2018 Sinopec Corp.

Communication on Progress
for Sustainable Development
New Era 丨 New Opportunities 丨 New Growth Drivers
 Contents

Report Information 02 Letter from the Chairman 12 Topic 1

Green Enterprise Campaign
18 Topic 3
Intelligent Operation
04 About Us

09 Stakeholder Engagement
14 Topic 2 20 Topic 4
The 2018 Communication on Progress for Sustainable Development (hereinafter referred to "COP") Green Energy and Products Targeted Poverty Alleviation
is the thirteenth sustainability report from China Petroleum & Chemical Corporation (hereinafter
11 Sustainability Management
referred to as "Sinopec Corp.", "the Company" or "We"). The theme of this year's COP is New Era, System
New Opportunities, New Growth Drivers. The COP introduces our efforts promoting economic growth,
social development and environmental protection, and highlights how we responded to stakeholder
expectations in 2018.

Report description 22 28 36
This COP covers our business activities from 1 January to 31 December 2018. The information herein Safety Climate Change Environment
comes from internal data, materials from our subsidiaries, and official documents and statistics. Unless
the COP otherwise requires, the data in this report covers the data of Sinopec Corp. and its wholly- 24 Work Safety 30 Climate-Related Risks 38 Environment-Related Risks
owned and controlled subsidiaries. The Company's Board of Directors approved the Report on March 25 Contractor Safety 31 Improving Energy Efficiency 39 Air Emissions
22, 2019. The report is available in Chinese and English. If there is any conflict or inconsistency, the
26 Logistics Safety 32 Natural Gas 40 Water Resources
Chinese version shall prevail. The report can be downloaded at the website: http://www.sinopec.com/
listco/en/csr/. 26 Cyber Security 32 Using Alternative Energy Sources 41 Solid Waste

26 Public Security 34 GHG Emission Management 42 Land Resources

References
This COP is prepared in accordance with Ten Principles of the United Nations Global Compact 42 Oil Spills

(UNGC), the criteria of the Global Compact Advanced Communication on Progress, the Guideline on 43 Biodiversity
Environmental Information Disclosure issued by Listed Companies of Shanghai Stock Exchange (SSE),
as well as the Environmental, Social and Governance Reporting Guide issued by Hong Kong Stock

44 52 56
Exchange (HKEx) and by reference to the GRI Sustainability Reporting Standards (GRI Standards)
issued by the GRI Global Sustainability Standards Board (GSSB).

Disclaimer Contributing to Society Human Rights Ethics

This COP includes certain forward-looking statements with respect to the results of our business 46 Value Chain Management 54 Employee Protection 58 Anti-corruption System
operations and certain plans and conditions. All statements that address activities, events or
48 Advancing Win-Win Cooperation with 54 Occupational Health 58 Transparent Operation
developments that we expect will or may occur in the future, other than statements of historical fact,
Customers
are forward-looking statements and by their nature involve risk and uncertainty. This means that actual 55 Career Development 59 Enhancing Anti-corruption Awareness
results may differ materially from those indicated in the forward-looking statement due to a number 50 Promoting Industry Development

of factors and uncertainties. The forward-looking statements are made by March 22, 2019 and the 50 Community Engagement
Company undertakes no obligation to update these forward-looking statements unless required by an
51 Public Welfare
appropriate regulatory authority.

61 Key Performance

65 Index

70 Feedback
02 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Letter from the Chairman 03

Letter from the Chairman

Dear friends,

On behalf of the Board of Sinopec Corp., I philosophy, addressed the identified risks and Firmly advancing green development to investment, speeding up the development of Yuexi County, Anhui Province, passed through
would like to extend our heartfelt thanks for achieved solid business performance. In 2018, embrace new opportunities. We implemented pivotal core technologies and advancing the national evaluation and inspection, which
your attention and support. the revenue of the Company reached RMB 2.89 Green and Low-carbon Development Strategy R&D of cutting-edge technologies, we have means that the county with 400,000 populations
trillion with profits before taxation of RMB 100.5 and continued to address climate change. We achieved fruitful results. In 2018, we received 1 was lifted out of poverty. We continued to
In a complicated international environment undertake public welfare programmes such
billion. The Company paid RMB 324.6 billion of set up the goal of greenhouse gas emission second prize of National Technology Invention
of 2018, collective efforts were made to as Sinopec Lifeline Express, Warm Stations
taxes and fees. We provided green and high- reduction, deployed the Energy Efficiency Award and 3 second prizes of National Science
promote the United Nations 2030 Agenda Programme, Sanitation Workers' Stations
quality products to society and helped achieve Improvement Plan, and conducted evaluations and Technology Progress Award, with the
for Sustainable Development focusing on Programme and Farmer Assistant Programmes
sharing growth between employees and the on energy efficiency and carbon emissions. numbers of applied patents and authorised
addressing climate change, eradicating poverty in Autumns and Summers, took part in disaster
Company and ensure harmony between the We set up the mid and long term development patents hitting historic highs. We, focusing on
and revitalising global cooperation partnership relief, provided grants or scholarships to
Company and the society. goals of natural gas sector and optimised the promoting green and low-carbon development
etc., and to explore a sustainable development students in poverty and helped the communities
natural gas supply, storage and distributions of energy resources and propelling the
path for human society. Adhering to the new Fostering new growth drivers to contribute
system. We continuously conducted carbon functional and high-end development of in need, receiving acclaims from the society.
development philosophy, China promoted to sustainable development. Focusing on
capture and methane recovery, completed chemicals and materials, strengthened the For overseas projects, we fulfilled our social
the supply-side structural reform, fulfilled the upgrading the traditional industries, we
quality upgrading of refined oil product in efforts on the areas of new energies and new responsibilities to benefited local communities
responsibilities of advancing the construction enhanced oil and gas exploration with improved
advance and promoted development of materials. We implemented Open Corporation by localised employment and procurement,
of ecological civilisation, expanding opening- oil and gas reserve replacement ratio, made
alternative energy sources such as bio-jet fuel, Strategy. By joining the global innovation promoting local economy, and advocating
up at high level and maintaining sustainable new progress in refining and chemicals bases
biodiesel and photovoltaic power. We stepped network, participating in industry standards environmental protection, which manifested the
and healthy development of the society, which construction and facilities upgrading, optimised
up our efforts on environmental protection. By formulation, cooperating to develop the new responsible image of a global corporate citizen.
injected new growth drivers to economic the market network and the global trade
conducting special environmental supervision materials essential to the industry development
globalisation. network with the result that the market share In a new era full of opportunities, it is right time
and inspection, and promoting implementation as well as the technologies on energy efficiency
was consolidated and increased. We further for us to take actions. Upholding the philosophy
As a provider of energy and petrochemical of ecological protection measures, we made and environmental protection, we contributed
integrated the physical economy with the of building a community of shared future for
products and also the witness, contributor, new achievements in the reduction of pollutant Sinopec's wisdom to the industry with solutions
digital economy by spreading intelligent plants, mankind, we will keep pace with the trend of the
promoter and beneficiary of global discharges and the protection of water of sustainable development.
intelligent oil and gas fields and intelligent times demanding peace, cooperation, opening-
development, Sinopec Corp. has been resources and biodiversity. We strengthened
service stations. The business platforms such Corporate development benefiting employees up, transformation and innovation, remain true
dedicated to building itself as a long-lasting our efforts on safety management. By
as EPEC, Sinopec Chememall and EasyJoy and improving people's wellbeing. Inheriting to our mission of sustainable development and
energy and chemicals enterprise and making conducting safety risks identification, optimising
achieved rapid progress. The volume and the the people-oriented philosophy, we conducted join hands with you in this new era for powering
contributions to the sustainable development of and launching HSSE management system,
profit of non-fuel business maintained fast the integrated management of employees' a better life.
society. In 2018, the Board of Directors finalised strengthening contractor safety control and
growth. In addition, we advanced the building occupational health, physical health and
the strategic deployment of "two three-year the domestic and overseas public security
of new energy comprehensive demonstration mental health, building up a comprehensive
plans and two ten-year plans", set up phased management, we realised work safety and
stations and constructed the hydrogen refueling health management system. We enhanced
objectives, formulated and implemented action clean production throughout the year.
stations and charging stations orderly and the construction of diversified talent teams,
plans which inaugurated a new journey to
stepped up efforts on the layout of the strategic Strengthening innovation-driven development promoted decent work to raise employees'
achieve high-quality development and build a
industries including new energies and new to generate vitality. We implemented the senses of achievement, happiness and
world-class enterprise. Throughout the year, Dai Houliang
materials. Innovation-driven Development Strategy. security. Moreover, we took actions to facilitate
the Company adhered to the new development Chairman
By deepening the reform on technology the targeted poverty alleviation. In 2018, the
March 22, 2019
mechanism, continuously increasing the R&D poverty alleviation project of Sinopec Corp. in
04 Sinopec Corp. Communication on Progress for Sustainable Development 2018 About Us 05

About Us
Company Profile Core Values

Exploration Marketing and

Refining People Responsibility
and Production Distribution

• Sinopec Corp. is a large oil and gas • Sinopec Corp. ranks first in global • Sinopec Corp. is the largest refined
producer in China. refining capacity. oil distributor in China.
Collaboration
Core Integrity
• Our main oil and gas assets are • Our primary facilities are located in • Sinopec Corp. is equipped with Values
located in China and we also jointly China and we invest a refining joint comprehensive refined oil products
participate in four projects overseas venture project in Yanbu, Saudi distribution network, with the number
named Taihu in Russia, Block 18 Arabia. of service stations ranking second in
in Angola, CIR in Kazakhstan and • In 2018, we processed 244 million the world.
Mansarovar in Colombia respectively. tonnes of crude oil. • At the end of 2018, 30,661 service
Innovation Excellence
• At the end of 2018, our proven oil and stations carried the Sinopec logo, and
natural gas reserves totaled 1,667 the total number of fuel cards reached
million barrels and 6,807 billion cubic 146 million.
feet respectively. • Non-fuel business becomes a new
growth driver.

Sinopec Corp. fulfills its responsibilities as a global corporate citizen by conducting business that
serves society. We integrate a people-oriented approach to corporate culture and practices.

Technology International Our diversified portfolio, including energy resources such as crude oil and natural gas, refined oil
Chemicals R&D Trade products such as gasoline, diesel and kerosene, and petrochemical products with thousands of
varieties, contributes to social and economic development and satisfies hundreds of millions of families.

We operate honestly and pay taxes in accordance with the law to contribute to national revenue and
• Sinopec Corp. is the first in China • Sinopec Corp. has the capacity and • Sinopec Corp. is the largest trader of boost social development and prosperity.

and the second globally in ethylene technology to build refining facilities crude oil in China. We commit to realising sustainable development of the Company and upholding stable and continuous
production capacity. at the ten-million tonnage level, • In 2018, we imported 217 million dividend pay-out policy to return to shareholders.
• Our main petrochemical products and ethylene facilities at the million tonnes of crude oil.
We focus on leading and cooperating with our partners along the upstream and downstream industrial
include synthetic resin, synthetic fibre tonnage level. • Sinopec Corp. owns 13 wharfs of
chain, aiming to enhance sustainability and achieve win-win results.
and synthetic rubber. We invest a joint • We have 4 State Key Laboratories, more than 200,000 DWT, with a total
venture project in Russia. 5 National Engineering Research capacity of 340 million tonnes. We guarantee employee rights, provide good working environment and optimise career development
• We produced 11.51 million tonnes of Centres, 2 National Energy R&D channels that show respect for our employees and promote decent work.
ethylene in 2018. (Experiment) Centres and 2 State- We engage in local communities by safeguarding community safety, protecting the environment,
Certified Enterprise Technology participating in local economic development projects, carrying out poverty alleviation programmes and
Centres. sharing our corporate development with local residents.
06 Sinopec Corp. Communication on Progress for Sustainable Development 2018 About Us 07

Performance in 2018

Social contributions (RMB)** Total number of employees

Revenue (RMB) Net profits attributable to

2,891.2
shareholders (RMB)*
480.2 423,543
63.09
billion
billion
billion

Ethics training coverage Safety training coverage

Taxes and fees paid (RMB) Donations (RMB)

100 % 100 %

324.6 billion 180 million

Patients cured under Sinopec Lifeline Express Programme

3,456 Sinopec Lifeline Express Sinopec Lifeline Express

Dividends declared (RMB) Dividends pay-out ratio*

600 18
50.85 80.60
thousand thousand

billion % People helped under People helped under

Warm Stations Sanitation Workers'
Programme Stations Programme

* In accordance with PRC Acccounting Standards for Business Enterprises.

** The definition of social contribution is calculated in accordance with the Guidelines on Listed Companies' Environmental Information Disclosure issued by
Shanghai Stock Exchange.
08 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Stakeholder Engagement 09

Stakeholder Engagement
2018 Honours
The trust and support of our stakeholders is a fundamental approach of • Through daily communication, visits, interviews and surveys with
Sinopec Corp. to sustainable development. We make progress through customers, we communicated the material issues including product
our partnerships with all stakeholders to jointly promote a sustainable quality and service.
Sinopec Corp. was named Most
development based on economic growth, protecting the environment and
Honoured Enterprise in Asia 2018, • Through face-to-face communication with NGOs and rating agencies as
building a harmonious society.
and Dai Houliang, Chairman of well as questionnaires, we communicated the material issues including
Sinopec Corp., ranked 1st in overall We have established a communication mechanism with our stakeholders. risk management, human rights, safety, environmental protection,
rating of Asia's Best CEOs by greenhouse gas emission and anti-corruption.
Institutional Investor Magazine. • Through continued communications, discussions and reports with
Sinopec Corp. received Award for Sinopec Corp. was named Chinese authorities, we communicated the material issues including tax paying, • Through Open-day activities, we communicated the material issues
Listed Company with Outstanding Model of Low Carbon Performance innovation, safety, ecological protection, targeted poverty alleviation and including protection of community residents' rights and communication.
Contributions During the 40 Years and Responsible Enterprise by information disclosure.
since China's Reform and Opening- China News Service and China We mapped our business operations with United Nation's 17 Sustainable
up. Newsweek for 8 consecutive years. • Through legal information disclosure, performance conferences, Development Goals (SDGs), and enhanced communication with
meetings with investors, teleconferences, online interaction, and the stakeholders who concern climate-related financial disclosures and
E-platform of SSE, we communicated the material issues including risks analysed the Company's climate related risks and opportunities.
and opportunities in sustainable development, shareholder returns,
addressing climate change and energy efficiency improvement.

