Dear Shareholders and Friends:

In 2022, the Company encountered complicated, fickle and severe conditions, including global economic slowdown, geopolitical conflicts and weak domestic market demand. We completely, accurately and comprehensively implemented new development concept, carried out the world’s leading development strategy, and made relentless efforts to stabilize operations and to expand market reach. Remarkable results were achieved in all aspects of work through our initiatives to drive innovation, business development and reform in conjunction with enhanced management and risk control. In accordance with IFRS, the Company’s turnover for the year was RMB3.32 trillion. Profit attributable to equity shareholders of the Company was RMB66.2 billion. The liability-to-asset ratio as of the end of the year was 51.95%. In view of the Company’s profitability, shareholder returns and sustainable development in the future, the board of directors recommended the distribution of a final dividend of RMB0.195 per share (tax included). Taking into account the interim dividend of RMB0.16 per share (tax included), the total dividend for the year was RMB0.355 per share (tax included), which, together with the amount of share repurchase during the year, resulted in a dividend payout ratio of 71% for 2022.

Over the past year, the Company’s corporate governance were further enhanced. With an aim of strengthening strategic planning, the board of directors reviewed and approved of the Company’s medium and long-term development plan. Our ADR were delisted in an orderly manner. Our debut share buyback program since our listing was well implemented to repurchase our A-shares and H-shares in order to advocate the Company’s fair valuation. All independent directors executed their duties and reviewed all resolutions with diligence. They carried out thematic site surveys on technology innovation and offered valuable suggestions for our reform and development. The Company revised a number of governance rules to reinforce the corporate governance. As the internal control system was further improved, its implementation turned more effective. Meanwhile, the Company maintained sound information disclosure and investor relations management. As a result, we have been awarded Grade A rating of information disclosure by the Shanghai Stock Exchange for nine consecutive years. We attached great importance to the incorporation of Party building into the corporate development, resulting in effective implementation of the decisions and strategies made by the board of directors.

Over the past year, significant progress was made in the Company’s high-quality development. As for the upstream business, we vigorously expanded the resource base and proactively increased our reserves and output. Major breakthroughs were made in the exploration of shale oil fields in East China and ultra-deep fields in West China. The domestic oil and gas reserve replacement ratio reached 165%. As for refining operation, we stepped up efforts in the development of competitive production facilities, steadily promoted adjustment to increase the yield of chemical feedstock and refining specialties. Development of the Zhenhai refining project, the Hainan ethylene project and the Gulei refining and chemical integrated complex progressed smoothly. The sales network of refined oil products was further optimized. We accelerated the transformation towards an integrated energy service provider of “petrol, gas, hydrogen, power and services”. New progress was made in the development of “Industrial Internet+” and the digital and smart transformation. At the same time, the Company promoted the development of hydrogen energy, photovoltaics, and battery charging and swapping businesses. The first CCUS project with capacity of 1 million tonnes in China was completed and put into operation. Sinopec Carbon Industry Technology Co., Ltd., the first company in China with complete value chain for carbon industry was established. Positive results were achieved in the promotion of transition to low-carbon energy development.

Over the past year, the Company’s production and operation were further improved. In the face of weak demand, the downward cycle of the chemical industry and dramatic fluctuations in product prices, we adhered to efficiencycentered, market-oriented approach and continuously improved the business operations. As for the upstream business, the Company strengthened cost control, and domestic oil and gas production hit a record high, achieving the best profit level since 2016. Regarding the refining business, we focused on trade, storage and transportation, and production coordination, closely monitored the market development to better coordinate resources, optimized operations, and reinforced the competitive edge of our industrial chain. As for the chemicals business, we optimized the structure of feedstocks, plants and products slates, promoting the integration of production, marketing, as well as research and application. The proportion of three high value-added synthetic material products steadily increased. Meanwhile, the quality and efficiency of the coal chemical operations were further improved. We gave full play to the integration advantages of refined oil marketing business, expanded the market reach with high-quality services. Nonfuel business maintained steady growth and its overall profitability realized a stable growth.

Over the past year, the Company’s science and technology innovation competitiveness continued to improve. We deepened the reform of science and technology mechanism to motivate the R&D team, stepped up the investment on R&D, pushed for breakthroughs in core technology development, and enhanced the frontier fundamental research. Significant achievements were made in technology innovation, along with new progress in the development of core technologies relating to the exploration and development of ultra-deep oil and gas reservoir, the geology and engineering integration of shale oil and gas fields, as well as specialty rubber products. In addition, major breakthroughs were made in a number of key technologies such as high-isotactic polybutene-1. The number of patents authorized both at home and abroad reached a new high during the year. The Company’s comprehensive patent advantages continued to rank at the forefront of stateowned enterprises. Our competence to support and lead scientific and technological innovation continued to improve.

