Supply & Trading

We diversify our crude sourcing by using suppliers from several countries. This policy mitigates potential impacts from possible events, particularly, geopolitical conflicts.

Galp’s supply and trading activities of oil products also account for the sale of the refining system’s production, both to Galp’s commercial activities as well as to other operators in Iberia and in the exports market.

In 2019, sales to non-Galp activities accounted for 7.5 mton, of which 3.3 mton were allocated to the supply of other operators.

Benefiting from the excellent location of its refineries, Galp also exports a portion of its production. In 2019, 4.2 mton of oil products were exported and North America, particularly the East Coast, remained an important contributor to the export of heavy gasoline components, used for blending purposes. During 2019, the main products destinations was for the U.S.A., Spain and The Netherlands.

During 2019, Galp and Sonatrach entered into a new agreement that will allow Galp to purchase up to 2.5 bcm of NG per year for a period of 10 years. Early in 2020, Galp signed a sale and purchase agreement (SPA) with Nigeria LNG Limited to ensure the sourcing of 1 mtpa of LNG for 10 years.

Transportation

Galp imports natural gas destined for the Iberian market through:

• Al Andalus pipeline (Spain) - Connects Tarifa to Cordoba;
• Extremadura pipeline (Spain) - Córdoba to Campo Maior;
• Sines - Sines LNG regasification terminal.

The international gas pipeline linking Portugal and Spain transports contracted natural gas from Sonatrach, in Algeria, which enters Spain through the Europe Maghreb Pipeline (EMPL) pipeline.

The Sines LNG regasification terminal receives LNG vessels purchased mainly from NLNG in Nigeria.

Trading

Galp carries on its NG/LNG trading activity on the international market and continues to strengthen its position in the network trading activity in European natural gas hubs, namely in Spain, France and in the Netherlands.

Following the end of the last structured LNG contract in the third quarter of 2018, LNG trading became more opportunistic. Nevertheless, network trading should continue to gain relevance.

Trading volumes (mm³):

• 2018 - 2,875 mm³
• 2019 - 2,937 mm³ 

Power

Galp aims to maintain a competitive electricity generation and has been strengthening its commercial portfolio to provide energy to its customers.

Galp is currently present in the market through the Iberian Electricity Market (MIBEL), both in the spot market (OMEL) and in the futures market (OMIP). This activity is mainly aimed at the acquisition of electricity in the market, which is sold through the commercial activity.

The Company is also looking to diversify its electricity sources, either by entering into renewable power purchase agreements with third parties and/or through the construction of its own power generation renewable portfolio.

Learn more about Renewables & New Businesses here.

In 2019, the Company established two long-term Power Purchase Agreements (PPAs) for a total of c.650 GWh per year for a 12-year period, which underpin 400 MW solar power projects.