Sinopec Corp. received "Social

Sinopec Corp. received Special
Responsibility Award for Overseas
Contribution Award from Lifeline
Investment of Chinese Enterprises
Express Council for the 14th
2018" by China Overseas
consecutive years. Sustainable development management P11 GHG management P30-35
Development Association.

Risk management P11 Pollutant discharge P39-41

Technological innovation P14-19 Biodiversity P43

Anti-corruption P58-59 Occupational health P54

Sinopec Corp. received Level-A
Sinopec Corp. received Targeted Product quality and service P48-49 Human rights protection P52-55
rating in the SSE's 2017-2018
Poverty Alleviation Award from
information disclosure assessment Shareholder returns P06 Social contribution P20-21, P50-51
XINHUANET.
of listed companies.
Work safety P22-27
10 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Sustainability Management System 11

SDGs Mapping Table*

Sustainability Management System
SDGs Our actions SDGs Our actions
Social Responsibility Management Committee
Supporting targeted poverty alleviation by investing RMB 228 Launching projects to develop local industry according to the
Sinopec Corp. established Social Responsibility Management Committee under the Board of Directors. The Committee is responsible for approving the social
million in poverty-stricken areas and Yuexi County with 400,000 natural resources of rural areas, such as planting and breeding
populations, in Anhui Province under our support is lifted out of industry, improving infrastructure construction and enhancing responsibility management strategy and annual social responsibility plan, and reports sustainability works to the Board of Directors etc. The current Committee
poverty. the agricultural production capacity.
is composed of the Chairman of the Board, Mr. Dai Houliang, and the independent directors, Mr. Tang Min and Mr. Fan Gang.

Guaranteeing the occupational health, physical health and Providing vocational skills training for employees and the
mental health of employees; deploying programmes including communities; investing RMB 25.83 million of funds in education
Sinopec Lifeline Express, telemedicine, doctor training, to provide educational facilities, scholarship, grants and other Risk Management System HSSE Management System
hospital assistance etc. to improve the accessibility of medical support for poverty areas.
resources.
We have paid great attention to risks in the process of sustainable The Company released the standards of Safety, Environment and Health
Abiding by the principle of gender equality, establishing the Establishing the annual target of water consumption, improving development. The Audit Committee was set up under the Board of Directors Management System, and the subsidiaries formulated management
female employees' committee of the Labour Union, forbidding water use efficiency, strengthening waste water recycling and to review risk management work and provide advice for the Board. specifications in accordance with their characteristics. In 2018, we
gender discrimination in employment and promotions, and utilisation, and promoting enterprises to replace fresh water with
Moreover, we have established the Comprehensive Risk Management integrated public security into the management system to form Sinopec
caring for their physical and mental health. reclaimed municipal water and desalinated seawater.
Working Group and relevant departments are responsible for controlling HSSE (health, safety, security, environment) management system, and
and mitigating risks related to work safety, environmental protection, correspondingly revised rules covering safety accountability, safety
Developing natural gas, upgrading the quality of refined oil Boosting the local prosperity by investment, paying taxes, job climate change, finance, legal affairs, anti-corruption and overseas public behavior, safety training, risk management as well as hidden hazards
products by technological innovation, and developing green creation and localised purchasing, and providing stable job
and high-performance chemical products to provide clean and opportunities, stable income and better working environment security. The Comprehensive Risk Management Working Group convenes management, operations and occupational health. We have established
affordable energy and materials. for employees; helping employees to find new job opportunities meetings regularly to organise identification, and assessment of major the HSSE Management Committee. The headquarters and the subsidiaries
after some subsidiaries suspend operations. and significant risks, identify priorities of risk management, and formulate have respectively set up HSSE management organisations.
solutions.
Increasing investment in R&D, strengthening R&D in the fields of Prohibiting child labour and forced labour, and any form of We have regarded work safety, energy conservation and environmental
new energy and new materials and promoting clean technologies discrimination due to gender, region, religion belief, nationality,
According to the industry characteristics and regional distributions, we protection as the binding indicators for performance appraisal of the
and facilities; actively engaging in industry standards formulation to etc; providing various social insurances and establishing
provide solutions for green development of the industry. enterprise annuity plan for employees. have set up risk list from five dimensions including strategy, finance, Company's management team. Each deduction of one grade point shall
market, operation and legislation etc., and put the internal control system lead to 3% deduction of the annual performance bonus, with the maximum
into risk list so as to conduct "Three Lines of Defence", namely regular test of 20%. The Company sets up GHG emission reduction target and includes
Renovating dilapidated houses for people in poverty and Highly valuing environmental protection and launching the of internal control responding units, daily supervision by risk/internal control the energy efficiency appraisal as well as the carbon emission appraisal
improving transportation conditions in remote areas; maximising Green Enterprise Campaign as a spearhead; promoting
professional advantage to help local communities in case of fire responsible production by disposing wastewater, exhaust gas departments and comprehensive auditing and inspection. We attach great into the project evaluation.
of hazardous chemicals or oil spilling incidents caused by the and waste residue, effectively as well as efficiently utilising the importance to building the risk management culture, and organise risk
third parties. natural resources such as land, water and petroleum. management training annually. Subsidiaries adopt the combination of Based on the HSSE management system, we have established an
special training and professional training to raise employees' awareness of emergency management system covering work safety, environmental
Setting up the goal of GHG emission reduction; conducting evaluations Developing medium and low-alkali marine cylinder oil with the risk prevention and control. protection, information security and other aspects, and promoted the
on energy efficiency and carbon emissions; setting up the mid and long pollution discharge data reaching the international leading level establishment of emergency command centres in oilfield, refineries,
term development goals of natural gas; conducting carbon capture and and launching oil spills risk analysis and assessment to strictly
Safety risks, environmental risks, climate-related risks and corresponding distributions, engineering construction and other enterprises. Meanwhile,
methane recovery and promoting the development of alternative energy prevent the oil spills at sea.
sources such as bio-jet fuel, biodiesel and photovoltaic power. management measures are presented in relevant sections of the Report. our subsidiaries have established the joint emergency defense mechanism
with the local authorities and thus established 13 emergency joint defense
Enhancing the pre-evaluation and project appraisal, formulating Abiding by business ethics, promoting the visibility of the whole zones in different geographical regions, to integrate emergency resources
the ecological protection and restoration plans, and strictly process of commodity trading on EPEC and other e-commerce within the regions, and strengthen joint drills so as to make coordinated
managing the operation of construction and production links to platforms to build clean enterprises; establishing the Workers'
reduce the disturbance to the ecological environment, and to
efforts in emergency response to major accidents.
Congress system and implementing the principle of equal
protect biodiversity. consultation.

Enhancing international cooperation in oil and gas and

carrying out oil and gas exploration and development, refining Target of HSSE Zero casualty, zero pollution, zero accident
and chemicals cooperation in Russia, Angola, Kazakhstan,
Colombia and Saudi Arabia respectively; importing 217 million

Philosophy of HSSE
tonnes of crude oil in 2018.
Safety foremost, environmental protection prioritised, maintain employees'
*The details are presented in the relevant section of the Report. physical and mental health, preserve the characteristics of preciseness,
meticulousness and pragmatism
 12 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Topic 1 Green Enterprise Campaign 13

Targets of Green Energy Plan

• To improve the production capacity of
tonnes per year. By then, the natural gas supply • By 2023, 1,000 additional CNG stations
conventional natural gas, shale gas and coalbed
capacity will reach 60 billion m3 per year, for vehicles will be built. We will explore the
methane, and promote gas popularisation in
accounting for 15-20% of domestic supply. layout of battery charge & change stations
the Yangtze River Economic Belt. By 2023, the in key cities and road sections, and timely
• The quality of oil products maintains the
production capacity of natural gas will reach promote the construction of hydrogen stations
advanced international level. By October 2018,
over 40 billion m3 per year, and the percentage the gasoline and diesel produced by Sinopec and hydrogen storage infrastructure.
of clean energy production in oil equivalent will • In the construction of green service stations,
Corp. for vehicles will reach the National VI
exceed 50%. emission standard. In 2020, the sulfur content of we will increase the marketing and supply
• To build LNG receiving station and gas
marine fuel oils will decrease from 3.50% to of ethanol gasoline, biodiesel, gasoline

Topic 1 storage, etc. By 2023, the LNG receiving and

transportation capacity will reach 26 million
0.50%. cleaners.

Green Enterprise
Goals of Green Enterprise Campaign (2023)
Campaign
Clean
The percentage of clean energy production in oil equivalent will exceed 50 %.
energy
The natural gas supply capacity will reach 60 billion m3 per year, accounting for 15-20 % of domestic supply.

The Company attaches great importance to energy conservation, emission reduction and environmental protection. In 2011, we identified the green and low-carbon
development strategy as one of the development strategies. The "Clear Water and Blue Sky" environmental protection campaign implemented during the period from
Energy
conservation
6
To conserve million tonnes
of standard coals
12.6
reduction
million tonnes of CO2 planting 150
million trees
2014 to 2016 carried out 870 projects, with a total investment of RMB 20.92 billion. On this basis, we launched the Green Enterprise Campaign in 2018. The Campaign
adopts the vision of "contributing to clean energy, practising green development", advocates to supply clean energy and green products, enhances green production
and leads green development of the industry. We have formulated the Sinopec Green Enterprise Evaluation Guideline and established the specific working group. By
the end of 2018, 10 subsidiaries were awarded as Sinopec Green Enterprises.
Water
conservation
Reducing industrial water withdrawal by 46 million m3 water volume of 4 West Lakes in Hangzhou City

Discharge of industrial waste water

COD drop by 12 % Ammonia Nitrogen drop by 12 %

Green Enterprise Campaign consists of six major plans

Pollutant
discharge
drop by 12 %
reduction
VOCs drop by 12 % SO2 drop by 18 % NOX drop by 18 %

 Green Development Plan  Green Service Plan Note: All data are based on 2017 benchmark.
Including optimising production capacity layout, ensuring ecological Including expanding green chemical product portfolios, building green
security, adjusting industrial structure, and building green logistics, etc. service stations, developing energy conservation and environmental
protection industries, and building a green supply chain, etc. Case

 Green Energy Plan  Green Technology Plan

SINOPEC Zhenhai Sets up Goals of Green Enterprise
Including increasing clean energy supply, providing high-quality oil Focusing on breakthroughs in green production technology of Green products: To promote the supply of National VI oil products, ensuring to lead the industry with the supply of high-quality clean refined oil
products, and promoting new energy R&D, etc. petrochemicals, resource recycling technology, pollution treatment products; develop bio-jet fuel, biodegradable plastics and other green petrochemical products.
technology, and cutting-edge green technologies, etc. Comprehensive utilisation of resources: By 2020, the comprehensive energy consumption of refining sector will maintain the lowest level of peer
enterprises in China, and the comprehensive energy consumption of ethylene per unit will maintain the leading position in terms of industry's energy
 Green Production Plan  Green Culture Plan efficiency; the water consumption of existing equipment will be reduced by 1% per year.
Including source cleanliness, process cleanliness, maximal use of Including building a long-effect mechanism and fostering green culture, Pollutant emission reduction: By 2020, the total discharge of major pollutants will be reduced by more than 25%. The total discharge of all
resources and energy, efficient pollution control, and controllable etc. pollutants will meet the requirements of pollutant discharge permit, and the emission intensity will be in the industry-advanced position; the qualified
environmental risks, etc. rate of discharged waste water will be 100%; The qualified rate of controlled exhaust gas will be 99.8%; the proper disposal rate of hazardous waste
will be 100%; there will be no major or higher environmental pollution incidents.
14 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Topic 2 Green Energy and Products 15

High-quality green energy

China promotes the oil quality improvement technical support for the production of gasoline
as a way of reducing pollutant emissions and and diesel that meet the National VI emission TIPS
building a beautiful country. In recent years, standards. In October 2018, the gasoline and
Olefins is prone to photochemical
we have been accelerating our gasoline and diesel produced by all refining subsidiaries reactions, which accelerates ozone
diesel quality upgrading, ensuring to be at the for vehicles reached the National VI emission formation. It also tends to form gel
forefront of the industry with supply of high- standards; marketing subsidiaries strengthened and coke in the engine and engine
quality clean refined oil products. In 2018, we the oil replacement of the pipelines, oil depots intake system, reducing engine
efficiency and increasing vehicle
completed the development and industrial and service stations to ensure providing the
emissions.
Topic 2 transformation of the independently IPR
alkylate oil production technology, providing
refined oil with national VI quality by January 1,
2019.
Aromatics can increase the formation
of deposits in engine intake system

Green Energy and combustion chamber and lead to

increased CO and HC emissions.

and Products
0.8% 35% 15% 7%
National VI Emission Standard

1% 40% 24% 11%

National V Emission Standard
We rely on technological innovation to promote the upgrading of three major synthetic materials (synthetic resin, synthetic rubber, synthetic fibre)
and the R&D of new materials, develop fine chemicals and biochemicals in an orderly manner, and develop new eco-friendly and resource-saving Content of benzene Content of aromatics Content of olefins in Content of polycyclic aromatic
products, providing high-quality clean energy and petrochemical products for sustainable development of the society. in gasoline in gasoline gasoline hydrocarbon in diesel

Technological innovation system

In 2018, investment in The Innovation-driven Development is one authorised patents. We established a new
technological R&D (RMB ) of the five development strategies of the energy research institute and started project TIPS
National Technology Invention

12.88
Company. We pursue "promoting supply-side research on new energy, new materials and Dilute ethylene comes from the Award
added chemicals. Since the concentration

1
structural reform" as our main task and focus other fields. exhaust gas of refining & chemical
billion of effective components in dilute ethylene
on key tasks including oil & gas exploration facilities with the annual amount up
Three technologies including "Efficient Catalyst is low, and the composition of impurities is
and development, product structure to 19 million tonnes, equivalent to
and Complete Technology for Dilute Ethylene complex, it is necessary to break through
adjustment, and R&D of high-end chemical more than 2 million tonnes of pure
Obtained authorised patents Value-added Conversion" won the second a number of technical bottlenecks. After
products. At present, we have 4 State National Science and Technology
ethylene. Due to the high cost of decades of continuous innovation, Sinopec

4,434
prize of National Science and Technology Progress Award
Key Laboratories, 5 National Engineering refining and purifying it into pure

