Portugal holds no proven commercially viable oil reserves. According to the 2008 BP Statistical Energy Survey, Portugal consumed an average of 301.54 thousand barrels a day of oil in 2007, 0.36% of the world total and a change from 2006 of 1.56 tbpd. According to the same survey, Portugal had 2007 natural gas consumption of 4.33 billion cubic metres, 0.14% of the world total. Portugal has extremely limited domestic energy reserves and consequently imports about 90% of its energy requirements, much of which is oil (66% in 2002). The country's largest domestic energy resource is hydropower; however, its contribution fluctuates depending on rainfall, making it, to a certain extent, unreliable.
Portugal's energy imports, mainly natural gas, are transported through Spain via pipelines while oil arrives at the country's Sines and Porto terminals. Natural gas is relatively new to Portugal's energy mix, with imports from Algeria via Spain beginning in 1996. In 1998, Portugal began importing liquified natural gas (LNG) from Nigeria, which is regasified at Spain's Huelva LNG terminal. In October 2003, Portugal's new LNG import terminal (Sines) received its first shipment, diversifying and increasing its natural gas supply. In order to further diversify the country's energy mix, as well as to fulfill EU requirements, the Portuguese government has been promoting the development of renewable energy resources.
Despite decades of exploration activity, Portugal has yet to discover a commercially viable oil deposit. In 2002, the Portuguese government offered 14 deep-water-offshore blocks for exploration and production contracts. After the licensing round expired on December 2, 2002, only Repsol-YPF, in partnership with RWE of Germany, made bids for Blocks 13 and 14.
Companies have not been successful in discovering natural gas in commercially viable volumes in Portugal. The Sines terminal allows Portugal to diversify its natural gas supply, which previously was dependent on Spain's natural gas network to process and transport natural gas from Algeria and Nigeria. The Sines terminal, which is operated by Galp Atlântico, has an annual import capacity of 195 Bcf (regasified).
Gás de Portugal (GdP) is the dominant player in Portugal's natural gas sector, controlling gas imports, distribution, transmission and sales of natural gas. GdP has a stake in all of the country's six regional natural gas distributors (Lisboagás, Portgás, Lusitâniagás, Setgás, Tagusgás, and Beiragás). Due to the infancy of the country's natural gas market, Portugal has been granted a temporary exemption from fulfilling many of the requirements outlined in the EU Directive 98/30/EC on liberalizing the natural gas market.
The largest oil company in Portugal is Petrogal, a wholly-owned subsidiary of Galp Energia, which is owned by the Portuguese government and a collection of international oil and gas operators. Petrogal controls the domestic midstream and downstream oil sectors in Portugal, and maintains modest production activities in Angola and Brazil. Galp holds shares from Petrogal (100%), Gás de Portugal (GdP, gas distribution) and Transgás (100%) (natural gas import, transmission and sales company). Galp is owned by: the state (29.26%), Eni (33.34%), EdP (14.27%), REN (18.4%), Setgas (0.04%), Portgas (0.04%) and Iberdrola (4%).
Portugal has two refineries, located in the coastal cities of Sines and Porto. Petróleos de Potugal (Petrogal) operates the two refineries, which have a combined capacity of 304,174 bbl/d.
