Sinopec Engineering Group Co Ltd. — Capital/Financing Update 2014

Feb 17, 2014

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

==> picture [47 x 48] intentionally omitted <==

中石化煉化工程(集團)股份有限公司 SINOPEC Engineering (Group) Co., Ltd.[*]

(a joint stock limited liability company incorporated in the People’s Republic of China)

(Stock Code: 2386)

VOLUNTARY ANNOUNCEMENT TOTAL NEW CONTRACT VALUE AND BACKLOG

This announcement is made voluntarily by SINOPEC Engineering (Group) Co., Ltd. (the “ Company ”, together with its subsidiaries, the “ Group ”). The board of directors of the Company (the “ Board ”) is pleased to update shareholders of the Company and potential investors with certain information in connection with the representative new contracts entered into by the Group for the three months ended December 31, 2013, the total value of the new contracts for the twelve months and the three months ended December 31, 2013, and the backlog as of December 31, 2013. The relevant information shall be subject to the information disclosed in the annual report of the Company for the year ended December 31, 2013.

This announcement is made by the order of the Board. The Board collectively and individually accepts responsibility for the accuracy of this announcement.

Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

This announcement is made voluntarily by the Company. The Board is pleased to update shareholders of the Company and potential investors the following information. The relevant information shall be subject to the information disclosed in the annual report of the Company for the year ended December 31, 2013.

During the twelve months ended December 31, 2013, the total value of new contracts entered into by the Group amounted to RMB 81.989 billion, representing an increase of 104.2% as compared to RMB 40.143 billion for the twelve months ended December 31, 2012; during the three months ended December 31, 2013, the total

* For identification purpose only.

— 1 —

value of new contracts entered into by the Group amounted to RMB 27.178 billion; and as of December 31, 2013, the backlog of the Group amounted to RMB 114.468 billion, representing an increase of 50.5% as compared to RMB 76.051 billion as of December 31, 2012.

Representative New Contracts

New contract value represents the value of the contracts the Group entered into during a specified period. The value of a contract is the amount that the Group expects to receive under the terms of the contract if the contract is performed in accordance with its terms. During the three months ended December 31, 2013, the total value of new contracts entered into by the Group amounted to RMB 27.178 billion, and contracts that are representative are as follows:

1. an EPC contract for the new coal chemical project of ZhongTianHeChuang Energy Corporation Limited (中天合創能源有限責任公司), with an aggregate contract value of approximately RMB 18.67 billion. For further details, please refer to the announcement made by the Company on December 26, 2013;

2. an EPC contract for the 1 million tons per annum (“Mtpa”) methanol to olefin and 0.5 Mtpa styrene project of Fude (Changzhou) Energy & Chemical Co., Ltd (富德（常州）能源化工發展有限公司), with contract value of approximately RMB 3.00 billion; and

3. an EPC contract for the 0.26 Mtpa acrylonitrile project of Shanghai SECCO Petrochemical Company Limited (上海賽科石油化工有限責任公司), with contract value of approximately RMB 1.27 billion.

Total New Contract Value

The table below sets out the details of the total value of new contracts entered into categorized by the Group’s business segments during the periods indicated:

	Twelve months ended	Three months ended
	December 31, 2013	December 31, 2013
	(RMB thousand)	(RMB thousand)
Engineering, Consulting and
Licensing	5,411,511	1,128,699
EPC Contracting	62,634,601	23,449,076
Construction	13,439,019	2,503,422
Equipment Manufacturing	504,333	96,806
Total	81,989,464	27,178,003

— 2 —

The table below sets out the details of the total value of new contracts entered into by the Group categorized by the industries in which the Group’s clients operate during the periods indicated:

	Twelve months ended	Three months ended
	December 31, 2013	December 31, 2013
	(RMB thousand)	(RMB thousand)
Oil Refining	6,969,953	2,413,027
Petrochemical	35,048,150	3,333,085
New Coal Chemicals	34,828,363	21,195,539
Other Industries	5,142,998	236,352
Total	81,989,464	27,178,003

The table below sets out the details of the total value of new contracts entered into by the Group categorized by regions during the periods indicated:

	Twelve months ended	Three months ended
	December 31, 2013	December 31, 2013
	(RMB thousand)	(RMB thousand)
PRC	59,294,522	27,178,003
Overseas	22,694,942	0
Total	81,989,464	27,178,003

The table below sets out the details of the total value of new contracts entered into by the Group categorized by clients of each of (1) China Petrochemical Corporation (the “ Sinopec Group ”) and its associates and (2) the non-Sinopec Group and its associates during the periods indicated:

	Twelve months ended	Three months ended
	December 31, 2013	December 31, 2013
	(RMB thousand)	(RMB thousand)
Sinopec Group and its associates	28,089,139	21,470,980
Non-Sinopec Group and its
associates	53,900,325	5,707,023
Total	81,989,464	27,178,003

Backlog

Backlog represents the total estimated contract value of work that remains to be completed pursuant to outstanding contracts as of a certain date, net of estimated

— 3 —

value added tax and is based on the Group’s assumption that the relevant contracts will be performed in accordance with their terms. Backlog is not a measure defined by generally accepted accounting principles. Any modification, termination or suspension of these contracts by the Group’s clients may have a substantial and immediate effect on the Group’s backlog. Projects may also remain in the Group’s backlog for an extended period of time beyond what was initially anticipated due to various factors beyond the Group’s control.

The table below sets out the details of the total value of backlog of the Group as of the date indicated:

	As of December 31, 2013
	(RMB thousand)
Engineering, Consulting and Licensing	6,050,017
EPC Contracting	95,939,061
Construction	12,216,820
Equipment Manufacturing	262,454
Total	114,468,352

The table below sets out the details of the total value of backlog of the Group categorized by the industries in which the Group’s clients operate as of the date indicated:

	As of December 31, 2013
	(RMB thousand)
Oil Refining	18,752,220
Petrochemical	38,675,478
New Coal Chemicals	49,659,298
Other Industries	7,381,356
Total	114,468,352

— 4 —

The table below sets out the details of the total value of backlog of the Group categorized by regions as of the date indicated:

	**As **	**of **	December 31, 2013
			(RMB thousand)
PRC			70,546,482
Overseas			43,921,870
Total			114,468,352

The table below sets out the details of the total value of backlog of the Group categorized by the clients of each of (1) the Sinopec Group and its associates and (2) the non-Sinopec Group and its associates as of the date indicated:

	As of December 31, 2013
	(RMB thousand)
Sinopec Group and its associates	36,450,335
Non-Sinopec Group and its associates	78,018,017
Total	114,468,352

The Board wishes to emphasize that the above information in relation to the representative new contracts, the total value of new contracts and backlog shall not constitute any forecast or prediction of the profits of the Group.

This announcement is made by the order of the Board. The Board collectively and individually accepts responsibility for the accuracy of this announcement.

— 5 —

Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company .

Yours faithfully, By order of the Board SINOPEC ENGINEERING (GROUP) CO., LTD. Sang Jinghua

Secretary to the Board of Directors and the Company Secretary

Beijing, PRC February 17, 2014

As of the date of this announcement, the executive director is Yan Shaochun, the non-executive directors are Cai Xiyou, Zhang Kehua, Lei Dianwu, Ling Yiqun and Chang Zhenyong and the independent non-executive directors are Hui Chiu Chung, Stephen, Jin Yong and Ye Zheng.

This announcement will be available on the website of Hong Kong Exchanges and Clearing Limited (www.hkex.com.hk) and on the website of the Company (www.segroup.cn).

— 6 —