3
Progress Award. Our new structural molecular Corp. has achieved the breakthrough in the
Research Centres, 2 National Energy R&D ethylene, most enterprises use it as
sieve material obtained the structural code conversion of dilute ethylene to ethylbenzene.
(Experiment) Centres and 2 State-Certified a low-level fuel gas, causing serious
granted by the International Zeolite Association The technology has been licenced and applied
Enterprise Technology Centres. waste of resources. By catalytic
(IZA), realising the breakthrough in the field of to 21 manufacturing companies, and the
reaction, dilute ethylene can be overall technical indicators have reached the
In 2018, we invested about RMB 12.88 billion new structural zeolite synthesis by domestic
directly converted into high value- international leading level.
in technological R&D, and obtained 4,434 industrial enterprises.
16 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Topic 2 Green Energy and Products 17

Green and high-performance chemical products

The chemical products of Sinopec Corp. range from synthetic resins, synthetic rubber, synthetic fibres to refined chemical products. As the largest producer of In the field of lubricants
chemical products in China, we have carried out technology research and product development with the goal of providing safe, green and high-performance
products since 2006. In 2018, we focused on the "basic + high-end" combination to provide safer, greener and higher-performance chemical products. We have successfully developed lubricating grease has passed the US NSF and other products with the environmental
biodegradable industrial gear oil with excellent certification. In line with the increasingly strict data approaching to the international level and
biodegradability and corrosion resistance, international marine environmental protection obtaining certification from the world's largest
which obtains the European Eco-label requirements and the trend of low vulcanisation marine engine manufacturer.
certification and meets the US VGP (Vessel of marine fuel oils in future, we have developed
General Permit) standard. The food-grade medium and low-alkali marine cylinder oil 5025
In the field of synthetic resins In the field of synthetic rubber
In terms of high-end resins, we launch at least We take the lead to produce green tire
10 brands of high-security and eco-friendly new materials with high value-added rubber (SSBR
products every year. The output of high-end for short), which has excellent performance in
resins reached 2,700 tonnes in 2018. terms of fuel consumption, wear resistance, wet
skid resistance and low noise, etc. We continue
As for special materials for automobile parts, to promote the production of plasticiser-free
we focus on producing low-VOC and low- thermoplastic elastomer SEBS for medical,
odor products by optimising catalyst selection electrical insulation, food packaging and
and polymerisation conditions adjustment, to bonding, etc., becoming the world's third
improve the ride comfort and safety of drivers company with industrial production capacity.
and passengers. The output of products In 2018, the racetrack produced by SINOPEC
reached 70,000 tonnes in 2018. Baling with SEBS was applied to the sports
venues of Nanjing Foreign Language School in
In terms of household and pharmaceutical
Jiangsu Province, becoming the first recyclable
products, we take the lead in launching low
racetrack produced in China by using SEBS.
content of extractables (50% reduction) and
It has been applied to many colleges and
high-transparency propylene polypropylene
universities in Huai'an, Jiangsu Province.
copolymer products with low processing
temperature, which possess obvious
advantages of more safer in human body
contact and energy saving. We develop high
density polyethylene products with low-odor
features, and the packages made from them
are better in line with safety requirements of
human body contact. The output of the type
In the field of synthetic fibres
products reached 40,000 tonnes in 2018.
The ultra-high molecular weight polyethylene
In the field of pharmaceutical fibre and fibre produced by Sinopec Corp. is in the
household products, we develop plasticiser-free leading position in China, forming more than
polypropylene fibre materials. The products do 50 series products. In 2018, the fibre was
not contain plasticisers, organotin and highly successfully applied to the immersed tunnel
concerned substances (SVHC) that have hoisting of the Hong Kong-Zhuhai-Macao
an impact on people and the environment. Bridge. The Company has become the largest
The finished products can be widely used product supplier in China. The quality of carbon
in personal care, infant health products and fibre products produced by the Company has
surgical isolation clothing and other fields. been continuously improved, and the products
Based on this fibre material, antibacterial have been applied in many fields. The carbon
materials have been further developed which fibre sucker rods have been used in SINOPEC
can be used in the medical treatment areas. Shengli Oilfield Company and SINOPEC
The output of the type products reached 70,000 Zhongyuan Oilfield Company, with remarkable
tonnes in 2018. energy-saving benefits of oil wells.
18 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Topic 3 Intelligent Operation 19

Intelligent Intelligent Intelligent

plants pipeline service stations
In 2018, we conducted technical upgrade in We have developed Sinopec Intelligent We actively advance the construction of
pilot intelligent factories and completed two Pipeline Management System, ranking the first intelligent service stations, leverage internet
pilot upgrade projects in SINOPEC Maoming corporate-level pipeline management system technologies such as big data, cloud
and SINOPEC Zhenhai comprehensively, of in China. The underground pipelines and computing, mobile payment, and the Internet
which, SINOPEC Zhenhai realised the real- station depots can be visualised from multiple of Things (IoT) to build comprehensive service
Topic 3 time monitoring and early warning of equipment
and instrument operation, which successfully
dimensions by technical means such as three-
dimensional modeling, panoramic imagery and
stations that provide services people and
vehicles, apply the equipment automation,
Intelligent prevented the unscheduled shutdown caused
by instrument malfunction. The intelligent
video surveillance. The system can cover all
data of the 34,000 km pipeline.
business digitalisation, and intelligent service
in the stations to facilitate the transformation
Operation factory 2.0 technical solution and promotion
model was formulated based on the ProMACE In 2018, we promoted the system application
of the service station from traditional single-
purpose oil product sales to a service station
platform, and the intelligent factories were also and realised the functions covering assessment system project with comprehensive service
launched in six subsidiaries including SINOPEC of hidden hazards. The system automatically resource integration.
Shanghai, SINOPEC Qilu, SINOPEC Tianjin, labels relevant emergency resource
SINOPEC Jinling, SINOPEC Qingdao and information under emergency conditions and We have established pilot stations in Beijing,
SINOPEC Hainan. automatically correlates information of the Tianjin, Jiangsu, Zhejiang, Hunan and
pipeline on accident points and its surrounding Guangdong, etc., and gradually launch the
From 2015 to 2018, five subsidiaries including environment, thus improving emergency mature functions of pilot stations (convenient
We promote informatisation through building intelligent factories, intelligent oil and gas fields, intelligent pipelines, intelligent service stations, and e-commerce SINOPEC Jiujiang, SINOPEC Zhenhai, response capacity. payment, self-service equipment, unified
platforms such as EPEC and Sinopec Chememall. According to the informatisation development plan of Sinopec Corp., we will establish 10 intelligent factories SINOPEC Maoming, SINOPEC Puguang Gas marketing management, etc.) in service
by 2020 and build "three clouds" by 2023, i.e. management, manufacturing and service, so as to support the upgrading of the intelligent manufacturing in the Field and SINOPEC Shanghai were awarded stations.
as the state-level intelligent manufacturing
whole industry chain, which will promote development of trade, logistics and finance with new commercial forms and improve the lean management level.
demonstration pilots. Sinopec Corp. has taken
the lead to build intelligent factories in terms of
intelligent manufacturing of process industry.

Digital management
In 2018, we strengthened digitalisation of development knowledge map, thus improving management, process management • Based on the "Internet + Supply Chain", the new model of e-commerce operation SC2B (Supply Chain to Business) which relies on the industrial foundation,
production and operation platforms to optimise the efficiency of scientific research and and large unit management, etc., which we built the EPEC industrial product e-commerce platform and the Sinopec Chememall chemical product sales platform, thus promoting vertical and
production and improve the function of innovation. improved collaborative production and lean horizontal integration between industries, between enterprises, and between enterprises and industries.
forecasting and early warning, as well as to • We promoted the construction of production management. We applied the operation
enhance safety and environment management. informatisation and Sinopec E&P Business management in 7 subsidiaries with the
The independently-developed petroleum Cooperation Platform (EPBP) in oilfield average qualified rate of device operation Statements from stakeholders
and petrochemical industry internet platform subsidiaries, and have boosted business reaching 95%; applied the process
(ProMACE) was selected in the list of 2018 collaboration and data sharing. Moreover, we management system in 7 enterprises with the The EPEC standards and the integration and interconnection of information systems between the EPEC platform and industrial enterprises effectively promote
the transformation and upgrade of industrial enterprises, informatisation upgrade, technological innovation, sustainable development and trade integration.
Industry Internet Pilot Demonstration Project realised unattended production sites of oil device pre-inspection efficiency increased
by the Ministry of Industry and Information wells and station warehouses, and achieved by 60%; connected the data of 325 units of ——Dragana, Beijing Representative Office of United Nations Industrial Development Organisation (UNIDO)
Technology. real-time monitoring, automatic warning 32 refining and chemicals subsidiaries to the
and remote control of oil & gas production large unit management and training system,
• Sinopec scientific research knowledge operation management. which realising centralised control and expert
management system was built and launched • In refining and chemicals subsidiaries, remote diagnosis of centrifugal compressor
to build a 10 million-node exploration and we promoted the systems of operation units.
20 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Topic 4 Targeted Poverty Alleviation 21

Poverty alleviation through industrial development

Taking the distribution characteristics of natural resources in different regions, we carried out the construction of planting and breeding bases. With our
efforts, the Beautiful Village Homestay Programme, the Batik Programme and the Programme of Fish Farming in Ricefield have become one of poverty
alleviation demonstration programmes in Fenghuang County, Anhui Province. We cooperate with Gansu Academy of Agricultural Sciences to develop high-
tech agriculture and launch quinoa and sweet sorghum planting demonstration programmes in Dongxiang County, Gansu Province. In addition, we integrate
natural water resources in Tibetan Plateau with Sinopec Corp.'s 27,000 EasyJoy convenience stores and enable Tibet Glacial Water to market national wide,
realising sales turnover of RMB 1.58 billion, taxes and fees of RMB 163 million and job opportunities for 732 people.

Carry out poverty alleviation through Organise professional salesmen Cooperate with China Social

Topic 4 consumption and encourage internal

procurement. Suitable products are
to guide the sales work in poverty-
stricken counties to enhance the
Poverty Alleviation Network, China
Foundation for Poverty Alleviation

Targeted Poverty directly introduced into Sinopec EasyJoy

convenience stores. Sinopec subsidiaries
sales of local specialty agricultural
products. In 2018, we organised
(CFPA) to help sell agricultural
products from targeted poverty
Alleviation in Gansu and Hunan signed cooperation special exhibitions in Hangzhou for
alleviation counties and sell these
01 agreements with poverty-stricken areas 02 selling over 130 kinds of specialty 03 products on the Company's
to carry out agricultural and livestock agricultural products from poverty-
e-commerce platforms.
products sourcing conferences with the stricken counties.
theme of poverty alleviation. EasyJoy
convenience stores have sold the poverty
alleviation products in coastal cities.
The 2030 Agenda for Sustainable Development proposes SDGs including eradicating poverty in all its forms everywhere, eliminating hunger, ensuring
inclusive and equitable quality education. China has been engaged in an unprecedented battle against poverty and is expected to basically eliminate absolute
poverty by 2020. Advocating "Big enterprise undertakes greater responsibility", Sinopec Corp. conducts targeted poverty alleviation to facilitate the battle
against poverty. Focusing on infrastructure construction, industrial development, education support, labour training and healthcare, we help impoverished
areas and local people to improve their capability of sustainable development. By the end of 2018, Sinopec Corp. and its subsidiaries undertook the task of
Poverty alleviation through Poverty alleviation through Poverty alleviation through
poverty alleviation in 758 counties and villages and helped invest RMB 228 million. Yuexi County in Anhui Province under the Company's poverty alleviation
promoting employment education support providing better healthcare
programmes, passed through national evaluation and inspection, which means that the county with 400,000 populations has been lifted out of poverty.
The specific job fairs were held in Tibet, In 2018, we invested RMB 25.83 million in We aided the construction of the hospital on the
Qinghai, Gansu and other provinces, recruiting education to improve education infrastructure, world's highest altitude in Baingoin County, Tibet
114 unemployed students from poor families. purchase education and teaching equipment, and continued to undertake Sinopec Lifeline
and provide 1,374 student subsidies. We set up Express Programme, which helped a total of
Amount of fund introduced and Amount of agriculture products sold with
invested by the Company (RMB) the support of the Company (RMB) Improvement of people's "Spring Bud" classes to help school-deprived 44,000 patients restore vision. We cooperated
livelihood

228 146
girls return to school. We also have organised with Unimed Healthcare Poverty Alleviation
the Summer Camp themed with "Great Project in telemedicine to introduce public welfare
In Yuepuhu County located in Xinjiang, we
million million Wall Lubricating Oil · Chinese Astronauts resources to targeted poverty-stricken counties.
implemented comprehensive courtyard
Experience Camp" for 11 consecutive years, Through the project, we provided diagnosis and
renovation for 6,391 households to develop the
and helped over 70 students to participate in treatment services for 63 patients with major
courtyard economy. In Dongxiang County in
winter camps so as to broaden the vision of diseases and trained more than 100 doctors in
Number of registered people Gansu Province, we renovated 832 dilapidated
Number of people relocated outstanding students from impoverished areas. 2018.
helped by the Company houses to ensure the people's residence safety.

32,250 545
Number of participants of
• Sinopec Corp. won the honours of "National Xinjiang by the Labour Union of Xinjiang Uygur "Benevolent Enterprise for Targeted Poverty
professional skill training
Poverty Alleviation Case" by The State Council Autonomous Region. Alleviation" by Luoyang City, Henan Province.
Number of poverty alleviation programmes (person-time) Number of students who Leading Group Office of Poverty Alleviation • Zhongke (Guangdong) and SINOPEC Maoming • SINOPEC Yunnan Oil Marketing Company

3,149 1,374
through industrial development received subsidies and Development, "Gansu Province's Model was awarded the Copper Cup of "Guangdong received the honour of "Advanced Supporting

1,500
of Poverty Alleviation" by Gansu Province, and Poverty Alleviation". Company for Poverty Alleviation" by Deyi
"Recommended Case of Targeted Poverty • SINOPEC Changling and SINOPEC Baling was Township, Midu County, Yunnan Province.
Alleviation" by People's Daily. aclaimed for the contributions to local poverty • 13 employees were awarded the title of
• SINOPEC Xinjiang Oil Marketing Company was alleviation by Yueyang City, Hunan Province. "Advanced Individual on Poverty Alleviation".
aclaimed for the contributions to development of • SINOPEC Luoyang received the honour of
22 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Safety 23

Safety
The Company attaches great importance to safety management. We strictly abide by laws and
regulations such as the Work Safety Law of China, implement HSSE management system and set up
all-dimensional safety management rules covering safety accountability, safety behaviors, safety
training, risk management as well as hidden safety hazards treatment, operations and occupational
health, etc. We built emergency management and command system and enhanced our identification,
prevention and control of safety risks, evaluation and management of hidden safety hazards and
strengthened safety awareness of employees and contractors, sparing no effort to prevent varieties
of safety accidents.

