China National Petroleum Corp (CNPC), the nation's biggest energy company, will spend 15 billion yuan (RM7.49 billion) to upgrade the quality of fuel it refines, general manager Zhou Jiping said.

The money would allow CNPC to upgrade the standard of its fuel to China IV from China III, Zhou said in Beijing on Sunday at annual meetings of the Chinese People's Consultative Conference.

The cost of upgrading to China V from IV would be less, he said.

China's largest oil companies have announced plans for billions of yuan of upgrades after air pollution in the Chinese capital hit hazardous levels on 20 days in January. China Petrochemical Corp chairman Fu Chengyu said in an interview with state broadcaster China Central Television last month that the nation's biggest refiner would spend about 30 billion yuan a year to upgrade its plants to produce cleaner fuel.

The nation should also aggressively increase the use of natural gas so that it accounts for a greater percentage of total energy usage, Zhou said. China should exploit both conventional and unconventional natural gas, he said, adding that the company will see more gas output from its fields in Qinghai, Sichuan and Talimu as well as Changqing.

The State Council, China's Cabinet, said on Feb 6 that all fuel will need to be at the China V standard by 2017.