Oil from tar sands is the latest battlefield between the environmentalists and fossil fuel interests.
Canada has the second largest reserves of oil in the world – estimated at165 billion barrels, behind Saudi Arabia – if it can exploit this relatively novel form of resource.
Tar sands (or oil sands) are bitumen-saturated sand and clay deposits that require more energy to extract than conventional oil.
The resource, which can be exploited with modern technology, is Canada’s big new bonanza.
The European Commission cites studies showing that, according to well-to-wheel calculations, tar sands oil generates 23 per cent more greenhouse gases than ordinary crude.
The Commission therefore wants to put oil from tar sands into its own polluting category.
The Canadian federal and Albertan regional governments dread such a categorisation.
They have made common cause with oil firms active in Alberta’s tar sands fields and have sympathy from some European governments – notably in Britain and the Netherlands, with their concerns for Shell – because the European policy approach may set a precedent in other parts of the world.
It will also make it harder for oil firms to comply with the EU’s Fuel Quality Directive, which is designed to enforce the supply of considerably less polluting fossil fuels to the market.
Canadian lobbying has been intense. At times in the past three years, government ministers have been visiting Brussels to lobby MEPs almost every month, and Canadian embassy officers around Europe are well briefed on the merits of tar sands oil.
It is a big issue for Canadian interests, even if as yet European imports of tar sands oil are minuscule.
It is a public relations battle which the Canadian government fears could impact on exports to the far more important US market.
Canada knows that tar sands oil appeals to America’s need for ‘energy security’.
It is a source of transport fuel that does not derive from the Middle East and is in no danger of being “used to fund terrorist movements”.
The tar sands lobby cites consultancy studies to claim that the greenhouse gas emissions quoted by the European Commission are slightly exaggerated – that the difference is more like 10-15 per cent than 23 per cent – which puts it on a par with some normal crudes from Nigeria and Venezuela.
They say these figures will get steadily better as extraction methods improve.
They also assert that if the Europeans don’t buy Canadian oil other countries will, so global emissions will not be much reduced.
The Canadians can claim some success from their efforts.
The final decision to categorise tar sands oil separately has been put off by the EU several times, though a final decision is expected this autumn.
Several MEPs on the right and on the industry committee are said to be persuaded by the Canadian arguments.
For their part, Green lobbyists in Brussels point out that Canadian greens and indigenous groups say their voices are never heard when MEPs are taken on PR trips to tar sand areas like Fort McMurray in Alberta.
The bitter discussions taking place between the EU and Canada may be a bit technical for the general public, but they illustrate the increasing desperation to exploit the world’s dwindling fossil fuel resources.
And this situation will be with us for a time yet, as the transport sector’s need for oil will continue for the foreseeable future.