The European Commission has proposed forcing oil companies to cut greenhouse gas emissions from drilling, refining, transporting and burning fuel in new rules aimed at fighting global warming. The plan, which seeks to cut emissions from oil's "life cycle" from the ground to a car's exhaust by 10 percent from 2011-2020, drew criticism from a European refining industry body, which said some of the targets were unachievable.

Confirming a Reuters report, the European Union executive said on Wednesday the move would reduce emissions by 500 million tonnes of carbon dioxide (CO2) by 2020. It also proposed stricter environmental standards for diesel and gas oil, or heating oil, sold in the 27-nation bloc with an eye to boosting the use of biofuels and reducing air pollution. The proposals resemble a similar measure in California, which is seeking to cut carbon in vehicle fuels by at least 10 percent by 2020. They come just weeks after the Commission challenged the world to reduce its emissions of greenhouse gases by 30 percent by 2020 compared to 1990 levels.

"We need the European Union to practice what it preaches," Environment Commissioner Stavros Dimas told lawmakers after the proposal was adopted by his fellow commissioners. "Now is the time to move from words to action." The new rules also come as the EU grapples with a proposal to reduce CO2 emissions from cars, which has drawn opposition from Germany and the auto industry, a key sector in Europe.

Dimas favours binding legislation to force car manufacturers to lower CO2 emissions of new cars to an industry average of 120 grams per km in 2012. Industry Commissioner Guenter Verheugen supports an approach that targets fuel standards and driver behaviour in addition to car makers' products. Dimas stressed the fuel rules were independent of the cars proposal, which is slated to be unveiled next week.

Criticism from all sides
The new fuel quality rules drew criticism from the European Petroleum Industry Association (Europia), which represents refiners such as Total, ExxonMobil, BP and Shell. "It's unachievable," Europia Secretary General Peter Tjan told Reuters, adding the European biofuels market was not sufficient to meet the demand that such a rule would require. "These sort of targets can only be achieved with massive imports," he said, adding that the import process alone would release greenhouse gases.

He said the move would also make fuel more expensive for the consumer and criticised the Commission for giving mixed signals about the targets it is seeking. Environmentalists said focusing on fuel was not enough. "By placing a disproportionate emphasis on fuel quality, the Commission is diverting attention from the real problem -- the cars that use the fuel," said Claude Turmes, a member of the Greens party in the European Parliament, in a statement.

Under the new rules, sulphur content in diesel would be limited to 10 parts per million from 2009, to reduce emissions of dust particles and fight air pollution. Poly aromatic hydrocarbons -- which the Commission says can cause cancer -- would be cut by one-third. The proposal also foresees a new blend of petrol with "higher permitted oxygenate content (including up to 10 percent ethanol)" to enable more use of biofuels.

The new rules update several existing directives and are part of the bloc's efforts to meet commitments under the Kyoto Protocol to reduce greenhouse gas emissions. They must be approved by EU governments and the European Parliament, a process which usually takes about two years. Finish refiner Neste Oil said the Commission's proposals appeared to be on the right track. "The starting point for our business operations is without doubt aligned towards such goals (to reduce greenhouse gases)," Chief Financial Officer Petri Pentti told Reuters.

Austria's OMV said it was already delivering on some of the objectives. (additional reporting by Sami Torma in Helsinki and Karin Strohecker in Vienna)
(Por Jeff Mason, Planet Ark, 01/02/2007)