China Petroleum and Chemical Corporation (Sinopec Corp.), a leading oil refiner, posted a net profit of 70 billion yuan (9.63 billion U.S. dollars) in 2007, Cai Xiyou, a senior executive of Sinopec Corp., told Xinhua on Thursday.

Sinopec made a net profit of 50.66 billion yuan in 2006.

Cai attributed the huge profit to cost control, resources integration and technological innovation.

Despite soaring international crude oil prices, China has kept domestic refined oil prices much lower, putting its oil refineries into red. In return, the government gave Sinopec a subsidy of 5 billion yuan to compensate for its losses at the end of 2006.

In the first half of 2007, Sinopec's profit rose on refining margins but crude oil hikes in the second half further affected its profit.

Analysts said natural gas sector become an engine of Sinopec's growth as supply shortage pushed up gas prices.

Sinopec started construction of its large natural gas project to transmit gas from southwest China's Sichuan Province to Shanghai in last August. The Puguang field in Sichuan is one of the largest and most profitable fields in China.

Sinopec gained 0.57 yuan to 23.78 yuan on Thursday at the Shanghai Stock Exchange.

(Xinhua News Agency January 4, 2008)