The new refinery, which is set to be built with an investment of around $360m, will help BP to avoid the restrictions that are imposed on exporting crude oil out of the US.
ITG Investment Research chief energy economist Judith Dwarkin was quoted by Bloomberg as saying that it is a relatively inexpensive way around the export prohibition.
"You can lightly ruffle the hydrocarbons and they are considered processed and then they aren’t subject to the ban," Dwarkin added.
BP will sell the lightly refined products that are produced in the refinery to different domestic markets.
