Oil and Gas

Portugal's Galp to shut Matosinhos refinery, focus on larger Sines

LISBON, Dec 21 (Reuters) - Portugal’s oil and gas company Galp will fully cease processing hydrocarbons at the smaller of its two refineries, in Matosinhos near Porto, from next year due to the impact of the COVID-19 pandemic and the regulatory environment, Galp said on Monday.

Instead, it will concentrate its downstream operations and their future development at the 220,000-barrels-per-day Sines refinery equipped with deep conversion units.

Production at Matosinhos, with a 100,000 bpd capacity, has been suspended since Oct. 10. The book value of the Matosinhos assets to be decommissioned is around 200 million euros ($244 million), Galp said, expecting annual fixed costs and capital expenditure to drop by about 90 million euros as a result.

It said it would maintain the import, storage and distribution facilities there and that fuel supply in Portugal would not be affected.

Traditionally a refiner, Galp has joined the world of big oil over the past decade thanks to its stakes in various major offshore oil and gas fields in Brazil. ($1 = 0.8212 euros) (Reporting by Andrei Khalip; Editing by Nathan Allen)