Portugal seeks investment commitments for Sines refinery in Moeve-Galp deal
Portugal wants Spain's Moeve and Galp to invest in and commit to the long-term viability of the Sines refinery as part of the planned merger of their refining operations, the Portuguese Environment Minister said on Wednesday.
Since January, Moeve and Galp have been negotiating the creation of two joint businesses - one operating 3,500 fuel stations throughout the Iberian Peninsula, and another combining Galp's refinery in the southern Sines area with Moeve's refineries in southwestern Spain's Huelva and Algeciras.
Moeve would hold a majority stake in the refining business, which would be one of Europe's biggest, while Galp would retain a stake of just over 20%.
Environment Minister Maria da Graça Carvalho said the government had been closely monitoring the deal from the perspective of security of supply and national sovereignty.
She said it was fundamental to ensure the continuity and sustainability of operations at the Sines refinery - the only one in Portugal - in the long term.
"The Sines refinery will have to be guaranteed the conditions needed to increase investment, modernize infrastructure and production processes," she told a parliamentary hearing.
Carvalho said it was also necessary to attract skilled workers, foster innovation and create other business and industrial synergies.
She added that the current geopolitical backdrop, including tensions in the Middle East and elsewhere, underscored the need for Portugal to reduce its dependency on fossil fuels and strengthen its infrastructure by preparing it for the future.
To this end, the refinery needed to increasingly focus on so-called green molecules, including hydrogen, sustainable aviation fuel and second-generation biofuels.
While the government has no veto powers, the strategic importance of the Sines refinery to Portugal gives it leverage to seek commitments on the asset's future direction.
The Portuguese state also holds an 8% stake in Galp.
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