For more details of risk management system and HSSE management system, please refer to the
section of Sustainability Management System in the report.
24 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Safety 25

Chairman message:
We must keep in mind that "development should not come at the cost of safety", uphold the philosophy that "lucid
waters and lush mountains are invaluable assets" and improve safety and environmental protection, striving to achieve
harmonious coexistence and coordinated development between enterprises, society and environment.

Work Safety
Risk identification and management Contractor Safety
In 2018, we issued the Regulations on Dual- Platform) to quantify risk. The Company and control are managed by subsidiaries, the risks
Channel Prevention Mechanism of Hierarchical the subsidiaries identified 1,140 work safety of greater difficulty in control are managed and In 2018, we identified major safety risks in contractor safety management including safety skills, safety awareness, and subcontract management, etc. and
Safety Risks Management and Hidden Hazards risks, and 30 of them were assessed as guided by company leaders, and the risks of
thus adopted the following measures:
Treatment in Work Safety and the Guidelines major risks. We categorised and managed major difficulty in control are managed and
on Risk Identification for Frontline Positions, major risks in a hierarchical order, assigned guided by the Chairman of the Company. In
amended the Guidelines on Safety Risk risk management personnel at all levels, and 2018, the total amount of corporate risk values • Implementing contractor safety commitment petroleum engineering projects has been management. We urged contractors to rectify
Assessment, and promoted the application of formulated management measures for reducing was reduced by 12.2%. mechanism to promote self-management. constructed and used. We carried out on- major problems identified and implemented
the safety risk assessment platform (PHAMS risk values.The risks of general difficulty in We promoted special corporate auditing site training for projects construction and accountability management for subsidiaries
mechanism on contractor safety system and maintenance work. or individuals with repeated problems or
implemented audit disclosure system. • Promoting typical demonstrations of inaction.
Safety management measures • Strengthening contractor safety training. contractor safety management system. • Establishing a blacklist for contractors with
We compiled contractor employee warning We selected SINOPEC Guangzhou, which regulation violations at both the Company
Considering the work safety accidents In 2018, we promoted the construction of the hidden dangers of hazardous chemicals and training programmes and implemented has achieved effective results as a model level and the subsidiary level. We limited
happening in China in 2017 and the standards safety management information platform and hazardous chemical processes. We established mandatory and targeted safety training. to promote standardisation of contractor the bidding qualifications and implemented
for identifying major hidden hazards by the the comprehensive application of key modules and improved leak detection mechanism and
We promoted standardised construction of safety management and operation safety clearing mechanism for contractors with
Ministry of Emergency Management of China, such as risk management and hidden hazards leak management account, so as to deal with
projects and improved three training bases management procedures and processes. serious violations.
we formulated the Guidelines on Rules of screening and treatment. We optimised the the leaks point-by-point.
in East China, South China and North China. • Conducting normalised and continuous
Sinopec Hidden Hazards Identification for three-year plan for safety technology, carried
We enhanced safety technology exchanges The training base for safety operation of safety surveillance on contractor safety
Major Work Safety Accidents (For Trial out safety technology research, and promoted
Implementation) in 2018. Moreover, in order the application of research projects such and held seminars to further improve
to tackle hidden hazards in tank areas of as mobile monitoring systems for high-risk management of abnormal conditions and
primary and secondary hazardous sources, operation, hydrogen sulfide elimination, and emergency treatment. Besides, we continuously
Case
we formulated the Guidelines on Renovation quick connectors for hazardous chemicals carried out risk training about emergency
of Atmospheric-Pressure Storage Tanks for loading and unloading. We moved forwards knowledge and skill training for all staff as Contractor Safety Management
Flammable and Combustible Liquids (For Trial the trigger point for emergency treatment to well as emergency plan drills to enhance the
Company's capabilities of risk identification & In 2018, a contractor safety accident occurred in one of the subsidiaries of Sinopec Corp. After the accident, Sinopec Corp. set up a working group
Implementation). In addition, we organised warnings of abnormal operating conditions and
consisting of Sinopec's work safety management department, the subsidiary's safety and environmental protection department, and contractor
subsidiaries to work on hidden safety hazards process equipment to improve the efficiency assessment and emergency response. In 2018,
personnel to investigate the cause and immediately launched a series of arrangement including hidden hazards detection, improvement of
inspection and treatment. The conference of information transmission and disposal of the coverage ratio of safety training reached
employees' safety awareness, and contractor safety skills training. We included the contractor's safety risks into the list of Sinopec Corp.'s major
for advancing work on hidden safety hazards emergencies. We carried out risk investigation, 100%.
risks. The senior management of the subsidiaries was allocated to organise the compilation of guidelines on identification and control of safety risks
inspection and treatment is held quarterly to assessment and control of hazardous in processes of construction, inspection, repair, operation and maintenance which guides safety management of contractors.
guide and coordinate subsidiaries to enhance chemicals, established safety risk distribution
safety hazards management. files for hazardous chemicals, and rectified
26 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Safety 27

Logistics Safety
In 2018, we identified hazardous chemicals transportation was a major risk and formulated safety
management regulations on hazardous chemicals carriers, and standardised admission, auditing
and assessment of carriers and means of transport. By analysing the characteristics of transportation
volume, transportation points, transportation routes and types of hazardous chemicals, we formulated
corresponding systems, standards and management measures to clarify the requirements for loading
and unloading and transportation of hazardous chemicals. Based on Sinopec Corp.'s supply chain and
logistics platform, we have built a safety management platform for hazardous chemicals transportation,
which integrates functions such as hazardous chemicals transportation resources database,
process monitoring, early warning, emergency plan push and statistical analysis. We formulated the
Regulations on Safety Surveillance of Hazardous Chemicals Carriers, analysed the conditions of
highway and waterway oil products carriers and vehicles, and have implemented unified monitoring for
vehicles and ships of hazardous chemicals transportation. In 2018, the Company hasn't received any
safety accident of hazardous chemicals transportation reported.

Cyber Security
In 2018, we identified major informatisation risks including cyber-attacks, internal network authority
management, computer virus infection and data security. We formulated the Emergency Plan for Cyber
Security Incidents, the Rules for Major Fault Emergency Management, the Special Action Plan for Internet
Application Safety Management, and improved the IT infrastructure emergency plan. We organised five
coordinated emergency drills throughout the year. Moreover, we worked with external technical experts
to carry out network application monitoring and safety technical protection, and strengthened testing for
application system safety defense and emergency response and system recovery, so as to ensure safe and
stable operation and data security of e-commerce platforms and major application systems. We conducted
safety inspection and established internet application safety archives. Besides, we organised the cyber
security technology competition in the Company and trained talents of cyber security technology. In 2018,
the Company had no external network intrusion incident and major cyber security incident.

Public Security
We strictly followed the principle of "without risk assessment, none institution establishment, project
bidding, or personnel deployment is permitted" to carry out public security. We have formulated the
Regulations on Overseas Public Security, which stipulates risk classification, risk assessment, risk
prevention, emergency management and hierarchical treatment. We considered the different risk
levels, local social and natural conditions before site selection for overseas subsidiaries and equipped
security personnel for them. In addition, we strengthened collection and analysis of public security
information to improve the timeliness, pertinence and effectiveness of security forecast/warning.

In 2018, we established the security information warning mechanism and released special prompts
to overseas employees for emergencies. Subsidiaries/projects in extremely high-risk areas were
equipped with security officers from professional security agencies in China and security consultants
were assigned to local government agencies/projects to assist in short-term security training and
improve security equipment. In 2018, a total of 43 security consultants and security officers were
dispatched. Overseas employees were equipped with SOS emergency contact cards and offices were
equipped with first-aid kits and the emergency evacuation routes and assembly locations were marked.
Besides, we conducted health risk assessment to guarantee the medical service, psychological care
and stress relief for overseas employees.
28 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Climate Change 29

Climate Change
We practice the green and low-carbon development strategy, actively respond to climate change,
and integrate energy conservation, emission reduction and carbon reduction into an overall
management system. We promote clean production and protect the environment for building a
resource-saving and eco-friendly green enterprise.
30 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Climate Change 31

Climate-Related Risks Our Actions

Attaching importance to climate change will help relieve bottleneck constraints on the current resources, accelerate fostering new economic growth, which will Actions to addressing climate change can foster Sinopec Corp. new growth drivers, help accelerate the Company's low-carbon energy transition and promote
accelerate the transformation of economic development pattern and contribute to promoting the industrial transformation and upgrading. As an energy and high-quality development. Sinopec Corp. has actively implemented Green and Low-carbon Development Strategy, continuously strengthened the integrated
materials provider, Sinopec Corp., on one hand, focuses on the development of major businesses and provides clean, high-quality and affordable energy and management of energy and environment, launched Green Enterprise Campaign, speeded up Energy Efficiency Improvement Plan, promoted clean production
petrochemical products to promote social development and meet people's living needs; on the other hand, the Company pays high attention to the climate- and strengthened carbon assets management to embrace the Climate-Related opportunities.
related risks and opportunities to the enterprise's development.

Improving energy efficiency

• Consensus has been reached on combating climate change. Series of
International, national and regional laws and regulations enacted to limit • We promoted informatisation of the energy • We adopted the mature and applicable
GHG emissions, together with more stringent climate-related regulations management system and the system has been energy-saving technologies. In 2018, a total TIPS

that might be formulated in future, will affect global demands for fossil built in 9 refining and chemicals subsidiaries. of 280 technical reformation projects were
As required in Energy Efficiency
Through optimising online operation of steam implemented, saving energy equivalent
fuels. They may also increase corporate capital expenditure and affect Improvement Plan, the subsidiaries
power, the real-time monitoring and dynamic to 280,000 tonnes of standard coal. More
future corporate profits and strategic growth opportunities. set the targets of energy efficiency
optimisation of the operation processes of specifically, Gudong Oil Extraction Plant of
• China has made a set of commitments that are to be reached by 2030: to improvement for the next year
boilers, steam pipeline network and gas pipeline SINOPEC Shengli Oilfield Company adopted
achieve its peak CO2 emissions (and to make every possible effort to peak at the end of each year. The
network, etc. have been achieved. In 2018, over the technology of injection-production-
earlier), to lower CO2 emissions per unit of GDP by 60 to 65 percent from implementation progress of the Plan
RMB 30 million were saved by these efforts. transmission integrated operation, which
is reported monthly, the existing
the 2005 level, and to increase the share of non-fossil fuels in primary • We advanced Energy Efficiency Improvement was awarded as National Demonstration
problems of subsidiaries are
energy consumption to around 20 percent. • Stakeholders pay more attention to ESG (environment, society and Plan by adopting measures such as recycling Project for Energy-Conservation; SINOPEC
reported and discussed quarterly,
• China launched the national carbon emission trading system in 2017. The corporate governance) performance of the Company. The Company's low- natural gas and utilising distributed energy Maoming optimised the technology with the
and the annual assessment is
energy and chemical industry is expected to be gradually incorporated into carbon transformation may fall short of stakeholders expectation which sources etc. In 2018, 481 projects were equipment energy consumption 37% lower
conducted in accordance with Rules
the system. may impact our reputation. implemented and 706,000 tonnes of standard than design specification, and increased the
for the Implementation of Energy
coal were saved annually. More specifically, high value-added product yield at the same
and Environmental Performance
159,000 tonnes were saved in E&P sector, time; SINOPEC Shijiazhuang implemented
Assessment.
239,000 tonnes saved in refining sector and 30 projects for energy conservation, reducing
274,000 tonnes saved in chemical sector. the comprehensive consumption of energy per
• We carried out energy conservation inspection RMB 10,000 of production value by 6.6% and
of construction projects. In 2018, a total of saving energy of 25,000 tonnes of standard coal

Policy and Market and 49 projects were inspected, focusing on the throughout the year; SINOPEC Qilu achieved
Reputation Operation integrity of energy consumption calculation, the energy consumption reduction by over 35%,
Regulation Technology feasibility of energy conservation measures saving energy of 11,900 tonnes of standard
and the compliance of energy measuring coal.
instruments, to eliminate high energy-
consuming and inefficient projects.

