Costa resigned after being informed about the investigations around the members of his staff and the executives of the projects concerned. He claimed his conscience was clear but "the dignity of the role of Prime Minister is not compatible with any suspicion regarding his integrity, his good conduct and, even less, with suspicion of the commission of any criminal act". President Marcelo Rebelo de Sousa accepted his resignation and stated that the possible departure of the Prime Minister would lead to the dissolution of the parliament and call for new elections as of March 2024. 

An ongoing corruption probe 

The investigation is part of an ongoing corruption probe originally launched by the Central Investigation Prosecution Authority in response to an anonymous complaint in 2019. The purpose of the inquiry is to find out whether certain Portuguese companies received differential treatment regarding their participation in a green-hydrogen project in Sines, a small town south of Lisbon. 

The green-hydrogen project

Portugal stands as a prominent European economy in terms of its significant utilization of renewable energy in final energy consumption. The nation's strategic location positions it as a key hub for green hydrogen within Europe. The National Hydrogen Strategy (EN-H2) was released in August 2020 by the Portuguese Ministry for Environment and Climate Action, with alignment to the 2050 Carbon Neutral Roadmap and the 2030 National Energy and Climate Plan. 

Investigation of SINES data center

In January 2023 the Attorney General’s Office confirmed leading an investigation related to firms dealing with not only green hydrogen but lithium and another initiative, namely the SINES project. The SINES project pictures a major Hyperscaler data center ecosystem being powered by 100% renewable energy right on land adjacent to a former coal-fired power plant. It is described by the conducting company (Start Campus) as “the perfect gateway to Europe and the World”. The project, which is supposed to be fully finished by 2030, is a response to two global trends: digital transformation, and sustainability. The data center serves as an opportunity for attracting investment and providing new jobs. 

A key to energy independence: lithium

The investigation was related to lithium mining in the North of Portugal as well. Lithium is an essential resource for electric car production, thus it is a highly important initiative not only for Portugal’s long-term economic plans but also for the European Union’s electric vehicle industry. The lithium mining in the region of Montealegre and Boticas was part of the EU’s aspiration to secure critical raw materials and reduce dependence on Chinese, African, and South American mines fundamental for the green transition. The idea of the mines faced strong opposition, mainly of those living in the area of the mining fields. They were concerned about the environmental damage the project causes and the low quality of the raw material extracted. 

The persecution

The Authorities have already searched more than 40 premises during the investigation, including the official residence of the Prime Minister. 

As a result of the ongoing inquiry, several officials and executives have been accused. Vítor Escária, the Prime Minister’s chief of staff, and Nuno Mascarenhas, the mayor of Sines, were detained for interrogation. Besides them, arrest warrants had been issued for two executives, Afonso Salema and Rui Neves at Start Campus. Portugal’s infrastructure minister, Joao Galamba, and the president of the Portuguese Agency for Protection of the Environment had also been indicted as part of the investigation.

António Costa said he will remain in position until the naming of his successor, but won’t run again for the post of Prime Minister. He sees his departure as “the end of this chapter”. The leader of the Socialist Party (Partido Socialista) was first elected as Prime Minister in 2015 when the party formed a minority government backed by a coalition of far-left parties. The projects concerned are examples of an important focal point of the government’s program, the promotion of sustainability and green transition. 

The Portuguese economy has shown great progress under the rule of Costa’s government, which has gained significant public support in the past years and eventually won the elections in 2022 with an absolute majority. The current case is not the first one related to corruption issues. During his third term as Prime Minister, several officials had to resign due to scandals about similar concerns, related to an irregular severance payment to a former board member of state-owned TAP Airline. 

Rui Rocha, the leader of the Liberal Initiative party said: “There were no longer conditions for António Costa to continue in office…I don’t believe there is any other solution than the dissolution of the assembly of the republic and elections so that the Portuguese can have their say.”

However, it has turned out, that the Public Prosecutor's Office reportedly confused the name of Prime Minister António Costa with that of Economy Minister António Costa Silva in the transcript of the 'Operation Influencer' wiretaps. The suspicions against Costa were due to this mistake, so in the end, it seems Costa may resigned for nothing.

Future prospects

According to Politico, António Costa was the socialists’ pick to succeed Charles Michel as European Council president from November 2024. He already had extensive experience in the Council of the European Union and the European Parliament. This plan seemed to fall apart with the news about the investigation, but since Costa was found innocent, there still is a chance for him to continue his political career as the president of the Council.