Ukrainian energy minister Eduard Stavytsky said that the new refinery is could cost up to $2bn, Reuters reported citing Interfax news agency.
The facility is likely to be built in Odessa or the Kherson region in southern Ukraine.
Presently, the nation has six major oil refineries but only two of them will process oil regularly.
According to producers, the current tax regime creates oil processing unprofitable.
PetroChina was considering investing in construction of an oil refinery in Ukraine, Stavytsky said in 2013.
Ukraine’s oil processing has been decreased by around 26% during January and November in 2013, while its petrol production was reduced by 41%.
