Portugal's Galp Terminates Plan to Integrate 700,000 b/d Refining Business

en.Wedoany.com Reported - On October 26, Portugal's Galp and Spain's Moeve terminated negotiations on the integration of their refining, petrochemical and fuel retail businesses. The cooperation plan launched in January this year had originally envisaged integrating three refineries in Portugal and Spain to form an industrial platform with crude processing capacity of approximately 700,000 barrels per day, and combining the two companies' roughly 3,500 service stations into an independent retail platform. After multiple rounds of negotiations, the two parties ultimately failed to reach agreement on commercial terms and transaction arrangements.

Under the non-binding agreement signed on January 8, the proposed industrial platform would have integrated Galp's Sines refinery in Portugal and Moeve's Huelva and Algeciras refineries in Spain, with operations covering crude processing, petrochemicals, energy trading and low-carbon fuel production. Regarding the equity arrangement, Moeve's existing shareholders Mubadala Investment Company and The Carlyle Group had originally planned to jointly hold a controlling stake in the new industrial platform, with Galp holding more than 20%.

The retail business had originally been intended to be established as a separate joint venture, jointly controlled by both parties, integrating approximately 3,500 service stations across the Iberian Peninsula. The businesses concerned were expected to sell more than 6.5 million tonnes of petroleum products to direct customers in 2025, and the scope of cooperation also included electric vehicle charging, convenience retail and transport energy services.

Following the termination of the negotiations, the three refineries and the related retail network will continue to be operated separately by the original companies. Galp will retain the Sines refining and chemicals business and continue to advance local green hydrogen electrolysis and advanced biofuel projects. The company's announcement on October 26 confirmed that the operational and capital allocation priorities of its existing businesses remain unchanged, and that upstream oil and gas operations in Brazil and other regions remain an important part of its investment portfolio.

Moeve will continue to implement its energy transition investment plan of approximately EUR 8 billion, focusing its business on low-carbon fuels, green hydrogen and sustainable transport energy. In recent years the company has sold most of its traditional oil and gas production assets, and will advance the relevant project construction through its existing industrial facilities and energy retail network in the future.