* Canada sees "good chance" EU will back away from plan
* Canada worried about negative image of tar sands
* Says senseless to single out tar sands crude
By David Ljunggren
OTTAWA, Oct 18 The European Union could yet
reject a proposal to classify crude from Alberta's tar sands as
dirty oil, the Canadian energy minister Joe Oliver said on
Tuesday, a move which would potentially boost Canada's hopes of
becoming a key global energy supplier.
As part of a plan to cut greenhouse gas emissions, the EU's
executive commission wants to single out crude from the
enormous northern Alberta oil sands as being particularly
energy-intensive to produce.
Canada's Conservative government fears this could limit the
future market for tar sands crude and blur the message that
Canada is, in Oliver's words, a reliable energy superpower
which will develop the sands in a socially responsible way.
Speaking to Reuters in an interview, Oliver insisted that a
move to single out oil sands crude made no sense from a
scientific point of view and would concern European firms who
have invested heavily in the industry.
"We definitely don't think we've lost ... there's a good
chance because we believe science is on our side," he said
shortly before flying to Europe to press home the Canadian
government's message. "This is far from over."
The EU proposal to place tar sands oil on its fuel quality
directive must be approved by separate votes of European
officials and by lawmakers before it comes into force.
"We're not exporting oil sands oil to Europe but we don't
want the potential stigmatization and we're quite concerned
about that issue," said Oliver.
The tar sands contain more than 170 billion barrels of
recoverable oil and are the world's third-largest crude reserve
behind Saudi Arabia and Venezuela.
Green groups have long portrayed the sands as an
environmental disaster because of the energy needed to extract
the crude, and Canada is battling vocal opposition to a
proposed pipeline taking bitumen from the tar sands to
refineries on the U.S. Gulf Coast.
"Our government is now seen as a kind of anti-environmental
bully that does whatever the tar sands companies ask it to do,"
said Keith Stewart of Greenpeace Canada.
Oliver said the carbon intensity of crude from the oil
sands was similar to oil from major suppliers to the EU such as
Mexico, Venezuela, Nigeria and Russia, and sometimes lower.
Diplomats say the European Union is split over the fuel
quality directive, with Britain and the Netherlands - home to
firms which are investing in the sands - privately helping to
push the Canadian point of view.
The British "have been very very helpful and we're pleased
about that," Oliver said. "Many European companies are heavily
invested in the oil sands and they also would be concerned."
Oliver suggested earlier this month that Ottawa could take
the EU to the World Trade Organization if the Europeans adopted
the fuel quality directive.
"The government hasn't taken a position on what its
alternatives are but we definitely will not sit passively by if
something negative were to happen," he said on Tuesday when
asked about taking the case to the WTO.
Big companies active in the oil sands include Suncor Energy
Inc , Total SA , Royal Dutch Shell Plc
and Canadian Natural Resources Ltd . They and other
have invested tens of billions of dollars in projects in the