Galp and ENI pull out of Aljezur drilling concession
On the face of it, it is the news everyone in the Algarve will have been waiting for.
This morning, in conversation with journalists over the corporation’s recent trimestre posting of 251 million euro in profits, GALP Energy’s executive president Carlos Gomes da Silva said: “In relation to Portugal, we have taken the decision to abandon exploration”.
It was already clear that drilling planned for this year was going to be delayed (click here) but admission that GALP has at last given up is key.
Or is it? Reaction from eco groups and conservationists fighting exploration is taking its time – for the simple reason that this could so easily be ‘just another bend in the road’.
The GALP/ ENI concession covering huge tracts of ocean off the west coast of the Algarve and into the Alentejo, remains ‘active’.
GALP pulling out or staying in, with or without ENI does not change government policy – and that’s what this fight has been about up until this moment. All the groups fighting fossil fuel exploration in Portugal want the concessions that cover large tracts of coastline and areas onshore to be cancelled, once and for all.
Thus the news today is ‘open ended’. GALP has pulled out – and as we wrote this text, Italian partners ENI appear to have confirmed that they have too.
The official story, released by negocios online, is that the government “does not intend to launch new concessions until the end of its legislature” (which falls next October).
The paper refers to the moratorium, announced last May, when foreign affairs minister Augusto Santos Silva, insisted that if viable reserves of oil were found these would allow Portugal to reduce its dependence on imports.
Activists at the time refuted this, citing the terms of contracts in place: the deals involve Portugal paying full whack for any oil or natural gas produced here. Thus, perhaps concessions in the future would change that?
GALP’s argument for retaining the licence to drill was that it had spent over 76 million euros in research into gas and oil exploration over the last decade. That was largely torn to shreds by activists (click here) – and now the corporation has declared profits that see the company vastly better off than this time last year (a liquid percentage increase of 54%: totals for the year so far up €598 million).
Thus, it’s still too soon to say whether this is the moment the country turns back from commitments to the oil industry.
But it’s definitely time for ‘local celebrations’: the summer was pitted with events reiterating local populations’ opposition to drilling of any kind, and the next 12 months at least will give opponents ‘breathing space’.