I think it says either MONAI or MORAI. The latter option is close to Morais or Moraes, a common Portuguese family name - perhaps the equivalent of the Spanish family name Morales.
The portrait reminded me of Lord Byron, which makes no sense, but may give you an idea of the period and the wealth of the man portrayed, judging from the clothes.
The most romantic speculation on this coin involves the Napoleonic prisoners of wars, locked up in several places, notably Dover castle. They made all kinds of object to earn some money, from model ships to decorated tobacco pipes. Scratching a portrait of an elegant Englishman wouldn't be beneath them and the portrait looks artfully done. Of course, Portugal was a British ally, but there must have been Portuguese choosing the wrong side.
Peter
