Portugal: Sines oil refinery – a new direction

It is most disconcerting, to say the least, to hear that the government has only until the end of July to avert the fall of this national asset unto the realms of foreign investment.

The amalgamation of the Spanish Moeve and Portuguese Galp companies to form the largest oil refining and energy group within the EU was agreed last January after receiving proposals from sovereign wealth investors led by the Carlyle Group, one of the largest and most influential private equity groups in the world.

Two distinct entities will emerge.

The Industrial Company will be controlled by Carlyle and its investors, with Galp holding a minority stake of 20%. The combination of Moeve’s three existing refineries with that of Galp will result in crude processing of 700,000 barrels daily. All four hubs will gradually focus on the production of biofuels and green hydrogen.

The Retail Company will be under the joint control of Galp and Moeve stakeholders. It will create an Iberian network of not less than 3,500 service stations which will include a new charging infrastructure for electric vehicles and provide extended commercial services in roadside shops and maintenance facilities.

Galp will retain exclusivity for its expanding network of green electricity plants (renewables), its lucrative division for global exploration and its place in international markets for trading energy.

What concerns the Portuguese government is that this amalgamation of interests by a foreign consortium could presage a reduction or even closure of production at Sines with consequent national difficulties in the supply and pricing of combustibles.

It also directly exacerbates the economic fears that the Sines Industrial Park is potentially an enclave of entirely foreign investment in highly strategic products of growing geopolitical importance.

What concerns the EU is that this is another step in reducing its authority and could well lead to transgressions of its Acquis communautaire and aim for eventual Federation.

It would seem that little can be done to prevent a fait accompli, although legal manoeuvres concerning taxation and management may result in agreement on matters of national security.

The Carlyle Group was created in 1987 by David Rubenstein and two other legal eagles and operated in the highly competitive and ruthless market for “buying out” ailing companies for either rehabilitation and re-sale or for the stripping of assets. In both cases, massive unemployment for ageing and unproductive employees was inevitable but highly lucrative.

The group went public in 2012 making billionaires all of its founders and many of its executives. Following this, the Group has diversified into other ramifications such as the finance of arms and real estate.

In Portugal, through the Carlyle Europe Realty Fund, it is a source of capital for pan-European property funds and novice ventures in the worlds of AI and IT. In that connection, they have recently employed agents to buy up warehouse, industrial buildings and commercial centres in the districts of Lisbon and Porto, with the intention of renovating and then leasing to e-commerce tenants.

In March 2026, Carlyle sold the Penha Longa Resort which it had bought in 2018. Earlier, it had relinquished its majority holding in the Cascais packaging company Logoplaste and now maintains a relatively low profile.

Also read Sines – Energy for the way ahead

Roberto Cavaleiro

Roberto Cavaleiro has been resident in Portugal since 1989 and possesses dual Portuguese/British nationality. Now in his 10th decade, he devotes much of his senility to the composition of essays, poems and commentaries on a diversity of Portuguese subjects.