In an interview with Bloomberg, Portugal’s Economy Minister Manuel Castro Almeida said that the Portuguese government is prepared to approve Galp’s planned merger of its Iberian refining and fuel retail businesses with Spain’s Moeve, provided the deal protects the strategic role of the Sines refinery.

Transaction talks

Sines is Portugal’s only operating oil refinery, ECO News reports, and according to Castro Almeida, the government has been in talks with Galp over the transaction.

In January, Galp said that it planned to combine its downstream businesses with Moeve, and expected to complete the deal in the coming months. Under the plan, Galp would contribute one refinery, and Moeve would contribute two, to an industrial joint venture in which Galp would hold more than 20 percent, while Moeve’s shareholders would own the rest. The companies would also separately combine their fuel station networks in a roughly 50-50 venture, ECO News reports.

Strategic asset

According to Castro Almeida, the government’s main concern is Galp’s refinery in Sines, which he described as an asset of “evident strategic value.” He added that the state has an obligation to put the country’s interests first when assets of that importance are involved.

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