Galp Energia and PDVSA Ink 5 Cooperation Agreements

Galp Energia and PDVSA have signed in Caracas five cooperation agreements related with energy projects for oil, natural gas and renewable areas. These agreements follow the Memorandum of Understanding signed last October in Lisbon by the two companies for the development of joint projects in the energy sector and for forms of cooperation between the two companies including the possibility to develop exploration, production and marketing of oil and gas.

These agreements emphasize Galp Energia's willingness to identify and develop partnerships with PDVSA and economical relations with Venezuela, positioning this country as a relevant player in Galp Energia's internationalization plan in the exploration and production area, jointly with the operations under way in Angola and Brazil.

Agreement for acquisition of crude oil

Galp Energia and PDVSA agreed on the acquisition by Galp Energia of an annual volume of crude oil between two and four million barrels of oil, at market prices, potentially renewed by annual periods.

Following the guidelines defined at the Energetic and Economic Complementary Agreement between Portugal and Venezuela, the agreement for acquisition of crude oil strengthens the bilateral relations between the two countries, creating conditions for other Portuguese companies to develop businesses with Venezuela.

Agreements for the development of two LNG projects

These two agreements foresee the establishment of two companies, one for each project, where Galp Energia will hold a position of 15% in each of them. Each project includes the development of a pipeline from the respective gas producing fields (Plataforma Deltana and Mariscal Sucre), which will transport the natural gas to the liquefaction trains. These facilities will be installed at Gran Mariscal de Ayacucho Industrial Complex, in Guiria, state of Sucre. Each train will have a total processing capacity of 6.5 billion cubic meters of natural gas per year that after liquefaction will be sold in the international market.

These agreements also establish that Galp Energia will acquire a total volume of two billion cubic meters per year of LNG produced by those companies. The final investment decision will be taken before the end of 2009, being the first volumes of LNG expected before 2014.

Agreement for the joint study of Block Boyaca 6 at Orinoco Oil Belt

This agreement establishes the cooperation between the two companies for the joint evaluation of the project for development, production, upgrading and commercialization in the international market of the oil coming from Block Boyaca 6, at Orinoco Belt in Venezuela.

After the completion of the certification process under way of Block Boyaca 6 reserves and the conclusion of the studies mentioned above, planned for 2009, the necessary process of approval will follow in order to establish a company for the execution and operation of the project.

Memorandum of Understanding for the development of wind farms

The Memorandum of Understanding defines the cooperation of Galp Energia in the study, project and installation of four wind farms with a total capacity of 72 Megawatts, at Guajira, Chacopata and Nueva Esparta states. Galp Energia will also provide training and technical assistance to the future operators of the wind farms, and will secure the transfer of the technology associated to the project.