Parth Nadpara
NEW DELHI: US President Donald Trump said on March10 that the United States is set to build its “first new oil refinery” in 50 years, backed by investment from Mukesh Ambani’s Reliance Industries. Although refineries have been built in the past five decades, this is the first “major oil refinery” during this period.
In a post on Truth Social, Trump described the development as a “landmark agreement”.
The US President also hailed Reliance Industries, calling the investment by India’s largest privately held energy company “tremendous”.
Reliance operates the world’s biggest oil refinery complex in Jamnagar, India, and has a market capitalisation of about $208 billion.
According to Trump, the upcoming refinery will be built at the port of Brownsville in Texas. He said the project would enhance national security, increase US energy output and generate billions of dollars in economic activity. Trump also claimed it would be “the cleanest refinery in the world.”
The facility is expected to run entirely on American shale oil and is being developed by America First Refining.
Brownsville Mayor John Cowen Jr. said the announcement highlights the city’s growing appeal for businesses and investment in South Texas. He congratulated the Port of Brownsville for bringing in what he called a landmark project, adding that investments of this magnitude help boost the local economy, generate quality employment opportunities, and reinforce the city’s importance as a key energy and trade gateway in the United States.
Brownsville Municipality officials say a ground-breaking ceremony is expected at the Port of Brownsville in April, marking the start of construction on what is described as one of the most significant energy infrastructure developments in the United States.
The facility will be built within a federally designated economic opportunity zone and will take advantage of the port’s deep-water access to ship refined products to domestic and international markets.
What will the refinery process?
According to the Brownsville Municipality, the refinery will process American light shale oil sourced from the Permian Basin in West Texas. The initiative aims to bolster US energy security while creating employment opportunities in the market.
A 20-year offtake agreement linked to the project is expected to cover the purchase and processing of 1.2 billion barrels of US light shale oil, estimated to be worth about $125 billion.
The refinery could also produce as much as 50 billion gallons of refined petroleum products valued at roughly $175 billion. Altogether, the project is projected to contribute around $300 billion in improvements to the US trade balance while expanding the country’s refining capacity.
Once operational, the refinery is expected to produce gasoline, diesel and jet fuel at large scale using advanced technologies aimed at improving efficiency and enabling cleaner production. The plant will rely exclusively on shale oil produced in the United States.
The project is also anticipated to enhance regional infrastructure and further strengthen the Port of Brownsville’s role as a major center for energy, manufacturing and logistics.
As per the US Energy Information Administration, the “newest refinery in the United States is the Texas International Terminals 45,000 b/cd refinery in Galveston, Texas, which started operating in February 2022”. However, the US IEIA says the last refinery with “significant downstream unit capacity” became operational in 1977 in Marathon’s facility in Garyville, Louisiana.
Hence, the Brownesville refinery will be the ‘first major refinery’ since then. Till January 1, 2024, there were 132 petroleum refineries operating in the United States.
Trump’s announcement of the Reliance Industries investment and development of an oil refinery in Texas comes amid the global fears of an “oil blockade” by Iran in the Strait of Hormuz. This has led to volatility in the world market.
The price of Brent has risen nearly 30 per cent since December 31, 2025, and 17 per cent in the 12 days of the West Asia war, when Iran effectively closed the Strait of Hormuz.