The leak occurred late Saturday and poisoned 17 people, five of whom died immediately, the Zouping County government said on its official microblog.
It said five more died early Sunday, and the cause of the leak was under investigation.
The factory is next to warehouses and low-rise residential homes in a village about 60km east of Jinan, the Shandong provincial capital, AP reported, citing satellite images.
The deadly leak comes amid heightened sensitivity toward work safety in China, where authorities are under pressure to shore up safety practices and regulations after a huge chemical blast in Tianjin killed at least 140 people and left a swath of the port city in smoldering ruins.
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