Consumption of comprehensive energy per RMB 10,000 of production value

• Technology innovations that support the transition to a lower-carbon, • Extreme weather events such as typhoons, hurricanes or floods caused
energy-efficient economy system will increase the Company's R&D costs.
• People's attention to climate change may lead to public choice of low-
by climate change may cause direct asset damage to the Company's
production and operation. The supply chain disruptions caused by climate
2018 2019 2020

0.496 0.494 0.492

carbon products and services. change may also exert indirect impacts.

tonne of standard coal tonne of standard coal tonne of standard coal

32 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Climate Change 33

Natural Gas The development target of Natural Gas

Energy Production and Consumption Revolution deploy infrastructure moderately in advance, exploration and development plans to extend the
49.5%
Strategy (2016-2030) of the China proposes accelerate the development of terminal business, stable production period of gas fields and improve
43.5%
to realise the continuous growth of low-carbon and endeavor to build a production, supply, gas recovery rate. According to the overall 42.3%
energy such as natural gas in 2021-2030, storage, and marketing system with optimised deployment of gas popularisation in the Yangtze
39%
significantly reduce the use of high-carbon fossil resource allocation, efficient operation of pipeline River Economic Belt, the Company ensured 42.0
fuels and increase the use of natural gas in key network, powerful guarantee gas supply and stable production of gas fields in western Sichuan
areas with air pollution prevention target. In strong risk resistance, to achieve high-quality and etc., improved external pipeline, increased
33.0
accordance with national strategic requirements sustainable development of natural gas sector. market supply, and stabilised gas supply for the
27.5 28.7
of gas development, the Company formulates a Belt. We also improved gas pipeline network
In 2018, the Company continued to strengthen
strategic plan for effective and rapid development across the country, started the expansion project
the refined management of gas reservoirs in main
of natural gas, and builds an imported resources of Shandong LNG terminal, and promoted the
gas fields in order to meet the social demands
pool combining long, medium and short terms with second-phase expansion of Tianjin LNG and the
for natural gas. According to the characteristics
spots and futures on the base of strengthening preliminary work of the Guangxi LNG expansion Natural Gas (billion cubic metres)
of gas fields in different regions, we formulated 10.0 11.3
stability of domestic production. Moreover, we project.
7.3 Production of shale gas (billion cubic metres)
6.62
Percentage in oil equivalent (%)
2018 2019 2020 2023

Using alternative energy sources

We actively use low-carbon energy, promote Company adopted geothermal heating in
coal-to-gas practice, and apply geothermal office areas and residential areas in four
energy, solar power, residual heat and factories, saving energy of 11,000 tonnes
steam. In 2018, all production and living of standard coal throughout the year.
facilities of SINOPEC Lubricant Marketing SINOPEC Hainan Marketing Company built
Company were powered by clean energy. distributed photovoltaic power stations on
SINOPEC Northwest Oil Field Company the roof of service stations to provide self-
carried out oil-to-electricity operation and use electricity and upload surplus electricity
saved 14,000 tonnes of standard coal. to local grids. SINOPEC Pipeline Storage &
SINOPEC Jiangsu Oilfield Company Transportation Company reclaimed residual
promoted the application of "water-source heat from surrounding thermal power plants
heat pump + solar heating" and "air-source and refineries in 4 station depots. SINOPEC
heat pump + auxiliary electric heating" to Zhenhai developed mutual cooperation on
replace boilers, replacing over 2,000 tonnes steam and low-temperature heat supply with
of crude oil. SINOPEC Zhongyuan Oilfield 15 surrounding enterprises.
34 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Climate Change 35

GHG emission management

The Company attaches great importance to GHG emission, sets emission reduction targets and measures, continuously carries out carbon capture and
methane recovery, and promotes the development of alternative energy such as bio-aviation coal, biodiesel and photovoltaic power generation. In 2018, the
Company emitted 172 million tonnes (co2 equivalent) of GHG with an increase of 2.07 percent year-on-year*.

Methane emission reduction Flaring reduction Carbon capture Carbon asset management

The Company has set a goal of recycling more than 200 million The flaring system is the key facility to ensure safety. When certain In 2018, we continued to conduct CO2 capture and recovering among The Company carries out GHG emission reduction assessment, the
cubic meters of methane annually by 2023, and has taken various emergency occurs in the production process, the gas materials need to be E&P sector and refining & chemicals sectors. Refining and chemicals KPI is composed of 2 indicators such as total carbon emissions,
measures to reduce methane emission: discharged into the flaring system for burning in order to ensure production subsidiaries captured 1.01 million tonnes of CO2 and oilfield enterprises emission intensity and other 7 indicators including carbon accounting
safety and prevent subsequent accidents. However, flaring emissions will injected 240,000 tonnes of CO2 to enhance oil recovery (EOR). Since we and carbon trading etc. We advance the carbon assets information
• For wells/stations far away from the oil gathering and transportation cause environmental pollution and energy waste. carried out CO2 capture and recovering work, 2.45 million tonnes of CO2 system construction, and start the construction of carbon assets
network, vehicle-mounted CNG or LNG facilities are used for have been captured accumulatively and 3.44 million tonnes have been management information system in E&P, refining and chemicals
We worked hard to reduce the loss in petroleum processing and reduce
recovery. injected for EOR. sectors to enhance the statistical efficiency of CO2 emissions. In 2018,
environment pollutions from flaring. Adhering to the principle of safety
• Part of wells/stations adopts connecting pipes (or makeshift pipes) the pilot subsidiaries participated in carbon trade and completed total
production foremost, reducing organised emissions or venting, and
to enter the oil gathering and transportation network for recovery. Developing alternative energy carbon quota, that accumulated rich experience for the Company to
economic recovery and utilization, the Company formulates rules of
• Adopting technologies such as "testing during entrance" to recover participate in the national carbon trading market. The carbon trading
flaring emissions and recovery, includes the operation management In 2018, we continued to implement residual heat utilisation with the
natural gas during the testing process. volume reached 1.06 million tonnes, with carbon trading turnover of
of flare system into the process and equipment management system, calorific value equals to 750,000 GJ per year, and deployed the distributed
• Adopting oil and gas multiphase flow, oil jacket connecting about RMB 24.11 million.
and establishes the supervision and assessment system. In 2018, we solar photovoltaic power generation projects generating 5.171 GWh of
unit or casing gas recovery unit, low-power gas generator and
formulated flaring flow speed standards for different weather conditions electricity annually, equivalent to saving 28,000 tonnes of standard coal
supercharger to recover casing gas.
to reduce flaring and venting in natural gas purification plants, optimised per year and reducing 68,000 tonnes of CO2 emissions. SINOPEC Zhenhai
• Adopting oil and gas airtight gathering and transporting process and started the construction of China's first commercial production unit of TIPS
flaring plans for different sections, layers, gas reservoirs and well depths
large tank pumping unit to recover oil tank gas. 100,000-tonne bio-jet fuel. Biodiesel R&D and production was advanced
to prohibit venting and flaring when testing new wells, implemented gas B5 biodiesel, made of oil of aquatic plants such as oil-bearing
and the pilot project was conducted to inject B5 biodiesel into vehicles in
recovery in distant scattered wells and casing gas recovery. crops, oil-bearing wild plants, engineered microalgae, animal fats
Shanghai transportation system and specialty vehicles. At the same time,
or waste food oil, etc., is a renewable fuel instead of petroleum-
we selected renewable energy projects and promoted the infrastructure
made diesel. The Company has selected two service stations in
construction of hydrogen production, purification and hydrogenation
demonstration stations. The Company has set up demonstration stations Shanghai as pilot stations. B5 biodiesel on the market is mixed by
for refueling and hydrogen charging in Guangdong province. In 2018, the 5% biodiesel and 95% petroleum-made diesel. According to the
In 2018, the Company recovered methane about In 2018, the flaring from E&P sector amounted to Decreased by YoY Company joined the Hydrogen Council and signed strategic cooperation research of Shanghai Tongji University, after using B5 biodiesel,

104 6.3
agreement with domestic enterprises to build hydrogen refueling vehicle's engine runs normally and NOx emission is equivalent

226 million cubic metres

million cubic metres %
demonstration stations for the 2022 green Winter Olympics. to that of petroleum-made diesel, the emissions of air pollutant
including heavy metal particulars and fine particles are reduced by
over 10%, and the rate of de-NOx is over 80%.
The Company implemented residual heat utilisation and distributed solar
Reducing GHG emissions accordingly Flaring gas recovered photovoltaic power generation projects, which was equivalent to

3.35 million tonnes of CO2 equivalent

141 million cubic metres saving 28,000 tonnes of standard coal

Reducing carbon dioxide emissions

68,000
*Mainly due to the increased energy consumption incurred from the quality upgrading of refined oil and from the operation of new environmental protection
facilities; in addition, the relevant data of Shanghai Secco is included into the Company's statistics after it is acquired by the Company's subsidiary. tonnes per year
36 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Environment 37

Environment
The Company is committed to achieve the maximisation of resource efficiency and the minimisation
of pollution emissions by the advanced management and technology for achieving harmonious
coexistence and coordinated development between the Company, communities and the environment.
38 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Environment 39

Environment-Related Risks
Air emissions
Environmental protection has been incorporated protection supervision. Environmental management of our subsidiaries alongside
into China's national strategies. The Chinese protection standards and the total amount the Belt. At the same time, there arise new
government proposes that "stringent laws and of pollution discharge permits are strictly development opportunities for those enterprises
regulations ought to be observed to protect controlled. The Chinese government has that attach importance to environmental We manage the generation, treatment and discharge of air pollutants, install online environment monitoring facilities to ensure monitoring air pollutants
the ecological environment", successively issued Outline for the Development of Yangtze pollution prevention and treatment. Building emission on real-time, and control the volumes as licensed in the pollutant discharge permit. In 2018, the Company established and optimised air pollutants
issues laws and regulations for the prevention River Economic Belt, focusing on strengthening green enterprises has become the core management system discharged Sulfur dioxide and nitrogen oxides 67.2 thousand tonnes and 99.8 thousand tonnes respectively all year long.
and control of air, water and soil pollution ecological environmental protection of the competitiveness of enterprise's sustainable
etc., implements the pollutant discharge Yangtze River and the Outline proposes development.
• Over 910 sets of facilities and over 11 million LDAR inspection points • We carried out environmental protection campaigns in Beijing, Tianjin
permit system and strengthens environmental higher requirements for environmental
of all refining and chemicals subsidiaries and branches were included and Hebei regions and the surrounding areas, Fenwei Plains and the
into leak detection and repair system management. Through automatic Yangtze River Delta to ensure prevention and treatment of air pollution in
monitoring, alarming when excessively discharge and analysing the autumn and winter seasons.

Our Actions
discharge trend of key pollution sources under the State's control, we
promote the subsidiaries' pollutants discharge standard level.

02 04
The Company gives priority to protecting all of which are assessed annually. We were imposed throughout the year either.
environment, strictly follows Environmental conducted HSSE checks and specific Mansarovar Energy Colombia Ltd., a JV
Protection Law of the State as well as laws, environmental supervision, implemented of the Company, was awarded the green

01 03
regulations and regulatory documents on assistance for key subsidiaries for better enterprise certification for water source
prevention and treatment of air, water and soil performance, compiled and carried out protection and utilisation from ICONTEC, an
pollution, establishes dynamic management Guidelines on Pollution Prevention and international green enterprise certification
and control mechanism as well as work Treatment of Enterprises along the Yangtze organisation.
process of environment-related risks which River to satisfy the requirements on
covering identification-assessment-control- environmental protection along the River. We communicate with local residents during
hidden hazard treatment-reevaluation. The the operation process and established Public • We continued to upgrade and revamp environmental protection • We have completed the revamp of 27,300 service stations and 280 oil
production subsidiaries commit to treating The refining and chemicals subsidiaries Open Day mechanism. For all construction facilities, renovated coal-fired boilers for ultra-low emission, completed depots for oil and gas recovery, forming closed-loop management for
the generated waste water, exhaust gas and and enterprises under the Company's projects that may have an impact on the the renovation of processing furnaces for low-NOx combustion, and airtight loading/unloading system, and reducing VOCs emissions. Each
waste residue effectively through their own control have completed the application for environment, we communicate with local implemented VOCs treatment in tank areas, loading/unloading sites and year, we entrust the third party to test oil and gas recovery facilities in oil
environmental protection facilities or through pollutant discharge permit in accordance with residents about the possible impact of the
sewage plants. depots and service stations to ensure compliance discharge.
the third party. national regulations, while other subsidiaries project. In 2018, all the major construction
and branches are actively promoting the projects including E'ancang gas pipeline
In 2018, according to the State's Opinions discharge verification and application of the project, West Sichuan Gas Field capacity
Case
on Enhancing Ecological Environmental permit as required. The subsidiaries and construction project, SINOPEC Zhenhai
protection completely and Win the Battles for branches licensed with discharge permit expansion project, etc., were conducted SINOPEC Jinling Keeps Improving Clean Production
Pollution Prevention and Control and based upload pollutant discharge reports on the environmental impact assessment. We
Through applying clean production technology and measures, SINOPEC Jinling realised all sewage oil refined, all storage tanks water airtight
on the pollutant discharge management official website of local relevant authorities solicited public opinion by disclosing
sheared, discharged air from facilities overhaul all recovered, so as to reduce the loss rate of storage and transportation to 0.046% and the
system of Sinopec Corp., we formulated and are supervised by those authorities the assessment reports with local
processing loss rate to 0.36% which ranks the advanced level. In 2018, the Company implemented a number of enhancement projects and
Green Enterprise Campaign Three- and the public. The subsidiaries of the CIR communities on newspapers, online notice,
accomplished all storage tanks treatment of VOCs.
Year Implementation Plan for Pollution project in Kazakhstan actively carried out announcements and questionnaires, and
Prevention and Treatment. The Company environmental monitoring, regulated waste submitted the feedback on the website of
sent subsidiaries Letter of Energy Efficiency residues management and treatment, and national environmental protection authorities.
& Environmental Protection Responsibility reported environment management as All construction projects won support from
to set the targets on pollutant emissions, required. No major environmental accidents local residents.
emission reduction and pollutant treatment, occurred and no major environmental fines
40 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Environment 41

Water resources Solid waste

The subsidiaries implement strict classification management and • We carried out special inspection and supervision of solid waste
Water consumption assessment of non-hazardous and hazardous waste, promote the management, conducted comprehensive check of solid waste landfills,
philosophy of recycling economy following the principle of "reduction, organised soil and groundwater monitoring to ensure anti-seepage
We attach great importance to water resources management. We • According to the characteristics of the block, oilfield subsidiaries
reclamation, detoxification", and push forward comprehensive utilisation well-functioned, and disposed leachate legally, to prevent incidents of
implement strict management of total water intake plan, establish the formulate targeted measures to reduce inefficient-circulating water
annual target for water consumption, make early warning and adjustment of solid waste. In 2018, the Company treated 2.229 million tonnes of environmental pollution.
injection and promote the "sewage-to-clean water" project to save fresh
when the total volume of water intake increases too fast. Develop new solid waste and 505.3 thousand tonnes of hazardous waste, and the • We promoted clean production and solid waste reduction technologies
water. Gas field subsidiaries recover fracturing fluids to reduce sewage
technology, new process, new equipment and new materials for water proper waste disposal rate reached 100%. and achieved the reduction target through enhanced process control.
conservation, improve the efficiency of industrial water utilisation system discharge.
• We compiled the list of hazardous waste for each sector, studied
to reduce losses and waste during production and ancillary production • Refining and chemicals integrated subsidiaries stabilise the quality of
utilisation and compliance treatment plans, improved storage facilities,
processes. We strengthen recycling and comprehensive utilisation of waste sewage from the source of sewage by separating and treat oily sewage,
to enhance the hazardous waste standardised management. We
water to resourcing waste water. Promote subsidiaries and branches to salty sewage and high-salt sewage to improve recovery.
use municipal reclaimed water and desalinate sea water instead of using promoted the development of monitoring platforms for hazardous waste
• Subsidiaries in which the waste water recycling cost is higher than
fresh water. In particular, subsidiaries in coastal areas develop economical transportation and strengthened the supervision over the third party
the purchase price of fresh water conduct water utilising optimisation
seawater desalination technology and seawater-cooling technology to during the process of hazardous waste treatment.
make use of seawater. Subsidiaries located in areas implementing water diagnosis, formulate economic operation plans, reduce water utilising
tax reform comprehensively utilise unconventional water sources such as costs, and improve the recycling rate of waste water.
waste water and desalinated seawater to enjoy tax-free or tax-relief policy, Case
realising utilisation of water resources and cost reduction.
Since the issue of Implementation Plan for Water Pollution Prevention and Resource Utilisation of Mud Cuttings
Treatment Action in 2016, the volume of fresh water for industrial use has Combined with the characteristics of the area in which the oil and gas fields are located, oil and gas recovery is carried out by pyrolysis, brick
decreased by no less than 1% annually. The volumn of fresh water for making from residue sintering, curing paving and other ways to develop the resource utilization of mud and rock cuttings. In order to reduce the
industrial use of 2018 was 657.46 million cubic metres. ecological cost and environmental pressure of oil and gas exploration and development, we should persist in realizing the utilization of solid waste
resources and harmless utilization under the premise of safety, environmental protection and economic feasibility, so as to turn waste into treasure.

