Portugal Vows to Protect Refining Assets in Galp-Moeve Merger Talks

Portugal's government is closely tracking merger negotiations between domestic energy major Galp and Spain's Moeve, with Prime Minister Luis Montenegro vowing to deploy every available state instrument to protect the country's strategic refining capacity.

Since January, the two companies have been discussing the creation of two joint ventures. One would operate roughly 3,500 fuel stations across the Iberian Peninsula. The other would combine Galp's refinery at Sines in southern Portugal with Moeve's refining plants at Huelva and Algeciras in southwestern Spain.

Under the proposed structure, Moeve would take a majority holding in the refining business — which would rank among Europe's largest — while Galp would retain a stake of just over 20 percent.

Speaking to parliament late Tuesday, Montenegro said the government had monitored the negotiations "from day one to safeguard Portugal's refining capacity," framing the issue as one of sovereignty, strategic interest, and energy security.

"We will not refrain from using the full scope of action available to the government as a shareholder and through its regulatory authority," he said.

While Montenegro did not spell out which specific measures could be invoked, Portugal has had legislation in place since 2014 to protect strategic assets in sectors such as energy. The state currently holds about 8.4 percent of Galp.

The Sines refinery is Portugal's only such facility, giving the government significant leverage to seek guarantees about its long-term future — even though Lisbon does not hold a direct veto over the transaction.