Galp recovers from agreement that tanked shares
The shares of Portugal’s oil, gas and energy company Galp have finally rallied after being tanked partly as a result of 4Q 2025 earnings below expectations due to planned refinery maintenance and mostly over its oil exploration partnership in Namibia with France’s TotalEnergies.
After weeks of falls because of a partnership with France’s TotalEnergy and synergies with Moeve, shares have now bounced back to €17.56 per share, a level not seen since December.
The falls had been related to an agreement made with TotalEnergies over offshore oil fields in Namibia.
The Galp Namibia accord (announced in December 2025) is a strategic partnership and asset-swap agreement between Galp and TotalEnergies regarding oil exploration in Namibia’s prolific Orange Basin.
Under this agreement, Galp accelerated the development of its “Mopane” discovery by bringing in TotalEnergies as a partner and operator, while securing a stake in TotalEnergies’ adjacent “Venus” oil discovery.
Galp had agreed to sell a 40% stake in the oil filed PEL 83 (which contains the Mopane complex) to TotalEnergies. In exchange, Galp acquired a 10% interest in PEL 56 (Venus discovery) and a 9.4% interest in PEL 91.
TotalEnergies agreed to fund 50% of Galp’s future capital expenditures for the exploration, appraisal, and development of the Mopane discovery. This funding will be repaid by Galp using 50% of its future cash flows from the project.
The PEL 83 consortium is set to be held by TotalEnergies (40%, Operator), Galp (40%), NAMCOR (10%), and Custos (10%).
Galp had previously identified the Mopane field as a major discovery, potentially containing over 10 billion barrels of oil equivalent.
The deal allows Galp to share the high costs and risks of deepwater development with a major partner.
The partnership aims to create a major production hub in Namibia – the Orange Basin Hub – combining the oil resources of Mopane and Venus.
Shares had plummeted other their lowest levels since Covid-19 from December after the partnership had been announced. Investors held considerable doubts over Galp’s strategy of partnerships with TotalEnergies.
Galp posted preliminary fourth-quarter EBITDA of approximately €610 million and operating cash flow of €443 million, according to a trading statement released at the start of February.
The figures came in below J.P. Morgan’s pre-statement forecasts of €656 million for EBITDA, with the shortfall primarily driven by the Industrial & Midstream division.
“Planned Sines refinery downtime was already guided/anticipated but larger in magnitude,” J.P. Morgan analysts said in a note.
They characterised the weakness as “4Q specific and transitory rather than structural in nature.”
Despite the quarterly miss, Galp comfortably met its full-year targets, delivering EBITDA of €3Bn and operating cash flow of €2.2Bn for 2025.
The company is expected to maintain its 2026 share buyback program at €250 million, flat year-over-year, according to J.P. Morgan.
Sources: J.P Morgan, investing.com and ECO Online
Image: Galp
