Portuguese oil company Galp is investing in advanced biofuels and green hydrogen as part of its decarbonization efforts. The company has opened two public consultations for the GalpH2Park (green hydrogen) and HVO (biofuels) projects in Sines, with a total investment of 486 million euros. The goal of these projects is to achieve a 50% reduction in carbon dioxide emissions from the Sines refinery by 2030.
The green hydrogen project will involve the installation of an electrolysis capacity of 100 megawatts (MW) in the Sines refinery to produce fuels with the hydrogen of renewable origin. Galp aims to replace part of the hydrogen that it already uses in the refinery with hydrogen produced through renewable sources. The company has also partnered with EDP and other companies to install close to 100 MW of electrolyzers on the grounds of the already decommissioned Sines coal-fired power plant through the GreenH2Atlantic project.
In addition to GalpH2Park, the company is exploring up to 700 MW of electrolysis in Sines to make its production and consumption of hydrogen in the refining process completely green. During the construction of GalpH2Park, the oil company expects the work to reach a peak of 296 workers, of which 225 are direct. Construction is expected to take 25 months, and the production of green hydrogen will create 52 direct and more than 200 indirect jobs during the exploration phase.
The HVO project aims to produce hydrotreated vegetable oil as biofuels, which will have an initial investment of 269 million euros. Galp expects construction to start in the second half of this year, assuming the company decides to move forward with the investment and obtains the environmental license. During the construction phase, the project will have a peak of 1150 workers, and during operation, the biofuels unit will have 76 new direct jobs and 150 to 200 indirect ones.
The Portuguese Environment Agency has opened public consultations for both projects until June 1. Galp has not yet made a final decision on the investments and is expected to do so by the end of the year.
Although Galp’s decarbonization efforts are laudable, the company faces potential challenges with the scalability and economic viability of the projects. The use of renewable sources to produce green hydrogen is still expensive, and the lack of infrastructure and low demand for biofuels may limit the profitability of the HVO project. However, Galp’s investment in advanced biofuels and green hydrogen marks a step towards a more sustainable energy future and sets an example for other oil companies to follow.