Portuguese power firm EDP is willing to compromise in order to overcome European Commission objections to a proposed merger with Gas de Portugal (GdP), the president of the utility said in an interview published Saturday.

State-controlled oil company Galp Energia is proposing to sell 51 percent of GdP to former state monopoly EDP and the other 49 percent to Italian energy group ENI.

But last month the European Commission, the executive arm of the European Union, formally objected to the proposed merger, expressing concern to Lisbon that the deal could make Portugal's main electricity and gas providers overwhelmingly dominant.

EDP president Joao Talone told weekly newspaper Expresso the company was willing to temporarily give up its veto right in Portuguese gas company Turbogas, a smaller rival of GdP, in order to remove these concerns.

The utility currently has a 20 percent stake in Turbogas which gives it a veto right over key decisions.

While Talone said EDP would be willing to give up the veto rights, he ruled out selling the firm's stake in Turbogas.

Talone added EDP was also willing to sell its terminal in Sines south of Lisbon in order to win approval for the merger.

"We are very close to reaching a consensus," he said.

Portugal and Spain agreed at a summit earlier this year to start running a long-delayed unified power market before June 2005, known as Mibel, and Lisbon is eager to get approval for the merger before that then.

Talone echoed the view of the Portuguese government which argues that the EDP-GdP deal should be considered in the context of the proposed Mibel single Iberian energy market instead of just in the context of the Portuguese market.