Caltex has confirmed it's decided to shut down its Sydney oil refinery in Kurnell, costing 330 jobs.

It's believed the facility will be converted to a 'major import terminal' which would supply imported fuel to customers.

Kurnell is one of two Australian refineries operated by Caltex, with a second facility in Brisbane.

The company has been considering closure for months since completing a viability review.

Unions warn that the closure of the plant may lead to future fuel price rises.