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Portugal closed the door to oil and natural gas research once and for all. The government’s announcement follows the departure of the last company that was looking for hydrocarbons in the country.
“No more contracts for prospecting and research of natural gas or oil will be awarded,” the official source of the Ministry of Environment and Climate Action (MAAC) told Jornal Economico.
Australis was the “last of the Mohicans” in hydrocarbon research in Portugal. The Australian company entered the country in 2015 to search for gas and oil in the West and Central areas. Five years later, he left Portugal.
According to MAAC, it was the company itself that resigned from the contract, by letter sent on August 24 to the Directorate General of Energy and Geology (DGEG). The end of the “Batalha” and “Pombal” concessions will come into effect as of September 30, 2020.
The guardianship indicates that the “company justified the resignation with the fact that, despite having made a discovery of natural gas in the ‘Batalha’ concession, with a certified dimension – independently – of 13 billion cubic meters of volume of gas, having exhausted the options to proceed due to the lack of government support for the activities / operations of the company, that is, in the company’s efforts to provide clear, concise and precise information to the populations and municipalities ”.
In turn, Australis also responded to the end of the concession. “We are disappointed that it was not possible to assess the discovery in the Batalha concession and complement the assessment of the prospect of the existence of Gas Natural in the Pombal concession.”
“Without any support for exploration and local development, the necessary gas will continue to be imported and the irony is that the environmental impact, the cost to the country and the dependence on foreign governments will be much greater than if Portugal had developed the resources discovered internally. . in an appropriate and environmentally responsible way, ”said the Australian company.
Australis must now pay the State the planned compensation. “At the level of the counterparts, the DGEG will carry out the respective collection,” according to an official source from the ministry under the supervision of João Pedro Matos Fernandes.
The Australian company will also not be entitled to receive any return value on the guarantee provided. “The company has complied with its legal and contractual obligations so there is no place for the delivered deposits to be activated,” according to the guardianship.
Contacted by Jornal Economico, Australis declined to comment.
Portugal had 18 concessions
In 2015, there were seven companies and a total of 18 concessions for oil and natural gas research in Portugal: Australis in Batalha and Pombal; Kosmos Energy off the Alentejo and Algarve coasts; Portfuel, by businessman Sousa Cintra, in the Algarve; Repsol / Partex on the Algarve coast; ENI / Galp off the Alentejo and Algarve coast; Repsol / Kosmos / Galp / Partex along the entire coastline between Lisbon and Porto.
All these companies gradually abandoned hydrocarbon research in the country. For various reasons, including an increasingly critical public opinion of these investments due to the greater environmental awareness of citizens. The concession that generated the most controversy was that of Portfuel in the Algarve, owned by businessman Sousa Cintra, which was finally canceled.
At the end of 2016, the Government terminated the contracts with the Sousa Cintra company. The businessman still appealed to the courts, but in 2019 the court denied him the claim for damages.
The controversy with Sousa Cintra dragged on over other oil research concessions in Portugal.
One of the most prominent concessions in recent years, in addition to that of Portufuel, was that of Eni / Galp on the Alentejo and Algarve coast, 46.5 kilometers from the town of Aljezur in the Algarve.
The growing challenge from municipalities and environmental associations to this investigation, together with the trials in the courts that tried to stop the project, dictated its end.
Galp said at the time that he regretted “the impossibility of evaluating the potential of the resources offshore of the country ”, noting that“ the existing conditions made it impossible to continue with the exploration activities ”.
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