In the coming months, the shape of fuel refining in Portugal could be reshaped. A deal now being negotiated between Galp and the Spanish group Moeve would establish a major Iberian refining and fuel distribution player, with the Portuguese company holding a minority stake of roughly 20%.
Galp–Moeve plan: the Sines refinery joins a new Iberian group
The package includes the Sines refinery, which would be transferred into this new vehicle. That would mean that effective control of the country’s only refining facility would no longer be entirely in Portuguese hands, as it has been until now. In return, Galp - in which the State participates via Parpública with an 8% stake - would gain greater scale in Spain, commercial integration, and access to two refineries across the border.
From a corporate perspective, the logic is easy to follow. The industry is under intense strain: the energy transition, squeezed margins, refinery closures across Europe, and the need for heavy investment to decarbonise. In a continent where scale has once again become a condition for survival, the prospect of building a “European champion” in this field is understandably appealing - even if Repsol’s leadership does not seem to be under threat.
A difficult moment: defence spending, strategic autonomy and energy security
Even so, the timing could hardly be worse. The world has changed - or is changing - at breakneck speed. Europe is once again preparing for a scenario it believed belonged to the past: the possibility of war within its geographic space, beyond Ukraine’s borders.
EU member states are debating defence outlays on the order of 5% of GDP. Terms such as strategic autonomy, industrial resilience and security of energy supply are back in frequent use. All of this has returned to the centre of statecraft - though, in truth, it never really left.
That context raises strategic questions for which I hope we are never forced to find answers. In the event of a severe rupture - conflict, prolonged scarcity, a state of emergency, and so on - whose interest would guide the operation of that infrastructure: Portugal’s or Spain’s?
What Portugal’s ministers have said about Sines
Manuel Castro Almeida, the Minister of the Economy, has also acknowledged how important it is for control of the Sines refinery to remain on Portuguese soil. “It would be better for us to have a refinery fully controlled from Lisbon. It is the only Portuguese refinery that carries relevant weight in our economy and in the country’s sovereignty,” he said last week at the “Capital Conversation” conference organised by the “Business Journal/Antena 1”.
Day-to-day responsibility for this brief, and the monitoring of it, is being handled by the Minister for the Environment and Energy, Maria da Graça Carvalho, whose background in these matters is highly relevant. She says she is “aware of the advantages and the possible disadvantages” of the transaction.
Asked whether national energy sovereignty is at risk, she dismisses that. “I am very much in favour of an open market. We have a great deal to gain from an open market. Those who close themselves off do so because they are afraid.” I would not be so categorical. The Minister’s confidence and experience should reassure us, but they should not dull our vigilance.
Sines refinery and sovereignty: what history suggests in extreme scenarios
In the most extreme circumstances, history has shown that states almost always prioritise their own interests. And while we are talking about fuel, we could just as well be talking about water. We all remember the recurring tensions and disputes between Portugal and Spain over the management of dams on shared rivers (the Douro, the Tagus and the Guadiana), with Portugal accusing Spain of holding back water for hydroelectric purposes while disregarding the minimum flows agreed under the Albufeira Convention.
For that reason, whatever the future brings, it matters that we keep in mind that the Sines refinery is not merely an industrial asset. It is also a tool of sovereignty - a dimension that becomes more significant as we try to anticipate the problems that will trouble Europe’s future. There are many; energy security is one of them.
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