The China's third-largest refiner, has started building a 60,000-barrel-per-day crude processing facility in East China, to boost its still nascent refining and fuel marketing business in the world's second-largest oil market.

The new facility, to be built in Taizhou city of Jiangsu province, costs 10.2 billion yuan ($1.6billion) and is slated to begin operations in 2017.

Company officials said the new investment, including 10 main processing facilities, would be ontop of an existing plant at the same site that produces mainly asphalt and fuel oil.

The company calls the Taizhou investment an "integrated petrochemical project" instead of a"refinery", saying it would become a key lubricants producer.

It would also produce feedstock oil for petrochemicals, liquefied petroleum gas and fuel oil.

One company official said the new plant would process heavy crude oil pumped from China's Bohai Bay, off North China, the main crude producing area.

The planning graph of the factory