President Donald Trump on Tuesday announced the construction of a refinery on the southern U.S. border backed by India’s Reliance Industries (RELI.NS), opens new tab, operator of the world’s biggest refining complex.
Trump made the announcement as drivers react to spiking gasoline prices since the start of the U.S.-Israeli war with Iran, and while Republicans and Democrats prepare for midterm elections that could determine which party controls Congress through the last two years of his presidency.
“Thank you to our partners in India, and their largest privately held Energy Company, Reliance, for this tremendous Investment,” Trump said on social media platform Truth Social.
The 168,000 barrels-per-day (bpd) refinery will be built at the port of Brownsville and will offset $300 billion in the trade deficit with India, startup America First Refining said in a statement.
Reliance did not respond to an emailed request for comment.
“For the first time in half a century, the United States will build a new refinery designed specifically for American shale oil,” said America First’s chairman and founder, John V. Calce.
Many Gulf Coast refineries are unable to process light, sweet crude oil from fracking shale fields because they were configured in the last 40 years to run lower-cost heavy, sour crude, which has higher density and contains more sulfur.
A “global supermajor” has provided a “9-figure investment” at a “10-figure valuation,” America First said.
Trump named the investor as Reliance, India’s largest private-sector company.
Reliance has signed “a binding 20-year offtake term sheet” with America First, meaning it will buy products the refinery produces. That will help cut India’s trade surplus with the U.S., which has been a Trump grievance.
America First said it plans to break ground in the second quarter of this year.
