On June 20, 2006, Sinopec and McDonald?s held a news release in the Great Hall of the People in Beijing to announce the establishment of the strategic alliance between the two parties. ?Drive-Thru? restaurants will be set up in Sinopec?s gas stations so that the Chinese consumers will enjoy more convenient services. At the release meeting, a signing ceremony for the cooperation was held by Sinopec, McDonald?s and Oriental Creation.

On the signing ceremony, Mr. Wang Tianpu, President of Sinopec said, ?Sinopec owns over 30,000 gas stations in China, providing quality oil products and service for millions of consumers every day. The value-added service in gas stations is an important business undertaken by Sinopec. We need reliable strategic partners. Both as Global 500 companies and partners of 2008 Beijing Olympics, Sinopec and McDonald?s share the same aspiration in improving service standards and exploring for new services. We believe that the cooperation with McDonald?s and ?Drive-Thru? restaurants will provide better service for customers and improve brand value for both sides to achieve a win-win outcome.?

According to Mr. Jeff Schwartz, CEO of McDonald's China, McDonald?s is more than happy to form strategic alliance with Sinopec who has the most gas stations and largest market coverage in China, and hence expand business for both parties and provide quality service for consumers. ?Drive-Thru? restaurants will be a key business for McDonald?s China. Sinopec?s retail network offers a strong platform for McDonald?s. Through the alliance of the strengths and complementarity of resources, the cooperation will be a round success. On the ceremony, Mr. Mike Roberts, President and COO of McDonald?s extended congratulations in his speech.

The cooperation between Sinopec and McDonald?s is the combination of the strengths which is of strategic importance to the development of both parties.

For Sinopec, fast-food service in gas stations will bring more convenient and quality service to customers, promote the development of fueling business and enhance the Company?s brand image.

For McDonald?s, with the help of Sinopec?s well-established retail network, it can expedite its business development and expand its network in China. At the same time, McDonald?s is actively introducing the new dining model??Drive-Thru? restaurant. The cooperation with Sinopec can help establish the brand image of ?Drive-Thru? rapidly.

With the improvement of people?s livelihood, the growing number of cars and the fast life pace, Chinese consumers pursue a more easy-going way of life. The development of car restaurant caters to the need of Chinese consumers? fast-changing life styles. ?Drive-Thru? is the special name for McDonald?s car restaurant. Drivers can enjoy McDonald?s food and service without getting out of the car. After entering into the Asian markets, ?Drive-Thru? is well recognized by local consumers. Up to date, McDonald?s has opened over 1,000 ?Drive-Thru? restaurants in Japan, Singapore, Malaysia and Chinese Taiwan.

In line with the strategic cooperation agreement, Sinopec and McDonald?s will jointly select suitable gas stations to open ?Drive-Thru? restaurants so that customers can enjoy easy, fast and quality dining service. The first restaurants will be opened in large and medium cities including Beijing, Shanghai, Guangzhou, Tianjin, Wuhan, Chengdu, Shenzhen and Dongguan, etc., with more to be set up nationwide step-by-step.