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China & Syria Close Contract On Joint Venture Oil Refinery

China and Syria have signed papers on building a joint venture refinery in eastern Syria, expanding their cooperation to include oil processing, China National Petroleum Corp. said in a statement seen Tuesday

China and Syria have signed papers on building a joint venture refinery in eastern Syria, expanding their cooperation to include oil processing, China National Petroleum Corp. said in a statement seen Tuesday.

The agreement was signed April 2, during a visit to Syria by Li Changchun, a member of China's powerful Politburo, the company said.

It calls for state-owned CNPC, China's biggest oil and gas company, to build a refinery with an annual capacity of 5 million tons, it said.

No financial terms were mentioned. Earlier, the two sides were in talks on a US$1 billion refinery project, but Syrian media reports said the planned capacity was expanded from 70,000 barrels a day to 100,000 barrels a day, raising the cost to US$1.5 billion.

CNPC is to shoulder 85 percent of the costs of the project, which is expected to begin operations by late 2011, the state-run newspaper Shanghai Daily reported Tuesday.

China's state-owned oil industry has been investing heavily abroad in hopes of securing energy supplies to fuel its booming economy.