WHITING | BP is one step closer to receiving a $200 million loan from the sale of tax-exempt bonds to help expand its refinery.

Both the Whiting Economic Development Commission and the Whiting Common Council approved the sale of state-authorized environmental facilities revenue bonds Tuesday.

The bonds are part of the state of Indiana tax-exempt program used to stimulate economic development or build pollution control projects.

BP will use the funds to install sewage and solid waste facilities needed to process Canadian crude oil, said Tom Keilman, director of government & public affairs at BP's Whiting refinery. The company is investing $1.4 billion to expand the refinery, Keilman said.

Approval by the commission and the common council was necessary to allow the bonds to be sold, said Denise Sejna, city attorney. According to state law, the East Chicago City Council also must approve the sale of these bonds at its meeting Monday because part of BP's plant is in that city.

"BP has used the state of Indiana tax-exempt program before for construction," Keilman said. "This is a preliminary step that authorizes Indiana grants."

In addition, BP is responsible for repaying the loan, he said.

Securities firm Goldman Sachs will handle the Dec. 3 sale of the bonds to investors.

The Whiting Common Council also voted to allow additional bonds to be sold in the future.