Chefs love its umami flavour. Diners love its exclusive-sounding name. It's expensive yet versatile, labour-intensive but stores well for months.

It's XO sauce, one of Hong Kong's culinary gifts to the world and, right now, the darling of Australian chefs.

Across the country, restaurants are unhitching the Cantonese sauce from its usual sidecars of dumplings, rice and stir-fries and pairing it with burrata cheese, steak tartare and pizza. Some are even playing with the fundamentals of the recipe itself.

While there's no official ingredient list for XO, which dates to the 1980s, the widely accepted base is a holy trinity of dried seafood, chilli and aromatics such as shallots. After several hours of careful simmering, they come together to make a deeply savoury condiment.

It's rare that vegetarian diners get to experience that kind of flavour profile, but chef Tom Bromwich of Darlinghurst wine bar Love, Tilly Devine has given it his best shot with a meat-free carrot XO. It uses smoked soy sauce and honey to replicate some of the original's complexity and Bromwich serves it with creamy burrata cheese.

"It's a bit of poetic licence to call it an XO sauce given so many of the ingredients are altered from a traditional XO recipe, but I guess I didn't have any other name for the process," he says, referring to the building of flavour in a base of oil.

Pipis with XO sauce, one of the best-known XO dishes in Sydney thanks to Chinatown icon Golden Century, is also a crowd favourite at Karkalla in Byron Bay, where it gets a very Australian twist.

Chef and owner Mindy Woods, a Bundjalung woman, wanted the dish to celebrate the native Australian tradition of gathering pipis, so she added some of the dried bivalves to her XO sauce to replace dried scallop.

Versatility is a big part of XO's allure. Lilymu in Parramatta serves a variation that's completely free of pork, as many of the restaurant's customers are Muslim.

Lilymu chef Brendan Fong, who first learned how to make the condiment while working at Mr Wong in the CBD, experimented with smoked chicken to replace the Jinhua ham common in many Hong Kong recipes. Then he settled on smoked turkey, which held up better in the long, slow cooking process.

Fong's version of XO mimicked the traditional sauce so well that his boss Ibby Moubadder – a practising Muslim – spat it out.

The popularity of XO has been building for several years – scan the The Good Food Guide 2022 or restaurants' summer menus and you'll see those two conspicuous letters appear often. With Lunar New Year celebrations beginning on Monday, XO is set to become even more prevalent in Sydney over the fortnight-long festival.

In a quick-fix world, the slow and careful preparation (sometimes taking a whole day) are one attraction of XO, described by Chinese food authority Tony Tan as "the world's most luxurious dip". The expense of ingredients such as dried scallops, Jinhua ham and, to a lesser extent, dried prawns also helps.

Brendan Fong likes to serve it with similarly luxe ingredients, such as crab, scallops or steamed oysters. "The amount of time and effort you put into it, you may as well serve it with something also expensive," he says.

More pragmatically, XO sauce's long shelf-life is a bonus in the uncertain world of a pandemic. Chef Adrian Li of Melbourne CBD restaurant La Madonna says he still has some of the traditional, more expensive XO he made during COVID lockdown last July.

Fong believes XO's license to adaptation also appeals to a chef's ego. "Everyone wants to make something their own … to enhance that sauce to make it the best it can be," he says.

While he has an XO pipi and noodle dish on Lilymu's menu, Fong wasn't afraid to also pair the sauce with scampi and wok-fried pasta. He says it's a tongue-in-cheek addition to the "is pasta actually Chinese" debate, but also a delicious way to cook fusilli and give it a smoky flavour.

But among all the XO toasties, gnocchis and burratas, are there cries of appropriation or bastardisation?

"XO has always been one of those ingredients you only saw in Chinese restaurants but I think it's kind of cool to see it in other places now," says Fong, who grew up in a Chinese-Fijian household.

"In every country, there is some sort of Asian community. These communities have to adapt their recipes to the ingredients they can get in their new country."

Although adaptations are today being created by non-Asian chefs, he believes this is normal given Asia is Australia's closest neighbour.

Love, Tilly Devine's Tom Bromwich compares XO to ras el hanout, a Moroccan spice blend that varies from family to family, shop to shop.

Tony Tan sees variations as just another evolution of the 36-year-old sauce. "If somebody really wants to use a particular sauce – be it from France or Australia or wherever – they can always have the freedom to use it, so long as they are not going to say that they created it."

While it's still a baby as far as Chinese culinary traditions go, XO has already made a mark.

Five extra special XO dishes for Lunar New Year

XO pipis at XOPP by Golden Century

Golden Century's iconic Sussex Street site may have shuttered last year, but its sister restaurant XOPP is still open nearby in Darling Square. Given XOPP is named after its most popular dish, you already know what to order, but ask to see the special Lunar New Year menu for lobster and abalone too. Shop 31, 1 Little Pier Street, Haymarket.

Wok-fried fusilli with scampi and XO at Lilymu

Chef Brendan Fong also serves market-price pipis with XO, but for something more left-field try the $48 pasta where his pork-free version of the sauce compliments scampi's natural sweetness. King crab with eight-treasure rice on Fong's Lunar New Year menu sounds like another winner. 153 Macquarie Street, Parramatta.

XO lobster with longevity noodles at Amah by Ho Jiak

Extra long egg noodles to symbolise long life are a Lunar New Year tradition and Malaysian restaurant Amah is serving them with market-price lobster and XO for the festival's duration. Available until February 13. The District at Chatswood Interchange, 436 Victoria Avenue, Chatswood.

Wok-fried mud crab with house-made XO at Mr Wong

Starting with a Lunar New Year dumpling special featuring Hokkaido scallop, prawns and caviar is the right idea Merivale's flagship Cantonese restaurant, which also offers live mud crab cooked with your choice of XO, garlic butter or black pepper "Singapore style". 3 Bridge Lane, Sydney.

Tiger prawns with house-made XO at Lotus

The Barangaroo site of Lotus Dining Group's small dumpling empire is wok-frying prawns with the dried chilli sauce as part of a $98 per-person banquet which also includes steamed whole fish and duck pancakes. Available until February 13. Shop 8-9 Wulugul Walk, Barangaroo, Sydney.

With Callan Boys