Over the past year, our ESG efforts achieved solid results. The board of directors attached great importance to ESG, focused on incorporating ESG into strategic management, strengthened top-level design and the foundation of management, enhanced ESG communication and disclosure. As a result, the Company’s ESG performance has been acknowledged by the capital market. We actively responded to global climate change initiative by implementing the plan to achieve carbon peak by 2030, launched the campaign to prevent and control pollution, vigorously developed clean energy, and contributed our efforts to the construction of ecological civilization. Relentless efforts were made to safeguard the energy supply and to maintain the stability of the industrial and supply chains. The Company actively explored the model of assisting in rural revitalization, such as driving industrial development through sales, revitalized rural areas through industrial development, and promoted growth through education. We offered full-fledged support to Beijing Winter Olympics and the Winter Paralympics, pushed forward our charity programs such as the “Spring Blossom Filling Station Project”, and continued to promote the coordinated local development of economy, environment and the society in China and overseas so that the development results benefit more people.

At present, the instability and uncertainty of global environment are increasing significantly, leading to intensified market competition in the energy and chemical industry. But the fundamentals of the Chinese economy, characterized by strong resilience, enormous and long-term potential, sustainability, remain unchanged. The government prioritizes the task to resume and expand domestic consumption. Therefore, the Company is poised to benefit from valuable strategic opportunities for highquality development. Setting off from a new development stage, Sinopec Corp. will initiate the high-quality development plan driven by the strategy of building a world-class enterprise, focusing on “excellent products, outstanding brands, leading innovation capability and advanced governance”. We will steadily promote the corporate upgrading from size expansion to strong competitiveness and then ascending to excellence, striving to achieve better quality, higher efficiency, greater competitiveness and influence.

In 2023, we will seize the favorable opportunity arising from steady development of domestic economy and the recovery of demand for petroleum and petrochemical products, insist on driving growth in a stable manner, and strive to achieve effective quality improvement in different businesses and reasonable volume growth. At the same time, we will accelerate the process of building ourselves towards a world-class enterprise, whereby leading the Company to a new stage of high-quality development. We will pay more attention to bringing the benefits of our integrated operation into full play, improving the business operations, and enhancing the synergies and efficiency resulted from our complete industrial chain. We will attach greater importance to business transition and upgrading, the promotion of digital transformation and intelligentization, strive to build green and lowcarbon competitiveness, step up efforts to drive science and technology innovation and inspire the creativity from innovation, and accelerate the breakthroughs in core technologies in exploration and development, specialty oil products, chemical materials and new energy and other fields to enhance the driving force of science and technology innovation. We will pay more attention to the incorporation of ESG into our development strategy, deepen reform and improve governance, unleash the dynamism of our system and mechanism, consolidate our foundation, keep the risks under control and further enhance our corporate governance to a new level.

For the upstream business, we will focus on consolidating the resource base, make every effort to increase the reserves, stabilize oil output, boost gas production and reduce costs, and promote profitable exploration of crude oil and profitable production of natural gas, shift the refined oil products to chemical feedstock and refining specialities, expedite the production facility structure adjustments and the development of competitive production capacities. As for the chemicals business, we will adhere to the “basic + high-end” approach, strengthen the integrated management of production, marketing, research and application for high value-added products to enhance the product competitiveness, and cultivate the new advantage of high-quality development. For the marketing business, we will promote innovative business model, develop new energy terminals, and strive for new achievements in developing ourselves as a “petrol, gas, hydrogen, power and services” provider. The Company will continue to maintain a solid financial position, strengthen cash flow management, continuously optimize the capital structure, and improve the efficiency of capital fund utilization. In 2023, the Company’s planned capital expenditure will be RMB165.8 billion.

For the upstream business, we will focus on consolidating the resource base, make every effort to increase the reserves, stabilize oil output, boost gas production and reduce costs, and promote profitable exploration of crude oil and profitable production of natural gas, shift the refined oil products to chemical feedstock and refining specialities, expedite the production facility structure adjustments and the development of competitive production capacities. As for the chemicals business, we will adhere to the “basic + high-end” approach, strengthen the integrated management of production, marketing, research and application for high value-added products to enhance the product competitiveness, and cultivate the new advantage of high-quality development. For the marketing business, we will promote innovative business model, develop new energy terminals, and strive for new achievements in developing ourselves as a “petrol, gas, hydrogen, power and services” provider. The Company will continue to maintain a solid financial position, strengthen cash flow management, continuously optimize the capital structure, and improve the efficiency of capital fund utilization. In 2023, the Company’s planned capital expenditure will be RMB165.8 billion.

In the new year, we will strive for excellence and spare no effort to forge ourselves towards a world class enterprise. Relentless efforts will be made to write a new chapter of Sinopec’s highquality development, whereby creating greater value for shareholders and the society.

Ma Yongsheng

Chairman

Beijing, China 24 March 2023