The governments of Australia and Western Australia will conduct a jointly funded AU$4 million pre-feasibility study for a new large-scale oil refinery in the state, to be built by Perdaman, according to a Tuesday statement.

The proposed refinery is expected to create thousands of jobs, boost the local economy, and help secure diesel for regional communities in Western Australia.

This is the first agreement to be signed as part of the Australian government's AU$10 million support for feasibility studies into furthering fuel refining capabilities, as it seeks to retain current refining capability in the decade beyond 2030, per the statement.

Australia currently has two oil refineries: in Brisbane, Queensland and in Geelong, Victoria.