May 16, 2018 / 6:56 PM / 6 months ago

Portugal environment body OKs oil well off Alentejo coast

LISBON (Reuters) - Portugal’s Environmental Agency gave its tacit approval on Wednesday to a consortium of Galp Energia and Italy’s ENI to drill an oil exploration well off the Alentejo region’s coast, a project that environmental activists are trying to block.

It would mark the resumption of drilling in Portugal after a long hiatus, with opponents arguing the risks outweigh the chances of finding any significant quantities of oil.

The agency said it had not identified any potentially significant negative effects on the environment from the planned deep-sea well, and would not order a specific study, which opponents of the project have been demanding.

Various local municipalities, politicians and activists have filed lawsuits and petitions to try and block oil exploration off the so-called Vicentine coast in Alentejo, which boasts beautiful beaches and a large natural park.

Several oil companies spudded a few dozen exploration wells in Portugal in the 20th century, but all were either dry or showed just traces of hydrocarbons. Drilling activity petered out in the early 2000s, although seismic studies have continued.

Portugal’s Galp and its partner at the time, Brazil’s Petrobras, won an exploration licence in 2007 for three blocks in the Alentejo basin. ENI bought Petrobras’ share in the blocks in 2014.

The consortium hopes to drill the well in the last quarter of 2018 after the government last January extended the exploration period for a year.

The Expresso newspaper said last month an internal study by the consortium pointed to potential oil reserves of up to 1.5 billion barrels in the area, but the companies would not publicly confirm such estimates, saying only they expected to find hydrocarbons based on seismic studies.

Climate Action Network (CAN) Europe last month named Portugal the winner of its 2018 European Fossil Fuel Subsidies anti-award for handing out the drilling licence near its protected biodiversity area and a tourism hotspot and wasting taxpayers’ money on supporting dirty energy.

Reporting by Andrei Khalip; Editing by Mark Potter

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