The 100,000 barrel-a-day (b/d) refinery will be located in the Abu Khashab area of Deir Al Zor in the east. The facility will refine heavy Syrian crude oil as well as other types of crude. It is due to be completed by 2011.
A joint venture of CNPC and the local Homs Refinery Company will be set up to carry out a feasibility study into the project, according to the official Syrian Arab News Agency.
CNPC will fund 85% of the project, with the remaining 15% to be provided by the Syrian government. Under a second agreement, China will provide Syria with $3m to finance projects in the oil, telecoms and agriculture sectors.
CNPC launched its oil and gas operation in Syria in 2002 and now has oil and gas assets and interests in the country, while also providing oilfield services.