Sewage discharge management

We inspect production, discharge and treatment of waste water, carry
out risk assessment of various water, and implement hidden hazards 45.71
115.2
treatment. We review the compliance with National and local sewage
discharge standards, install online environment monitoring facilities to
E&P Statements from stakeholder
ensure real-time monitoring. In 2018, the subsidiaries implemented the
targets of waste water discharge and emission reduction set in Letter of Refining "Through thorough inspection and internal communication, we have made tailor-made resource utilisation plans for 127 kinds of solid wastes, set the target
304.15
Energy Efficiency & Environmental Protection Responsibility, promoted that solid waste treated rate to reach 100% and comprehensive utilisation rate to reach 80%, which contributes to building green enterprise."
192.4 Chemical
the upgrade of sewage sites, improved the pre-treatment effect, equipped ——Liu Chunxiang, Director of Safety and Environmental Protection Department of SINOPEC Tianjin
with de-nitrogen and de-phosphorus facilities as well as online monitoring Others
facilities to detect the amount of nitrogen and phosphorus, and enhanced
Unit: million cubic metres
the treatment capacity of sewage sites. In addition, water-conservation
trainings and skill competitions were organised to improve employees'
capabilities. During the year, 19.4 thousand tonnes of COD and 2 thousand The volumn of fresh water for industrial use in
tonnes of ammonia nitrogen were discharged. different segments

Case

"Zero Discharge" of Extracted Water in Yuanba Gas Field

SINOPEC Southwest Oil & Gas Company actively explored the comprehensive utilisation technology of extracted water in sulfur-bearing gas fields.
After more than one year of research and development, the "pre-treatment + cryogenic distillation + recycling" process was successfully developed
and applied in Yuanba gas field in May 2018. The low-temperature distillation station of extracted water was completed and put into operation,
realising zero discharge of extracted water in Yuanba gas field. It is estimated that 150,000 m3 of water can be recycled every year.
42 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Environment 43

Land resources Biodiversity

We strengthen the management of land single well. We conduct evaluation on safety 2784 acres, of which 2768 acres of unpolluted In accordance with the relevant regulations of All subsidiaries should strictly implement or eliminate impacts. We adopt the methods
resources in accordance with the principle of and environmental risks of idle land such land delisted and 14 acres reclaimed. A total of Environmental Protection Law and Convention national and corporate regulations to integrate of stratified excavation, separate stacking and
intensive, efficient and green land use. Oilfield as discarded well sites and delist it from 330 abandoned well sites were treated, among on Biodiversity, we formulate Measures for biodiversity protection into the evaluation, stratified backfilling in pipeline construction.
subsidiaries take great efforts in implementing exploration or conduct reclamation for that which, Sinopec Northwest Oil Field Company the Environmental Protection Management decision-making and production operations of We restore the land as much as we could after
of Sinopec Corp., urge subsidiaries to strictly projects construction. construction. We select the directional drilling
the intensive mode of well deployment during without safety and environmental risks. In reclaimed 53 wells and 7 stations located in the
follow relevant requirements of national laws method as far as possible. When implementing
exploration, reduce the occupied area of 2018, the total amount of land delisted was populus euphratica forest reservation area. As for projects that may have negative impacts
and regulations on ecological protection, large excavation, we choose to work during
and strengthen pre-project evaluation and on the environment, we evaluate the impacts the dry season to minimise the impacts on
verification, formulate ecological protection on ecological protection areas, forests, river waters. In 2018, no incident of biodiversity
wetlands, as well as animals and plants
Oil Spills and restoration plans, and strictly implement
management during construction and during the periods of pre-project evaluation,
damage occurred.

production, reducing disturbance to ecological construction and operation. Targeted measures

environment and protecting biodiversity. were formulated correspondingly to mitigate
We carry out oil spillage risk analysis and pipe networks, power grid and ships in the and impact evaluation, amended and added the
evaluation, strengthen emergency drills and sea area were highly concentrated, and there emergency plan system, and formulated refined
skill training, improve oil spillage emergency were multiple risks such as collapse, damage treatment plans for spills in open waters, semi- Case
plans, and build a professional team. In and rust caused by a long period corrosion open waters, beach and land areas, as well
2018, SINOPEC Shengli Oilfield Company of marine environment and climate around as the emergency treatment plan for spills in Ecological Protection in Baimashan Forest Park Project
assessed and identified that the distribution the beach of oil field. Given this situation, the beach and shallow sea areas. Baimashan Forest Park is listed as the secondary level of the ecological redline area of Jiangsu Province. The pipeline of Sinopec Corp. crosses
of oil exploration and development facilities, Company organised oil spillage risk analysis the area for about 360 metres from east to west. After evaluation, we concluded that the pipeline crossing sections were mainly the farmland and
highways, and a small amount of forest land. The related ecosystem in engineering areas was simple and didn't serve as habitats for flocks of birds,
and there were sparse wild animals and no wildlife under special national protection. We adopted the following measures for ecological protection,
recovery and compensation:

• We minimised the width of the construction belt when crossing the forest. The width of the general construction belt is controlled within 14 metres,
and the construction width within the forest land was controlled within 12 metres. Construction time was limited to about 5 days.
• We delimted the scope of construction and no tree was cut beyond the construction belt. Only weed-grown land was occupied for temporary
construction materials storage and no forest land was occupied.
• We strengthened management and training of construction personnel, and strictly prohibited construction workers from poaching wild animals.
• We carried out financial compensation and ecological compensation in accordance with the principle of "if occupation then compensation". Grass
and low shrubs were planted within 5 metres on both sides of the pipeline in the forest section, and trees were planted out of the 5 metres area
after projects construction.

Statements from stakeholders

Development can never be achieved at the cost of ecological environment. We must be both an energy supplier and an ecological environment protector.
——Head of Da'niudi Gas Field No. 1 factory
44 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Contributing to Society 45

Contributing to Society
Sinopec Corp. serves a number of fields related to people’s livelihood. While promoting business
development and economic performance, the Company pursues an openness and win-win
cooperation and drives the sustainable development of value chain partners.
46 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Contributing to Society 47

Value Chain Management

Improving capability of safety &
The businesses of the Company cover 66 out of 96 industries in China. Each industry is connected with hundreds of entity enterprises which constitutes
an industrial ecological network of Sinopec Corp. We pursue sharing values and strengthen cooperation with value chain partners such as contractors and
suppliers. We build digital supply chain through E-commerce platforms such as EPEC and Sinopec Chememall, which make the whole process from raw
material procurement, manufacturing to products delivery become visible, reliable, and traceable to build an open, fair, justice and honest market environment.
environmental protection
In supplier management, we improve supplier The Company holds supplier trainings environmental protection and occupational
on-site qualification criteria, define HSE regularly to publicise Sinopec requirements health of contractors) assessment score of
evaluation contents, integrate ISO 14000 on environmental protection and safety construction projects accounts for 25%. The
and ISO 18000 accreditation, establishment management. In 2018, over 3,000 suppliers "one-vote veto" system is adopted for projects

Promoting the establishment of credit system of emergency management system for safe
production and labour protection measures,
were trained. construction with major accidents in safety and
environment, and the corresponding stage and
In contractor management, we have formulated
and emissions and waste disposal into annual performance will be evaluated as zero.
In supplier management, we strengthen By the end of 2018, 20,319 suppliers passed In contractor management, we have the Management Measures for Performance
the standards of review. We also increase
the development of credibility system by qualification review. 6,000 items of materials formulated the Management Measures for Assessment of Construction Projects, in
the scoring weight of health, safety and
optimising supplier qualification review and equipments provided by 2,580 suppliers the Construction Project Market Creditability which HSE (including safety management,
environment management in on-site evaluation.
and dynamic mechanism of suppliers' were upgraded while 5,102 items provided System of Sinopec Corp., and built a
performance evaluation, and increasing by 753 suppliers were downgraded. 68 supervision and management platform for
penalties for defaults. More specifically, the suppliers were punished, of which 22 were our construction projects tendering and
quality assurance accounts for 15-30% of disqualified and 22 were suspended. The bidding to strengthen the assessment of
the total score of the review and evaluation, Company signed strategic cooperation the creditability system. Contractors who Supplier 2016 2017 2018

after-sale service accounts for 5-10% of the agreements with those suppliers with violate the regulations shall be punished by
Percentage of qualified by QHSE management system (%) 24.8 26.7 26.0
total score, which helps suppliers improve advanced technology, excellent performance suspending bidding, questioning, warning
quality constantly. and good social responsibility contribution. In or blacklisting, etc. In 2018, 26 contractors 8,517 9,614
Qualified by the quality management system (ISO 9000) Number 9,265
2018, the Company has 86 strategic partners were blacklisted or suspended.
accumulatively. Percentage (%) 59.9 52.9 47.3

Qualified by the environmental management system (ISO 14000) Number 3,755 5,442 6,071

Percentage (%) 26.4 31.1 29.9

Statements from stakeholders Qualified by the occupational health and safety management system (ISO 18000) Number 4,465 4,839 5,621

EPEC explores a unique path to take advantage of e-commerce platforms and creates the development principles of innovation, coordination, green, open and Percentage (%) 31.4 27.7 27.7
shared growth. Besides encouraging and supporting all kinds of enterprises on this platform to promote structural adjustment and transformation, it provides
clean products and better service for society, and meet the requirements of the people. It also helps manufacturers and suppliers be more resource-efficient
and environment-friendly enterprises, and promotes the sustainable and healthy economic development, thus better fulfilling the social responsibility.
Contractor 2016 2017 2018
——Zhang Qiang, Chief Representative of Beijing Representative Office of ASME (American Society of Mechanical Engineers)
Percentage of contractors qualified by the QHSE management system 100% 100% 100%
48 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Contributing to Society 49

Advancing Win-Win Cooperation

with Customers
Service improvement
Quality management We tap the potentials of service station connection with a hundred of strategic consumers. Besides, our B2B payment function
network, promote the new business mode of suppliers' information systems, and improved on financial service platform had been improved
We abide by the Product Quality Law and quality risk from procuring external refined oil on ISO 9001 so as to meet the product and "internet + sales + service" to offer diversified the procurement efficiency and customers' to provide comfortable and convenient services
other relevant regulations, strive to practice and set up the quality assessment mechanism service specific requirements of customers services and provide services including loyalty; Sinopec Chememall platform set for consumers.
the quality goals of "quality first and quantity and a negative list. For the suppliers which from different industries. In 2018, SINOPEC automobile service, insurance and fast food; up marketing strategies such as "tailored
sufficient, customer satisfaction". Sinopec provide stable quality products, we optimise Lubricant produced 37,993 batches of we expand cross-border e-commerce business programme for customer, tailored marketing In 2018, 240,000 customer satisfaction
Marketing Company establishes the quality the quality assessment process. In 2018, lubricating grease, all of which passed the to provide overseas customers with diversified policy for product". The Company made questionnaires were distributed by Sinopec
high-quality products. For Sinopec chemical further progress on development of integrated Marketing Company, and 3,253 questionnaires
management system aligned with GB/T19001 more than 28,000 samples passed inspection factory inspection. 120 batches of products
products sales, the links between production, logistics system, including building supply chain were distributed by Sinopec Chemical Sales
standards. More specifically, 7 subsidiaries held by national, provincial and municipal were randomly inspected by the national and
sales and research are closely connected to and logistics platform, completing the pilot Company. SINOPEC Lubricant entrusted the
have passed the third-party certification of ISO testing institutes. SINOPEC Lubricant has local administrative organs, all of which were
provide tailor-made service for customers. construction of refined oil logistics in Southern third party to analyse and identify customer
9000 quality management system. We continue established a quality management system qualified in quality.
In 2018, the Company continued to fulfill the China and crude oil logistics in Eastern China. satisfaction by internet data analysis methods
to build risk prevention system to eliminate integrating different industries standards based so as to improve customer service.
establishment of customer service platforms. Besides, our B2B payment function on financial
Ten new vertical procurement zones on the service platform had been improved to provide
SINOPEC Lubricant won the national honor of "Star of Integrity" from Publicity Department of the CPC Central Committee and National EPEC platform has been built, which integrated comfortable and convenient services for
Development and Reform Commission (NDRC).

