I figured out how to proceed. I created a text file with the desired select options and just replaced the input field from the template with the bellow code.
<?php
$file_path="FILE_PATH_HERE"; // path to the file with select options
if ( !file_exists( $file_path ) ) {
echo '<input type="text" name="location" placeholder="' . __("Location ...", "custom-settings") . '" value="' . esc_attr($location) . '" />';
} else {
$file_array = str_replace("\n","", file($file_path));
$options="<option value="">" . __("Select a location ...", "custom-settings") . '</option>';
$options .= '<option value="0">' . __("All locations", "custom-settings") . '</option>';
foreach ($file_array as $location)
$options .= '<option value="' . $location . '">' . $location .'</option>';
$select="<select id="location" name="location">" . $options . '</select>';
echo $select;
}
?>