Canada’s oil sands have long had a problem: They not only emit greenhouse gases when they’re burned as fuel, but they also require resource-intensive scouring when they’re produced.
But are they dirty? Not according to the European Union, which Canada hopes will become a major customer of its abundant oil sands. On Oct. 7, the European Commission decided to scrap plans to designate them as dirtier than other forms of crude, opening the door for Canada to export oil to the energy-hungry bloc.
The original EU plan had been to penalize the fuel, which generates about 25 percent more carbon than ordinary crude. The EC decision removes the oil’s condition during production from the equation.
With that obstacle out of the way, thanks to intense lobbying by Ottawa, oil suppliers will be able to ship, and European refineries will be able to receive, huge amounts of Canadian oil.
Canada has only recently begun to ship oil to Europe, but the future looks bright for both seller and customer, in terms of revenues and reliable energy. In fact, that was a major argument in Canada’s lobbying effort: With Western relations with Russia worsening, the EU must look elsewhere for reliable sources of oil and gas.
Reuters quotes anonymous sources at the EU as saying the need for a trade deal with Canada had been a factor given the situation with Moscow.
Meanwhile, Canada’s been preparing to export its oil in huge volumes. First, it’s working on the Energy East Pipeline running from its western province of Alberta, rich in oil sands, to the country’s Atlantic oil ports.
It’s also been planning the Keystone XL pipeline stretching from its province of Alberta, rich in oil sands, through the United States and ending at Gulf of Mexico oil ports. The project has stalled, however, because of opposition and legal challenges from private citizens in the U.S.
Harvesting oil sands is harder than simply drilling for crude. The dense sands must be dug out or blasted with steam before their oil content can be pumped to the surface. As a result, the process requires far more water and energy, and emits more greenhouse gases than conventional crude oil extraction.
Meanwhile, the EC’s decision isn’t absolutely final. It includes a proposal to assess the levels of pollution of any given fuel from its development to its end-use. If any fuel, including Canadian oil sands, is found to be incompatible with the EU’s climate goals, then the EC will propose unspecified remedial action.
As EU Climate Commissioner Connie Hedegaard said in a statement, “The Commission is today giving this another push, to try and ensure that in the future, there will be a methodology and thus an incentive to choose less-polluting fuels over more polluting ones like, for example, oil sands.”
By Andy Tully of Oilprice.com
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