State seen granting €63M in tax breaks to €657M Repsol project

Portugal’s government is on Thursday to consider granting tax incentives of up to €63 million to a €657 million project planned by Spain’s diversified oil company Repsol in the industrial complex at Sines that is described as the country’s “largest industrial investment” in a decade.

“The Council of Ministers will have the opportunity to appreciate today a set of investments, among them, probably, the largest industrial investment of the last ten years,” the secretary of state for internationalisation, Eurico Brilhante Dias, told Lusa. “It is an investment by Repsol that will not only contribute to the decarbonisation of the Portuguese economy, but will also focus on the objectives we have of increasing exports and reducing imports.”

The project, which is deemed to be Potential National Interest (PIN) and hence eligible for large-scale state support, is for the expansion of Repsol’s operations at Sines, with the construction – scheduled to start this year and run until 2025 – of two new factories for high-added-value polymeric materials that are 100% recyclable for the automotive, pharmaceutical and food industries, among others.

According to the secretary of state, “it is estimated that, at cruising speed, the direct impact of the project on the trade balance of goods could be close to €800 million.”

The project, he said, will also “extend the longevity” of Repsol’s “very important production facility” at Sines, by allowing it to be positioned “as a modern infrastructure in a sector that has to contribute to decarbonisation, since its base is a fossil fuel, oil.”

“It will, to a large extent, start a process that will allow Portugal, from the point of view of this industry, to have an infrastructure that has clearly made a very significant leap in the European Union as a whole,” he added.

“More than the amount of investment – which is very major and, in the industrial area, probably the largest in the last ten years – [the project] will allow the re-launch of a very important unit and a major Portuguese exporter,” he stressed, explaining that “Repsol is one of the largest Portuguese exporters in the area of goods, which is probably in the top 10 of Portuguese exporters.”

Brilhante Dias also pointed to the project’s expected creation of 75 new permanent jobs, plus an average of 550 jobs during the construction phase, which could at times rise to over 1,000.

“It is a great day for Portugal, it is a great day for Sines and we also believe that it is a great day for Repsol,” he concluded.