President Donald Trump said the US would get its first new oil refinery in 50 years with the help of investment from India’s Reliance Industries Ltd.
“I am proud to announce that America First Refining is opening the FIRST new U.S. Oil Refinery in 50 YEARS in Brownsville, Texas,” Trump said on Tuesday in a post on Truth Social.
He thanked India’s “largest privately held energy company, Reliance” for the “historic $300 billion deal — the biggest in the US history”.
Reliance, promoted by billionaire Mukesh Ambani, did not comment on Trump’s social media claims.
In a media statement, America First Refining (AFR), a private company, did not mention RIL, but claimed it had received a 9-figure investment from a global supermajor at a 10-figure valuation in February.
Going by that assumption, the investment by the “global supermajor” is unlikely to be more than a billion dollars. A detailed questionnaire sent to the US company went unanswered.
Sources said talks between AFR and RIL were underway and the deal contour could be along the lines claimed by the US company, but cautioned that a final agreement was yet to be signed.
In the media statement, AFR also claimed that the same “global supermajor” had signed a “binding 20-year offtake term sheet” that secures “commitments to purchase, process, and distribute American-produced energy exclusively sourced from American shale oil”.
RIL operates the world’s largest refinery at a single site in Gujarat’s Jamnagar. The refining capacity, built in two phases, is split between a domestic-focused unit and an export-oriented unit, with a combined capacity of 1.24 million barrels per day. While the domestic facility commenced operations in 2000, the special economic zone refinery started in 2008.
Given India’s surplus refining capacity, final products from the Texas refinery are unlikely to flow to India. Instead, it would be marketed in the US or traded in the neighbouring markets.
The AFR project announcement comes a month after Trump said India had made a commitment to invest $500 billion over five years as part of the proposed India-US interim trade deal, which is yet to be signed.
The project
The refinery will be geared to process American light shale oil. Unlike many existing US refineries that depend on foreign oil, this facility is not dependent on imported crude, which strengthens US national and economic security, AFR said in a statement.
From 2014 to 2024, the US exported nearly 10 billion barrels of crude while still importing roughly 28 billion barrels.
Once operational, the AFR refinery will redirect up to 60 million barrels of US crude annually back into domestic refining, the statement said. It added that the refinery, over its 20-year operational lifetime, would improve America’s trade imbalance by $300 billion.