Investing.com-- Tesla Inc (NASDAQ: TSLA ) is set to build a new Megafactory near Houston, Texas, Electrek reported on Wednesday citing a tax abatement agreement with Waller County.

The facility will focus on producing Megapack energy storage systems, the report stated.

Under the tax abatement deal, Waller County will provide tax incentives for property improvements, including $44 million in facility upgrades and $150 million in manufacturing equipment, Electrek reported. The project is expected to create approximately 1,500 jobs.

Elon Musk’s Tesla will repurpose a 1-million-square-foot facility at the Empire West industrial park near Katy, Texas, which was previously leased by logistics firm DB Schenker, according to the report.

The site will be converted into a Megapack production plant, with plans to add a 600,000-square-foot distribution center with some manufacturing capabilities, the report said.

The Texas facility will be Tesla’s third Megafactory, following plants in Lathrop, California, and Shanghai, China.

The company has not disclosed the plant’s expected production capacity, though existing Megafactories are designed to produce 40 GWh of Megapacks annually, Electrek noted.