Sinopec’s AI Integration: A Top 10 Industrial AI Strategy for Energy Markets in 2025-2026

China Petroleum & Chemical Corporation (Sinopec) is executing a pragmatic and deeply integrated artificial intelligence strategy, positioning AI as a core driver of operational efficiency and its green energy transition. The company’s initiatives demonstrate a clear focus on tangible returns by leveraging AI to solve high-value engineering and business challenges. Understanding these moves is critical for any professional navigating the energy markets. Below, we break down Sinopec‘s strategy, showing how data-driven insights can guide competitive analysis.

Sinopec’s AI Projects Signal a Shift from Infrastructure to High-Value Applications

Sinopec has progressed from building foundational digital infrastructure to deploying specific, high-return AI applications that directly support its operational efficiency and green energy objectives.

• Between 2021 and 2024, Sinopec focused on creating the digital backbone for its operations. This included building China’s first digital twin-enabled smart ethylene plant, deploying a megaton-scale CCUS project managed with advanced monitoring systems, and forming foundational technology partnerships with companies like Cummins for its green hydrogen electrolyzer factory.
• Starting in 2025, the strategy shifted towards deploying targeted AI solutions with quantifiable impact. The launch of the Sheng Xiaoli AI platform enhanced fracture network prediction accuracy in shale gas fields by a significant 40%, demonstrating a clear return on investment.
• This recent phase also includes the integration of large models like Deep Seek to optimize oil reservoir analysis and the pilot of an “AI Digital Employee” in over 40 gas stations, showing a move from industrial process control to customer-facing AI applications.
• The company is also using AI to accelerate R&D, with its AI-assisted development of polyimide gas separation materials recognized at the 2025 World Artificial Intelligence Conference, signaling AI’s role in future materials science innovation.

Sinopec Directs Billions into Digitally-Enabled Infrastructure and New Energy Tech

Sinopec‘s investment strategy allocates massive capital to modernize legacy assets with digital technology while making targeted, high-value investments in new energy ventures where AI is a critical component for success.

• Sinopec committed over $15 billion to major refinery upgrades, including the $5.7 billion Zhenhai refinery expansion and the $9.82 billion Fujian Gulei project, which are designed with advanced automation and intelligent operations from the ground up.
• The company has sustained its commitment to new energy through significant capital allocation, starting with a planned $4.6 billion investment in hydrogen by 2025 and establishing a $690 million venture capital fund for hydrogen in August 2025.
• Strategic acquisitions of technology are evident in Sinopec Capital‘s €40 million (~$43 million) investment in Forvia Hydrogen Solutions China in January 2026, a move designed to secure access to critical hydrogen mobility technology and market presence.

Table: Sinopec Strategic Investments (2025-2026)

Sinopec Forges Alliances to Accelerate AI and Clean Tech Adoption

Sinopec strategically partners with specialized technology providers and energy majors to rapidly acquire AI capabilities and market access, a method that avoids the long development cycles of building all technology in-house.

• Between 2021 and 2024, Sinopec established foundational technology partnerships, such as its collaboration with Siemens for digitalization and a joint venture with Cummins to build a 1 GW hydrogen electrolyzer factory.
• Since 2025, partnerships have become more focused on acquiring specific AI capabilities. This includes collaborating with Kongsberg Digital for its AI-integrated Kognitwin® digital twin platform, integrating the Deep Seek large model for upstream analysis, and using Clarivate‘s AI-powered intelligence platforms to enhance R&D.
• The company also uses partnerships to enter new markets, demonstrated by its €40 million investment in FORVIA‘s hydrogen business and a joint development agreement with LG Chem for sodium-ion battery materials.

Clean Hydrogen Projects by Capacity and Cost

This chart shows the competitive landscape for clean hydrogen projects, providing context for Sinopec’s strategic partnerships to enter the market, such as its hydrogen electrolyzer factory venture.

(Source: Enverus)

Table: Sinopec’s Key Technology and Energy Partnerships (2025-2026)

Sinopec Expands from Domestic Digitalization to Global Tech Deployment

While Sinopec‘s core AI-driven industrial upgrades are concentrated in China, its activities since 2025 show a clear strategy to export its technical expertise and secure energy resources globally, with a focus on the Middle East and Southeast Asia.

• Between 2021 and 2024, Sinopec‘s major tech-enabled projects were primarily domestic. Key examples include the Kuqa green hydrogen project in Xinjiang, the Qilu-Shengli CCUS facility, and extensive refinery upgrades at its Zhenhai complex.
• From 2025 onward, there is a distinct expansion of its international footprint. This is highlighted by a $4 billion joint venture with Saudi Aramco, securing an engineering contract for a major green hydrogen project in Saudi Arabia, and a $3.7 billion refinery project in Sri Lanka.
• This global push is further supported by the establishment of Sinopec Tech Middle East in late 2024, an entity explicitly created to foster collaboration on big data and AI with Saudi partners and align with Saudi Vision 2030.

