13	-	13
End of year	8	-	8	9	-	9
Proved undeveloped reserves
Beginning of year	-	-	-	-	-	-
End of year	2	-	2	-	-	-
Total of the Group and its equity method investments
Proved developed and undeveloped reserves (oil) (million barrels)
Beginning of year	1,740	1,433	307	1,666	1,339	327
End of year	1,542	1,232	310	1,740	1,433	307
Proved developed and undeveloped reserves (gas) (billion cubic feet)
Beginning of year	7,225	7,216	9	6,806	6,793	13
End of year	8,191	8,181	10	7,225	7,216	9

	2020 RMB million	2019 RMB million
	Total	China	Other countries	Total	China	Other countries
The Group
Future cash flows	595,159	589,659	5,500	869,402	856,037	13,365
Future production costs	(275,409)	(271,824)	(3,585)	(384,417)	(377,692)	(6,725)
Future development costs	(27,028)	(23,902)	(3,126)	(27,065)	(22,216)	(4,849)
Future income tax expenses	(11,758)	(10,521)	(1,237)	(40,720)	(39,634)	(1,086)
Undiscounted future net cash flows	280,964	283,412	(2,448)	417,200	416,495	705
10% annual discount for estimated timing of cash flows	(87,579)	(86,127)	(1,452)	(126,203)	(126,175)	(28)
Standardised measure of discounted future net cash flows	193,385	197,285	(3,900)	290,997	290,320	677
Discounted future net cash flows attributable to non-controlling interests	(1,284)	-	(1,284)	305	-	305
Equity method investments
Future cash flows	31,259	-	31,259	41,796	-	41,796
Future production costs	(13,050)	-	(13,050)	(13,141)	-	(13,141)
Future development costs	(5,712)	-	(5,712)	(5,603)	-	(5,603)
Future income tax expenses	(1,740)	-	(1,740)	(3,995)	-	(3,995)
Undiscounted future net cash flows	10,757	-	10,757	19,057	-	19,057
10% annual discount for estimated timing of cash flows	(4,828)	-	(4,828)	(8,852)	-	(8,852)
Standardised measure of discounted future net cash flows	5,929	-	5,929	10,205	-	10,205
Total of the Group's and its equity method investments' results of standardised measure of discounted future net cash flows	199,314	197,285	2,029	301,202	290,320	10,882

	2020	2019
	RMB million	RMB million
The Group
Sales and transfers of oil and gas produced, net of production costs	(58,449)	(85,821)
Net changes in prices and production costs	(122,641)	(25,442)
Net changes in estimated future development cost	(7,912)	(10,108)
Net changes due to extensions, discoveries and improved recoveries	44,602	61,465
Revisions of previous quantity estimates	(11,211)	12,995
Previously estimated development costs incurred during the year	6,684	9,737
Accretion of discount	31,940	32,407
Net changes in income taxes	19,375	1,547
Net changes for the year	(97,612)	(3,220)
Equity method investments
Sales and transfers of oil and gas produced, net of production costs	(1,984)	(2,741)
Net changes in prices and production costs	(5,190)	(2,804)
Net changes in estimated future development cost	(299)	(881)
Net changes due to extensions, discoveries and improved recoveries	369	1,321
Revisions of previous quantity estimates	437	(423)
Previously estimated development costs incurred during the year	232	355
Accretion of discount	979	1,438
Net changes in income taxes	1,180	701
Net changes for the year	(4,276)	(3,034)
Total of the Group's and its equity method investments' results of net changes for the year	(101,888)	(6,254)

Postcode	:	100728
Tel.	:	86-10-59960028
Fax	:	86-10-59960386
Website	:	http://www.sinopec.com
E-mail addresses	:	[email protected]

Stock name	:	SINOPEC CORP
Stock code	:	600028

Stock code

:

00386

Stock code

:

SNP

Stock code

:

SNP

Domestic Auditors	:	PricewaterhouseCoopers
		Zhong Tian LLP
Address	:	11th Floor
		PricewaterhouseCoopers,
		2 Corporate Avenue,
		202 Hu Bin Road,
		Huangpu District,
		Shanghai, PRC 200021
Overseas Auditors	:	PricewaterhouseCoopers
Address	:	22nd Floor,
		Prince's Building,
		Central, Hong Kong

DOCUMENTS FOR INSPECTION The following documents will be available for inspection during normal business hours after 26 March 2021 at the registered address of Sinopec Corp. upon requests by the relevant regulatory authorities and shareholders in accordance with the Articles of Association and the laws and regulations of PRC: a) The original copies of the 2020 annual report signed by Mr. Zhang Yuzhuo, the Chairman of the Board of Directors; b) The original copies of financial statements and consolidated financial statements as of 31 December 2020 prepared under IFRS and CASs, respectively, signed by Mr. Zhang Yuzhuo, the Chairman of the Board of Directors, Mr. Ma Yongsheng, the President, and Ms. Shou Donghua, the Chief Financial Officer and head of the Financial Department of Sinopec Corp.; c) The original auditors' reports signed by the auditors; and d) Copies of the documents and announcements that Sinopec Corp. has published in the newspapers designated by the CSRC during the reporting period. By Order of the Board Zhang Yuzhuo Chairman Beijing, PRC, 26 March 2021 If there is any inconsistency between the Chinese and English versions of this annual report, the Chinese version shall prevail.