2006 June 20

Sinopec Signed Its Cooperation Agreement with McDonald's

Sinopec Signed Its Cooperation Agreement with McDonald's

The joint press announcement between Sinopec and McDonald's was held on June 20,2006 indicating that the strategic alliance had been established. Taking advantage of favorable resources from both parties, Drive-Thru, an auto fast food, will be developed at gas stations, so that consumer can enjoy considerate and convenient services. On the signing ceremony, Mr. Wang Putian, president of Sinopec, indicated that more than 30 thousand gas stations supply high-quality gas and services to customers everyday. Strategic partners are needed for us to establish more value added services. McDonald's and Sinopec, both as one of top global 500 enterprises and 2008 Olympic Partners, have the common vision for expanding new business and improving service quality. We firmly believe that our cooperation with McDonald's will provide our customers more favorable and convenient services. Meanwhile, a win-win situation will be the fact after both brands have been further established.

Mike Roberts, president and CEO of McDonald's expressed his appreciation for the alliance with Sinopec who has the most gas stations in China. He said that this alliance will promote business of both sides and supply customers with brilliant services. Drive-Thru is one of focus for McDonald's to expand its business in China. Sinopec offers a strong platform for development with its nationwide gas station network. Alliance of outstanding brands and supplemented resources from both sides can make our cooperation successful.

Sinopec, ranked 31 among global top 500 enterprises, has a nationwide refined gas retail network. McDonald's, ranked 34 among global top 500 enterprises, is the biggest fast food chain store. McDonald's has more than 30 thousand chain restaurants in 120 countries and regions around the world.

Cooperation between Sinopec and McDonald's bears great significance for both parties.

Drive-Thru business offers more convenient and favorable services to customers of Sinopec and promotes its gas services at gas stations. This is beneficial for Sinopec to establish it image and cultivate customer loyalty. Addtionally, Sinopec reaps more economic benefits as well as higher real estate use efficiency.

McDonald's can take advantage of expanded retail network of Sinopec to promote its new business model, so that brand can be established with high speed growth.

As Chinese customers are going for high-paced life, convenience is becoming more and more important for them. Auto fast food serves this kind of life style. With Drive-Thru service, drivers can enjoy fast food and services of McDonald's without stepping out of thier vehicles. After being introduced to Asia, Drive-Thru is prevailing. Currently, there are more than 1000 Dive-Thru restaurants in Japan, Singapore, Malaysia and China Taiwan.

According to the cooperation agreement, Sinopec and McDonald's will choose appropriate gas stations together for Drive-Thru restaurants. Trial will be conducted at Beijing, Shanghai, Guangzhou, Tianjin, Wuhan, Shenzhen, Dongguan and other big and middle-sized cities. After that, it will be expanded nationwide.