Galp Energia: OW a catalyst-rich 2H

Research evidence excerpt

Galp Energia: OW a catalyst-rich 2H

in Brazil is 40kb/d

net Galp (35% of 2025 production) and volumes are ramping ahead of plan owing Quarterly Forecasts (FYE Dec)

to superior flow rates. Namibia returns to prominence led by a midyear FID on Adj. EPS (€)

Venus (Galp 10%) and a resumption of drilling on Mopane from early 4Q (led by 2025A 2026E 2027E

partner TotalEnergies; Galp 40%); we value Galp Namibia at €1.7bn. Downstream Q1 0.26 0.38A

- completion of the Moeve merger could come around 2Q results. Disposals - An Q2 0.50 0.59

Q3 0.55 0.45

FID by Exxon on Rovuma gas in Moz is reportedly slated later this year. This will Q4 0.25 0.39

trigger a $400m contingent payment to Galp (equivalent to 25% of end-1Q ND). FY 1.56 1.81 1.78

2Q; Operationally robust, JPMe EBITDA €1.2bn. 2Q price markers are above Style Exposure

current spot levels (eg: avg Brent oil $107). The quarter should see sound

production (only modestly lower than a high-end 1Q), good refinery throughput/

margins and a (partial) reversal of an adverse 1Q price lag effect within midstream.

Pre- the 13 July trading statement we forecast EBITDA €1.2bn. We model net debt

trending broadly sideways depending on price sensitive working cap effects

including a renewable acquisition and interim div payment, before dropping

further in 2H. On the FY, we model potential for O&G production guidance to be

revised to the top/above a current 125-130kboe/d range (1He high 120s with

Bacalhau ramping to YE) and FY EBITDA >€4bn including aforementioned

higher volumes, an oil MTM to $85 and near consensus $12/bbl refining.

Valuation. We value Galp on NAV to best capture its long term growth potential.

This gives a headline equity value of around €24/sh at LT $65 Brent, incorporating

an estimated Namibia EV of €1.7bn (€2.3/sh).