Under the deal, the two companies will set up a joint venture in which each will hold a 50 per cent stake. The new company will be incorporated in a Dubai free zone and will also have offices in Ras Lanuf, Tripoli.
The first stage of the work will revamp the existing plant to bring it to its design capacity of 220,000 barrels a day, and improve the marketing of its products.
The second phase covers the expansion of the refinery and the addition of new technology to convert fuel oil into lighter products.
Work on the project is due to begin in September and will last five years.
The Star Consortium comprises TransAsia Gas International and Star Petro Energy. The group signed a memorandum of understanding for the project with NOC on 7 January.