National Oil Company (NOC) of Libya and a group of UAE companies have formed a company to upgrade Libya's largest oil refinery.

The Star Consortium, which includes Al Ghurair Investment's subsidiary TransAsia Gas International and ETA Ascon Star Group's Star Petro Energy, was formed as a 50:50 Joint Venture company with Libya's state oil company to own and upgrade its 10 million tonnes per year Ras Lanuf refinery.

The upgradation project, estimated to cost US$2 billion, (AED7.3 billion) will take five years to complete and would start immediately. The renovation will start in September.

It will involve revamping and refurbishment of the existing plant to increase capacity.

In the second phase, latest technology for converting fuel oil into high-value products will be added to improve the quality of products to meet latest international standards.

Under the agreement signed last February, the proposed venture, which has now been concluded, will be incorporated and registered in one of the free zones in Dubai, with offices in Ras Lanuf, Tripoli and Dubai.

The consortium is considering the Dubai Multi Commodities Centre (DMCC), among the free zones in UAE, for the venture.

The shareholder agreement was signed by Dr Shukri Ghanem, Chairman, National Oil Company of Libya, and Abdullah Ahmad Al Ghurair, Chairman Al Ghurair Investments and Star Consortium.

"This deal with Libyan National Oil Company is a major achievement for TransAsia Gas International, which clearly demonstrates its capacity to carry out work on large-scale refinery projects. By winning this JV contract, the company has moved one step closer to becoming a fully integrated energy company," said Abdullah.

Ras Lanuf refinery, first operated in 1984, produces naphtha, kerosene, light gas oil and heavy gas oil, and petrochemical units producing ethylene and polyethylene, could produce benzene and butadiene when expanded.