Bacalao al Pil-Pil is a classic Basque fare. After you prepare the garnish and simmer the cod for several minutes, you make the sauce by engaging the cod in a 'dance' with the olive oil to create an emulsion that looks very much like a mayonnaise. The dance is not without challenge, but even the patient novice cook can produce an excellent result.
To ensure success, bear in mind the following rules:
Use only olive oil; other fats will not result in the superior emulsion this dish demands.
Use the best salt cod you can find or salt it yourself.
Use a cazuela or similar earthenware cooking vessel that can be used on the stove top.
And finally, when you are ready to place the fish in the cazuela to begin the sauce, make sure the salt cod, olive oil, and cazuela are all lukewarm.
Drain the salt cod and pat dry with paper towels. Cut into 3-inch squares, leaving the skin intact. When cooking later in olive oil, the skin will release the needed gelatin to help emulsify the sauce.
In a 12-inch cazuela, heat the olive oil over medium heat. When the oil is hot, add the garlic and the chile and fry, stirring occasionally, for 2 to 3 minutes, or until the garlic starts to turn golden. Using a slotted spoon, transfer the garlic and chile to a small bowl and reserve for garnish. Reserve the oil in the cazuela.
Decrease the heat to medium-low and add the cod pieces to the oil. Simmer for about 10 minutes, being careful not to let the oil become too hot. The oil should just barely sizzle around the edges of the fish pieces. Using a slotted spoon, transfer the cod to a plate and then pour the olive oil into a wide heatproof bowl to cool. When the cod is cool enough to handle, remove any errant bones, leaving the pieces as intact as possible.
Return the cod pieces, skin side up and in a single layer, to the cazuela. At this point, make sure that the cazuela, the cod, and the reserved olive oil are all lukewarm.
Place the cazuela over medium heat and begin by spooning 2 or 3 tablespoons of the olive oil over the cod. It its here that the dance begins: using both hands, rotate the cazuela in circular motions over the burner. Continue the motion until the first drops of oil start to emulsify. You will know that the emulsion is beginning when the oil drops turn pale and cling to one another. Eventually the whole sauce will turn pale white.
Continue to rotate the cazuela, interrupting only to add the olive oil gradually, spoonful by spoonful, until all the oil is incorporated into the emulsion. Depending on the quality of the cod and the gelatin content of its skin, it will take anywhere from 15 to 30 minutes to make the sauce.
Divide the cod evenly among individual plates and spoon the sauce over the top. Garnish with the reserved garlic and chile. Serve hot or warm.