Kuwaiti Islamic investment firm Adeem Investment Company is planning to raise $2bn to partly finance the refinery, said Dinesh Dhume, senior vice-president of corporate finance.

"We have looked at a number of locations and Bahrain is one of them," he said.

Three other regions being considered are: Middle East-North Africa, East Africa and Asia.

A final decision on where to locate the plant would be taken by the end of September, he added.

US-based Taylor-Dejongh have been appointed advisers to the project.

Adeem is aiming to pay for the project through an energy and natural resources fund, and will contribute up to $250 million of its own money.

The fund would raise a 40 per cent equity portion of the refinery"s $5bn price tag. The rest was to be raised through debt.

Adeem was part of a group that bought luxury British carmaker Aston Martin for £479m ($925mn) in March this year.

PIN/GULFDAILYNEWS