Sinopec’s AI Applications Mature to Commercial Scale with Measurable Impact

Sinopec‘s AI applications have progressed from pilot-scale digital infrastructure projects before 2025 to commercially deployed, high-impact systems that now deliver quantifiable results in upstream, downstream, and new energy operations.

• In the period from 2021 to 2024, Sinopec focused on building foundational digital infrastructure. The deployment of a digital twin for an ethylene plant and the commissioning of the world’s largest green hydrogen facility at Kuqa represented large-scale pilots for embedding digital control systems into complex industrial environments.
• Since the start of 2025, the focus has shifted to commercial validation and impact. The Sheng Xiaoli AI platform is now a commercial success, delivering a 40% improvement in upstream prediction accuracy and directly improving drilling efficiency.
• The maturity is also visible in the enterprise-level adoption of third-party AI, such as the company-wide initiative to use the Deep Seek large model for improving oil reservoir characterization, moving beyond internal pilots to integrating commercially available AI.

SWOT Analysis of Sinopec’s AI-Driven Energy Strategy

Sinopec‘s strengths derive from its immense scale and capital access, but its strategic evolution reveals a growing reliance on external partners, which creates opportunities for rapid innovation alongside risks of dependency.

• Strengths have shifted from just capital-intensive construction to demonstrating tangible ROI from technology integration.
• Weaknesses related to being a slow-moving legacy player are being addressed through a formal partnership strategy, but this introduces dependency on external tech providers.
• Opportunities have expanded from domestic diversification, like leveraging its retail network for EV charging, to pursuing global technology leadership, particularly in integrated energy and AI solutions.
• Threats have evolved from the general pressure to decarbonize to more specific risks, including geopolitical tensions affecting global partnerships and the rapid pace of AI model development.

Chinese AI Models Narrow Performance Gap

The rapid improvement of Chinese AI models, now near-parity with US counterparts, provides a strong technological foundation for Sinopec’s AI-driven strategy and informs the opportunities within its SWOT analysis.

(Source: Stanford HAI – Stanford University)

Table: SWOT Analysis for Sinopec

Sinopec’s 2026 Outlook: Scaling Proven AI Applications Enterprise-Wide

For 2026, Sinopec‘s primary strategic action will be to scale its proven AI applications, moving from successful pilots like the ‘AI Digital Employee’ and Kognitwin digital twin to enterprise-wide deployment across its vast industrial and retail networks.

• Expect a broader rollout of the AI Digital Employee beyond the initial 40 pilot stations, integrating it across Sinopec‘s extensive retail network to enhance customer service and operational efficiency.
• Monitor for announcements on the expansion of the Kongsberg Digital Kognitwin® platform to other onshore and offshore assets, moving from a single pilot to creating a fully integrated, AI-optimized operational overview.
• Watch how Sinopec deploys AI to optimize the entire green hydrogen value chain, from production to logistics, as it works to solidify its position as China’s largest hydrogen supplier with its network of over 146 hydrogen stations.
• Look for developments related to Sinopec‘s stated goal to “enhance its artificial intelligence technology framework, ” which may include partnerships or in-house efforts to create more powerful, domain-specific AI models tailored to the petrochemical industry.

Frequently Asked Questions

What is the primary shift in Sinopec’s AI strategy from 2025 onwards?

Starting in 2025, Sinopec shifted its strategy from building foundational digital infrastructure (2021-2024) to deploying targeted, high-value AI applications with measurable returns. Examples include the Sheng Xiaoli AI platform for upstream prediction and piloting an ‘AI Digital Employee’ in its retail gas stations.

How is Sinopec funding its digital and new energy initiatives?

Sinopec is allocating billions to both upgrade legacy assets and invest in new energy. This includes over $15 billion for refinery modernization, a planned $4.6 billion investment in hydrogen by 2025, and a $690 million venture capital fund to invest in emerging hydrogen technologies.

What are some concrete examples of AI delivering measurable results for Sinopec?

The Sheng Xiaoli AI platform is a key example, having improved the accuracy of fracture network prediction in shale gas fields by a significant 40%. Additionally, the company is using the Deep Seek large model to optimize oil reservoir analysis and has deployed an ‘AI Digital Employee’ in over 40 gas stations to improve efficiency.

Why is Sinopec forming partnerships with companies like FORVIA and Kongsberg Digital?

Sinopec uses strategic partnerships to rapidly acquire specialized technology and market access, avoiding long in-house development cycles. The partnership with Kongsberg Digital provides an AI-integrated digital twin platform (Kognitwin®), while the investment in FORVIA secures access to critical hydrogen mobility technology in China.

Is Sinopec’s AI-driven strategy limited to China?

No. While its core upgrades are in China, since 2025 Sinopec has been expanding its technical and investment footprint globally. Key international moves include a $4 billion joint venture with Saudi Aramco, a green hydrogen project in Saudi Arabia, and a $3.7 billion digitally-enabled refinery project in Sri Lanka.