US to set up US$ 300-bn refinery with India’s Reliance Industries’ backing

The United States President Donald Trump announced on Wednesday that the United States of America is opening its first new US oil refinery in 50 years in Brownsville, Texas, with an estimated investment of US$ 300 billion. India’s Reliance Industries Ltd (RIL) is potentially backing to set up this refinery which could be historic and the biggest in US history.

The US President said in a social media Truth Social post, “America is returning to real energy dominance! Today, I am proud to announce that America First Refining is opening the first new US oil refinery in 50 years in Brownsville, Texas. This is a historic US$ 300 billion deal – the biggest in US history, a massive win for American workers, energy, and the great people of south Texas! Thank you to our partners in India, and their largest privately held energy company, Reliance, for this tremendous Investment.”

Trump’s Truth Social further added, “It is because of our America First Agenda, streamlining Permits, and lowering Texas, that have attracted billions of dollars in deals coming back to our nation. A new refinery at the Port of Brownsville, will fuel U.S. Markets, strengthen our national security, boost American energy production, deliver billions of dollars in economic impact, and will be the cleanest refinery in the world. It will power global exports, and bring thousands of long overdue jobs and growth to a region that deserves it. This is what American energy dominance looks like, America First, Always!”

Energy dominance
The announcement comes as the White House seeks to calm market concerns over rising energy prices triggered by the conflict in Iran, and thereupon the closure of the Strait of Hormuz. U.S. President Donald Trump is weighing several measures to curb the cost of oil and gasoline, including releasing supplies from emergency reserves and providing military escorts for tankers transiting the Strait of Hormuz.

The Texas refinery project was originally being developed by Element Fuels, which said in June 2024 that it had completed site preparation and secured the necessary permits to build a facility capable of processing about 160,000 barrels of crude oil per day. Element Fuels’ website now redirects to America First Refining, the company Trump said will develop and operate the new refinery.

America First Refining said in a statement on Tuesday that it plans to break ground on the project in the second quarter of this year and has already secured a 20-year agreement to sell the refined fuels produced at the facility. The off-take agreement has been signed with Reliance. Representatives from Reliance could not immediately be reached for comment. The U.S. Department of Energy referred queries to the White House, which did not immediately respond to requests for further details.

America First
The Trump administration has been pursuing a policy of U.S. energy dominance aimed at expanding domestic production of oil, natural gas and coal. Although U.S. crude output has surged over the past decade and a half following the shale revolution, the country still relies on an aging refining network. Several refineries have also shut down in recent years, tightening domestic processing capacity. According to America First Refining, the Brownsville refinery will be designed to operate entirely on U.S. shale oil.

Previous attempts to build new greenfield refineries in the United States have struggled due to high capital costs, complex federal and state permitting processes, and environmental opposition. In the mid-2000s, for example, Arizona Clean Fuels Yuma proposed a US$ 2.5 billion refinery project south of Phoenix to process Mexican or Canadian crude, but the plan eventually collapsed after failing to secure sufficient financing.

DILIP KUMAR JHA
Editor
dilip.jha@polymerupdate.com