Awarding scripts of "Star of Integrity" for the SINOPEC Lubricant: For the past 60 years, they acted as a national strategy promoter, and
industrial development booster. Leading the technological development and serving the society are their unchanged original aspiration. They
Indicators 2016 2017 2018
are not only the leaders of honest operation among Chinese enterprises, but also the one dedicating to the Chinese aerospace dream.
Number of fuel card holders (million) 114 132 146

Customer satisfaction for refined oil products (%) 83.21 84.09 85.08

Customer complaint settlement rate for refined oil products (%) 100 100 100

Number of EasyJoy convenience stores 25,591 25,775 27,259

Customer satisfaction for chemical products (%) 91.3 91.5 93.1

Customer complaint settlement rate for chemical products (%) 100 100 100

Customer satisfaction for lubricant (%) 85.0 85.0 87.0

Customer complaint settlement rate for lubricant (%) 100 100 100

Customers' privacy protection

We attach importance to the protection of customer privacy. For the online business hall of fuel card, refined oil e-commerce website, wechat marketing
platform and other internet applications, we carry out screening and identification of risks and hidden hazards, and eradicate network security accidents. We
also improve the maintenance function of customer information, and entrust the Information Security Level Protection Evaluation Centre of the third party to
conduct data security evaluation on major information systems.
50 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Contributing to Society 51

Promoting Industry Development Public Welfare

The Company actively engages and China, and created an open, transparent and work with universities to set up joint R&D Sinopec Lifeline Express Assist in danger and help in need, Warm Stations Programme
cooperates with external partners in the healthy industry ecological environment. centres to promote innovative development
Since 2004, we have been participating in the
contribute to local communities Every year, we launch Warm Stations
formulation of industry standards, safety • We work with local governments and research of enterprises. In cooperation with
automotive manufacturers and industry Lifeline Express Programme to provide free Programme to assist people heading home in
and environmental protection, technological institutes to develop operation safety risk The Company takes advantages of our
associations, we explore how to achieve a surgery for vulnerable cataract patients. Among Chinese Spring Festival. In 2018, Warm Stations
innovation and other aspects to promote the prevention and control technologies for business features and professional team, to
good match between engine oil and new all four existing Health Expresses, Sinopec Programme continued to deploy in Guangdong,
development of the industry. petrochemical terminals, and 5 achievements actively make contribution to safe and stable
engine equipment under new emission Lifeline Express is the only one donated by Guangxi and Jiangxi, etc. More than 5,000
have been made including Safety Requirements development of the community in operation
requirements. By cooperating with automotive Chinese enterprise. Meanwhile we have volunteers provided free hot water, hot porridge,
• We undertake the National comprehensive for Petrochemical Terminal Operation. We region. In summer and autumn each year,
manufacturers, we also develop special established an ophthalmic microsurgery training medicines and medical services in 238 service
standardisation project of intelligent assist the Ministry of Environment and Ecology SINOPEC Marketing companies set up special
lubricant products for new energy vehicles, centre and 20 Sinopec Cataract Treatment stations, helping 600 thousand returnees.
manufacturing and completed 10 drafted in carrying out environmental supervision in key supply stations of oil products for farmers in
areas of refined oil to improve environmental and work with China Society of Automotive Centres to provide long-term treatment services villages, towns and rural areas to deliver oil to
standards and R&D on standard verification
protection. Engineers to prepare standards on oil for for vulnerable cataract patients in local areas villages and support farmers to win big harvest.
platform in 2018. The Standards we released
electric vehicles. by donating medical equipment and training
on EPEC become the first industrial products • Focusing on the cutting-edge area of Volunteer Service Programme
doctors. In 2018, Sinopec Lifeline Express Subsidiaries like SINOPEC Shengli Oil Field
and manufacturers evaluation standards in chemical industry and new materials, we
provided free surgery for 3,456 patients in made good use of their advantage to establish We continue our volunteer services, engaging
Shangqiu, Henan Province, Yili, Xinjiang and emergency rescue work mechanism with local in activities of community service and concerns
Zhaoqing, Guangdong Province. The Company government departments such as maritime for left-behind children and lonely elderly by
has accumulatively cured over 44,000 cataract authorities and fire protection as well as leveraging multi-provincial and multi-enterprise

Community Engagement patients free of charge and donated over RMB organisations of the same industry, so as to cooperation. In 2018, a youth volunteer
154 million. prepare for social aid and rescue works such programme of "Petroleum Knowledge to
as hazardous chemicals fire protection and oil Schools" covered more than 1,200 students
spilling disposal, etc. from over 30 classes in Beijing. A team led
With principles of "integrity, standardised The employees' localisation rate of joint venture business trainings for 211 person-times,
Sanitation Workers' Stations by Jin Zhijun, academician of the Chinese
operations, win-win cooperation, serving the Mansarovar Energy Colombia Ltd. reached industrial safety trainings for 367 person-times Our joint venture Mansarovar Energy
Programme Academy of Sciences and retired senior
local communities and making contributions 98% and domestic procurement rate reached and dispatched 14 local employees to China Colombia Ltd. promotes cocoa planting, animal
manager of Sinopec, introduced technological
to local economy", the Company continuously 89%. Taxes paid by subsidiaries of CIR for training on production technology, cost We start Sanitation Workers' Stations husbandry, milk storage and transportation,
knowledge and ecological environmental
Programme in 13 provinces (autonomous rainforest restoration and other co-engagement
promotes local social and economic projects was nearly USD 230 million, and the reduction, efficiency improvement and industrial protection of shale gas development through a
regions and municipalities), including Beijing, projects in local areas, which makes 30% of
development by investment, tax contribution, proportion of localised employees exceeded safety, etc. ARMAN sent 2 employees to China live broadcasting co-hosted by Gmw.cn.
Tianjin, Hebei and Yangtze River Delta. We local residents having decent lives. It carries
providing job opportunities and domestic over 98% on average. More specifically, for training. Joint operation company BOL
provide a total of 18,000 sanitation workers out School Aid Plan and sets up 7 projects
procurement etc. In 2018, we paid RMB 324.6 domestic procurement rate of ARMAN organised trainings for 1,400 person-times.
with cooling service in hot summer, warming for local schools, such as building internet
billion of taxes and invested RMB 6.664 billion subsidiary was 94%, and that of BOL Joint In addition to trainings required by laws, joint service in cold winter and drinking water. The infrastructure, nearly 5,000 students involved
to boost the development of local community, Operation Company was 95%, which was much venture KOA provided training on professional Programme was rewarded as one of Best and get benefit. It also assists the construction
culture, education and healthcare so as to higher than local government requirement. The skills. In 2018, joint venture KOA won an Award Practices in achieving UN SDGs by the Global of local hospitals and medical facilities to help
improve people's livelihood. Company pays attention to local training. In of Best Employer in Petroleum Industry by Compact Network China. children with major diseases and disabilities.
2018, KKM subsidiary of CIR project organised Aktobe government, Kazakhstan.

Statements from stakeholders Statements from stakeholders

Talking with Kazakhstan employees, we truly experience their recognition, love and gratitude toward Sinopec Corp. It demonstrates that host countries have SINOPEC Yanshan explores the advantages, organises volunteer service team to communicate with local people the petrochemical science and
been benefit from our overseas projects for multi-aspects, including local industry development and increase of job opportunities and personnel training. environmental protection tips and provide convinent sevices to the local community.

——Mr. Zhu Xu, a social supervisor of the Company ——Yanshan Youth League Committee of Fangshan District, Beijing
52 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Human Rights 53

Human Rights
The Company complies with laws and regulations on human rights protection, Chinese Human Rights
Action Plan and International Human Rights Conventions, resists any acts of disregard or abuse of
human rights. We prohibit child labour by strictly obeying related legal requirements of prohibition of
child labour in countries and regions where we operate; we respect employees' right of personal
freedom and right to leave and oppose forced labour; we respect rights and interests of female
employees and minor nationalities and strictly prohibit any form of discrimination due to gender,
region, religion belief, nationality, etc.; we promote employment, value common development with
employees and provide necessary resources and favorable working environment for our employees
to realise their career development according to related laws and regulations such as Labour Law
and local rules; we safeguard employees' rights and interests, strengthen social security and
consultation, and promote decent work.
54 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Human Rights 55

Chairman message:
We should be responsible for our employees, always adhere to the people-oriented development, and do better on serving what the
employees expect, so that we can inspire our talent, gather the positive energy, accelerate the reform and development and achieve
shared growth through collaboration. We should build up talents-supportive strategy to nurture successors with both capability and
morality, provide better environment for talent growth, enhance the value of human resources, and cultivate more entrepreneurs,
scientists, technological leaders and country experts.

Our Actions
Employee protection
We adhere to the principle of equal
consultation. Concerning the issues on the
We enhance development of a better salary
and welfare security system, build diversified
We establish the female employees' committee
under the Labour Union, strengthen work safety
Career development
basic rights and interests of employees, such incentive system. In accordance with the protection, and constantly improve working
as labour reward, rest and vacation, social relevant regulations of China and local environment and conditions for them. We also We firmly committed to a new talent development philosophy and implement overall design on the staff training based on the requirements of strategic deployment
security and safety protection, the labour union governments, the Company participates implement regulations on female employees' and long-term development for the capability of employees. In 2018, RMB 748 million was invested in vocational training, and covering 75% of the total.
extensively solicits the opinions of employee in local social insurances such as pension leave during maternity and lactation periods
representatives and submits to the Workers' insurance, medical insurance, work-related as well as the regular medical examination
Congress for approval. injury insurance, maternity insurance, system, and care for their physical and mental • We focus on all kinds of talent teams building, talent growth channels building and establishment of talent selection and evaluation mechanism.
unemployment insurance, and establishes an health. The Company values the construction
We guarantee the right of normal work, rest
enterprise annuity system. For the employees of a diversified workplace, and the proportion
and vacation of employees, and create a warm,
from subsidiaries with difficulty in business of female employees has been increasing.
healthy, green and safe working environment
operation, the Company helps them to find new In 2018, the proportion of female employees As for managers, comprehensive As for technical experts, we develop As for skilled operators, besides
for them. We don't restrict employees' choice
jobs through adaptability training or recommend was 35%, of which the proportion of female trainings for 35, 40 and 45-year-old leading experts training programmes professional qualification trainings and
of new jobs, nor do we restrict their personal
to other enterprises etc. managers was 12.67%. personal are carried out. and expert seminars. We also promote job adaptability training carried out by
freedom in any way. We definitely forbid any
the training of young technical personnel subsidiaries, we launch a programme
forced labour.
by implement a series of key technical of comprehensive training for skilled
backbone training projects. masters and organise the training
projects for top skilled talents in different

Occupational health types of work.

We position the health of employees in the and monitored the harmful factors including was under controll. In view of the rising trend
core of corporate development, and set the harmful substances in 90,000 workplaces of the number of employees suffering from
• Targeting the talents and personnel with doctor degree introduced in recent three years, we carry out comprehensive ability training classes and innovative
goals of "zero injury", "all dust and poison and dust in 4,000 work spots. For work spots cardiovascular and cerebrovascular diseases,
ability training classes.
concentration in the workplace should comply that exceeded the standards, we carried we carried out health risk investigation of
• Headquarters of the Company launch the programme to introduce talents from the top 30 universities in the world. We formulate personalised and
with the standards" and so on. We integrate our out treatment and re-examination to ensure employees, timely assessed the staff health
systematic training programmes according to each graduate's major, characteristics and development goals.
health management resources to promote the the health and safety of employees. After status and job adaptability, and took effective • The online course of Sinopec Online Academy (distance training platform) has been developed. In 2018, 1.23 million participants had logged in to study the
integrated management of occupational health, continuous treatment, the detection coverage intervention measures to reduce the risk of post courses, and the totaling learning time reached 600,000 hours.
physical health and mental health of employees rate of dust and toxic substances was more disease outbreak.
on the basis of occupational disease prevention than 99%, the qualification rate was more
and control. In 2018, our subsidiaries inspected than 99%, and the occupational health risk
56 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Ethics 57

Ethics
The Company complies with all national laws and anti-corruption regulations, and laws and
regulations of countries and areas where we operate. We keep promoting the enforcement of
anti-corruption measures and carry out punishment and prevention mechanism in order to
build a clean company.
58 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Human Rights
Ethics 59

Chairman message:
We should resolutely prevent the managers from abuse of power by using Sinopec Corp.'s platform and resources to do business. The
work should focus on key areas and key processes such as engineering, construction, procurement, and product distribution.

Anti-corruption System Enhancing Anti-corruption Awareness

Integrity is the ethics that all the employees Communist Party of China, including CPC within three years. In 2018, 20 suppliers were We organise trainings on anti-corruption for all senior managers and online trainings of laws and regulations on integrity for all employees every year, and
must follow. We have formulated the Code Code of Integrity and CPC Self-Discipline, penalised by the Company. compile corruption cases and hold seminars to strengthen anti-corruption awareness every year.
of Conduct, Implementation Rules of Gift Regulations on Disciplinary Measures, and
We have established independent departments
Registration and other regulations. In 2018, CPC Accountability Regulations, etc.
to take charge of inspection, investigation and Anti-corruption trainings Coverage of anti-corruption Trainings on the Party's disciplines and regulations in
the Company formulated Guidelines on
Each year, employees at key positions of treatment of corruption incidents. Employees (million participants) trainings (%) respects of integrity and anti-corruption (participants)
Strengthening the Prevention and Control of

1.143 100 596,000

the Company will sign the Business Ethics can report by mail, telephone, e-mail and
Overseas Integrity Risk and Overseas Anti-
Agreement, promising to abide by business other means. We also developed a special
Corruption Compliance Handbook, analysed %
ethics. The Company signs the Letters of processing procedure to register the reported
overseas integrity risk based on relevant
Responsibility for Business Ethics with the incidents, verify the clues, and feedback the
business, and formulate specific prevention and
contractors and suppliers, and if there is any results to the whistleblowers. The information
control measures. Meanwhile, the management
violation, they will be disqualified which means of whistleblowers is kept strictly confidential.
and employees who are the CPC members
no business transactions with Sinopec Corp.
must strictly abide by the regulations of the

Transparent Operation
In 2018, we strengthened Business Information analysis on risk prevention. We developed treatment, risk reminder management, process
Disclosure System to link with ERP, contract clean risk prevention and control information authority allocation and so on, which enhanced
management, expense reimbursement, modules, preliminarily realising the functions our ability of integrity risk prevention and
e-commerce platform, e-tendering platform, of risk position management, risk information control. In 2018, a total of 3.739 million pieces
EPEC and engineering management system management, risk self-check management, of information were disclosed, and contracts
and other systems, to facilitate big data early warning information collection and involved amounted to USD 98.05 billion and
RMB 1.4 trillion.
60 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Key Performance 61

Key Performance
Operational and Financial performance
Indicators 2016 2017 2018

Total assets (RMB billion) 1,498.6 1,595.5 1,592.3

Total liabilities (RMB billion) 666.1 741.4 734.6

Revenue (RMB billion) 1,930.9 2,360.2 2,891.2

Net profits attributable to shareholders of the Company (RMB billion) 46.42 51.12 63.09

Dividends declared (RMB billion) 30.15 60.54 50.85

Dividends pay-out ratio (%) 64.9 118.4 80.6

Taxes and fees paid (RMB billion) 316.1 328.3 324.6

Oil and gas production (mmboe) 431.29 448.79 451.46

Crude oil production (mmbbls) 303.51 293.66 288.51

Natural gas production (bcf) 766.12 912.50 977.32

Refinery throughput(million tonnes) 235.53 238.50 244.01

Ethylene output (thousand tonnes) 11,059 11,610 11,512

Total sales volume of refined oil products (million tonnes) 194.84 198.75 198.32

Chemical sales volume (million tonnes) 69.96 78.50 86.60

Safety performance

Indicators 2016 2017 2018

Employee occupational health examination coverage (%) 98.9 99 99

Health check-up and health file coverage (%) 98.9 99 99

Number of newly diagnosed cases of occupational diseases 19 21 15

Safety training coverage (%) 100 100 100

Number of accidents reported 3 4 2

Number of deaths 2 3 3
62 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Key Performance 63

Environmental performance

Indicators 2017 2018 Indicators 2017 2018

Environmental compliance rate of new projects (%) 100 100 Oil & gas exploration and production segment 30.55 31.26

Consumption of comprehensive energy per RMB 10,000 of production value (tonne of standard coal) 0.496 0.496 Refining and chemicals segment 129.49 137.65

Crude oil consumption (million tonnes) 1.41 1.33 Marketing segment 2.62 2.61

Natural gas consumption (billion cubic metres) 3.35 3.83 CO2 capture (thousand tonnes) 270 1,010

Electricity Consumption (billion kWh) 28.86 30.57 Methane recovery (million cubic metres) 220 226

Coal consumption (million tonnes) 15.08 15.18

Fresh water for industrial use (million cubic metres) 1

664.56 657.46

Oil & gas exploration and production segment – 115.2 1: Fresh water for industrial use means the water resources utilised for Others: According to the requirements of Environmental Social and

– 1.99 the first time in the process of industrial production of the Company. Governance Reporting Guide of HKEx, listed companies should
Water intensity (m3/barrel) 2
disclose the data of water consumption intensity and total
Refining segment – 192.4 2: Water intensity in oil and gas exploration segment = Fresh water
packaging material used for finished products.
consumption/domestic oil and gas equivalent production
Water intensity (m3/barrel) 3 – 0.79
• Concerning water consumption intensity, since Sinopec Corp. has
Chemical segment – 304.2 3: Water intensity in oil refining segment = Fresh water consumption/
a wide range of businesses in upstream and downstream industry
refinery throughput
3
Water intensity (m /barrel) 4
– 3.51 chains, including oil & gas exploration, development, refining,
chemicals, marketing and international trade, etc., we cannot
COD (1,000 tonnes) – 19.4 4: Water intensity in chemicals segment = Fresh water consumption/
calculate water consumption density.
chemical sales volume
Ammonia and nitrogen (1,000 tonnes) – 2.0

– 67.2 • Concerning the total packaging material used for finished products,
Sulfur dioxide (1,000 tonnes) 5: The Company conducts GHG emission (direct and indirect)
since Sinopec Corp. has dozens of subsidiaries and covers a wide
– 99.8 accounting and verification according to ISO14064-1:2006
Nitrogen oxides (1,000 tonnes)
range of businesses, which use various packaging materials such as
standards, covering six gases including carbon dioxide(CO2),
Non-hazardous waste (1,000 tonnes) – 2,229.0 iron, steel, wood, plastics and woven bags, and various packaging
methane (CH4), nitrous oxide (N2O), hydro fluoro carbons (HFCs),
Hazardous waste (1,000 tonnes) – 505.3 types such as barrels, boxes and bags in different sizes; part of
perfluorinated compounds(PFCs) and sulphur hexafluoride (SF6).
the packages can be recycled; we cannot calculate total packaging
GHG emission (million tonnes CO2-equivalent) 5 162.66 171.52
material used for finished products.
Direct 123.05 128.57

Indirect 39.61 42.95

64 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Index 65

Index
Society performance The Environmental, Social and Governance Reporting Guide of Hong Kong Stock Exchange Checklist

The Environmental, Social and Governance

Index Sinopec Information Update for 2018
Indicators 2016 2017 2018 Reporting Guide of Hong Kong Stock Exchange
A1 Emissions General Disclosure P30,P38
Social contribution per share (RMB/share) 3.606 3.778 3.966
A1.1 P62-63
Social contributions (RMB billion) 436.6 457.4 480.2 A1.2 P62-63
A1.3 P62-63
Total number of employees 451,611 446,130 423,543 Key Performance Indicators
A1.4 P62-63

Staff turnover rate (%) 0.37 0.50 0.8 A1.5 P31-35

A1.6 P39,P41
Percentage of female employees (%) 35.95 35.9 35 A2 Use of Resources General Disclosure P31,P36
A2.1 P62
Percentage of female managers (%) 12.88 12.76 12.67
A2.2 P40,P62
Collective contract coverage (%) 100 100 100 Key Performance Indicators A2.3 P31-32
A2.4 P40
Social insurance coverage (%) 100 100 100
A2.5 P63
Annuity coverage (%) 76.89 73.90 79.19 A3 Environment and Natural Resources General Disclosure P36,P38
Key Performance Indicators A3.1 P32-35,P38-43
Percentage of minority employees (%) 3.62 3.8 3.8
B1 Employment General Disclosure P52,P54
Employee vocational training (person-time) 788,352 965,930 936,143 B1.1 Refer to the Annual Report of 2018
Key Performance Indicators
B1.2 -
Investment in vocational training (RMB million) 659.33 739.56 748.08 B2 Health and Safety General Disclosure P22,P54
B2.1 P64
Vocational training coverage (%) 67.5 72.4 75
Key Performance Indicators B2.2 -
Percentage of employees with membership of labour union (%) 100 100 100 B2.3 P24-26
B3 Development and Training General Disclosure P55
Donations (RMB million) 133 152 180 B3.1 P55
Key Performance Indicators
Number of patients cured under the Lifeline Express Programme B3.2 P55
3,248 3,126 3,456
B4 Labour Standards General Disclosure P54
Contributions to cultural education, community development and medical service (RMB million) 6,584 6,652 6,664 B4.1 P54
Key Performance Indicators
B4.2 -
B5 Supply Chain Management General Disclosure P46-47
B5.1 Refer to the Annual Report of 2018
Key Performance Indicators
B5.2 P46-47
B6 Product Responsibility General Disclosure P48-49
B6.1 -
B6.2 P49
Key Performance Indicators B6.3 P50
B6.4 P48
B6.5 P49
B7 Anti-corruption General Disclosure P56
B7.1 -
Key Performance Indicators
B7.2 P58-59
B8 Community investment General Disclosure P50
B8.1 P21,P51
Key Performance Indicators
B8.2 P20,P50,P64
66 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Index 67

UNGC 10 Principles Checklist

Scope UNGC's 10 Principles Sinopec Information Update for 2018 Scope Criteria for UNGC Advanced Level Sinopec Information Update for 2018

Businesses should support and respect the protection of internationally

P05,P52,P54-55 Criterion 9: Robust commitments, strategies or
proclaimed human rights; and P05,P52,P54
Human Rights policies in the area of Labour

make sure that they are not complicit in human rights abuses. P52,P54
Criterion 10: Effective management systems to
Labour Principles P54
Businesses should uphold the freedom of association and the effective integrate the Labour principle
P54-55 Implementation
recognition of the right to collective bargaining;
Criterion 11: Effective monitoring and evaluation
the elimination of all forms of forced and compulsory Labour; P54 P11,P55
Labour mechanisms of the Labour principle integration
the effective abolition of child Labour; and P52
Criterion 12: Key outcomes of the Labour principle
P07,P11,P50,P54-55,P64
the elimination of discrimination in respect of employment and occupation. P54 integration

Businesses should support a precautionary approach to environmental

P30,P38 Criterion 13: Robust commitments, strategies or
challenges P05,P12-13,P28,P36
policies in the area of environmental stewardship

Environment undertake initiatives to promote greater environmental responsibility; and P31-32,P34-35,P38-43

Criterion 14: Effective management systems to
integrate the environmental principle P11,P38,P40,P43
encourage the development and diffusion of environmentally friendly
P34,P38,P40 Environmental Stewardship
technologies.
Implementation
Criterion 15: Effective monitoring and evaluation
Businesses should work against corruption in all its forms, P12,P31,P35,P39
Anti-Corruption P56,P58-59 mechanisms for environmental stewardship
including extortion and bribery.

Criterion 16: Key outcomes of the environmental

P07,P11,P31-35,P38-43,P62-63
principle integration

UNGC Advanced Level Criteria Checklist

Criterion 17: Robust commitments, strategies or
P05,P56
policies in the area of anti-corruption
Scope Criteria for UNGC Advanced Level Sinopec Information Update for 2018

Criterion 1: Key aspects of the Company's advanced level Criterion 18: Effective management systems to
P02-03,P05 P58
sustainability strategy in line with Global Compact principles integrate the anti-corruption principle
Anti-Corruption
Strategy, Implementation
Criterion 2: Effective decision-making processes and systems
Governance and P10-11,P12,P18,P24,P30,P38,P46-47,P58 Criterion 19: Effective monitoring and evaluation
of governance for corporate sustainability P58-59
Engagement mechanisms for the integration of anti-corruption
Criterion 3: Engagement with all important
P46-47,P50
stakeholders Criterion 20: Key outcomes of the anti-corruption
P07,P11,P58-59
principle integration
Criterion 4: Actions taken in support of broader UN
UN Goals and Issues P09,P10
goals and issue Criterion 21: Implementation of the Global
Value Chain Implementation P46-49
Compact principles in the value chain
Criterion 5: Robust commitments, strategies or
policies in the area of human rights P05,P52,P54
Criterion 22: The COP provides information on the
Report Information
Criterion 6: Effective management systems to Company's profile and context of operation
P54
integrate the human rights principle
Human Rights Criterion 23: The COP incorporates high standards
Transparency and Verification P66
Implementation of transparency and disclosure
Criterion 7: Effective monitoring and evaluation
P10,P54
mechanisms of human rights integration
Criterion 24: The COP is independently verified by
-
Criterion 8: Key outcomes of the human rights a credible third-party
P11,P50-51,P54-55,P64
integration
68 Sinopec Corp. Communication on Progress for Sustainable Development 2018 Index 69

GRI Sustainability Reporting Standards (GRI Standards) of GRI Global Sustainability Standards Board (GSSB) Index

Chapter of the COP GRI Standards Index Chapter of the COP GRI Standards Index

Report Information 102-1,102-46,102-50,102-51,102-52,102-54 Environment-Related Risks 102-15,103-1,103-2

Letter from the Chairman 102-14,102-15 Air Emissions 103-2,103-3

Company Profile 102-2,102-3,102-4,102-6,102-7 Water Resources 103-2,103-3,301-1,303-1,303-2,303-3

Core Values 102-16 Environment Solid Waste 103-2,103-3,301-3,306-2,306-4

About Us
Performance in 2018 102-45,201-1 Land Resources 103-2,103-3

2018 Honours Oil Spills 103-2,103-3

102-21,102-29,102-31,102-33,102-34,102-37, Biodiversity 103-2,103-3,304-1,304-2,304-3

Stakeholder Engagement 102-40,102-41,102-42,102-43,102-44,102-47,
102-48,102-49,103-1,103-2,405-1 Value Chain Management 102-9,102-10,103-1,103-2,414-1,414-2

102-17,102-18,102-19,102-20,102-22,102-23, Advancing Win-Win Cooperation with Customers 103-1,103-2,417-1

Sustainability Management
102-24,102-25,102-26,102-27,102-28,102-30,
System Contributing to Society Promoting Industry Development 102-13,103-1,103-2,103-3,203-1,203-2
102-32,103-2,103-3
Community Engagement 103-1,103-2,103-3,203-1,203-2,204-1,413-1
Topic 1 Green Enterprise Campaign 103-1,103-2,103-3
Public Welfare 103-1,103-2,103-3,203-1
Topic 2 Green Energy and Products 103-1,103-2,103-3,417-1
Employee Protection 102-35,103-2,103-3,201-3,401-2,401-3
Topic 3 Intelligent Operation 103-1,103-2,103-3
Human Rights Occupational Health 201-3,401-2,403-3,403-4
Topic 4 Targeted Poverty Alleviation 103-2,103-3,203-1,415-1
Career Development 201-3,401-2,404-1,404-2
Work Safety 103-1,103-2,103-3,403-4,410-1
Anti-corruption System 103-1,103-2,205-3
Contractor Safety 103-2,103-3,416-1
Ethics Transparent Operation 103-2,205-1
Safety Logistics Safety 103-2,103-3,416-1
Enhancing Anti-corruption Awareness 103-2,103-3,205-2
Cyber Security 103-2,103-3,416-1

Public Security 103-2,103-3,416-1 102-8,102-11,103-3,201-1,302-2,302-3,302-4,

Key Performance
305-1,305-2,305-3,305-7,306-2,401-1,404-1,405-1
Climate-Related Risks 102-15,103-1,103-2,201-2
Index 102-55
Improving Energy Efficiency 103-2,103-3,302-2,302-3,302-4,302-5
Feedback 102-53
Climate Change Natural Gas 103-2,301-2

Using Alternative Energy Sources 103-2,301-2

GHG Emission Management 103-2,103-3,301-3,302-5,305-4,305-5

70 Sinopec Corp. Communication on Progress for Sustainable Development 2018

Feedback
Respected Readers,

Thank you for reading this Report. Your opinions and suggestions are important to us and can help us improve the preparation of future reports. Please help
us by completing the following Feedback Form and sending it to the following address:

Secretariat of the Board

China Petroleum & Chemical Corporation
No.22 Chaoyangmen North Street, Chaoyang District, Beijing 100728, PRC

Your Information

Name:

Employer: Title:

Contact Tel: Fax: E-mail:

Content Very good Good Fair Poor Very poor

1.This Report completely and accurately describes the significant impact of

Sinopec Corp. on the economy, society and environment.

2.This Report responds to and discloses information about the concerns of stakeholders.

3.The information, indicators and data disclosed by this Report are clear, accurate
and complete.

4.This Report's logic line, content, text and wording, and layout are well designed.

Open-ended questions

1. What do you find most satisfying in this Report?

2. What other information do you think should be included in this Report?

3. What suggestions do you have for our preparation of the sustainable development progress report in the future?
http://www.sinopec.com/listco/en