notWHAT IT'S

ABOUT

The Fuel Quality Direc-tive (FQD) sets a 6% reduction target in the carbon intensity from transport fuels to be met

by 2020. This is a technology-neutral target that leaves to the industry a range of options to meet it in the most cost-effective way. One such way is by providing alternative low carbon fuels such as sustainable biofu-els or clean electricity.

?WHAT IS I T ALL ABOUTFUEL QUALITY DIRECTIVE

and theTAR SANDS

The Commission pro-posal to implement the FQD assigns carbon intensity to all fossil fuel feedstocks, namely: tar sands, coal-to-liquid, oil shale, gas-to-liquid and conventional oil. It does NOT discriminate between sources on the

basis of geographical locations; it’s all about the carbon intensity of each fuel source. Oil shale gets a higher carbon intensity value than tar sands under this proposal. The specific ‘default value’ for tar sands is NOT just in place for Canadian oil, but for all fuels that are produced from tar sands anywhere in the world, including Venezuela, Russia, Madagascar and the US.

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WHATABOUTit is

NIGERIAVENEZUELA

RUSSIA

Source: Modified from Oil Shales of the World: Their Origin, Occurrence and Exploitation by Paul L. Russell and UNITAR Heavy Oil & Oil Sands database.

OIL SHALE LESS CERTAIN

OIL SHALE MORE CERTAIN

EXTRA HEAVY OIL AND TAR SANDS

USA

CANADA

MADAGASCAR

?TAR SANDS - WHAT'S ALL THE FUSS ABOUTDepending on the density of the crudes, we can differentiate between light crude oil, heavy crude oil and extra heavy crude oil (e.g. tar sands). The heavier the crude is, the more energy is required to extract, transport and refine it, ultimately increasing the emissions released during the entire fuel lifecycle. Tar sands oil is produced from a different feedstock than conventional crude, which requires much more energy during the extraction and processing phases than conventional crude oil, increasing greenhouse gas (GHG) emissions.

A RECENT REVIEW OF 13 SCIENTIFIC STUDIES HAS SHOWN THAT

Tar sands fuels have GHG emissions of up to higher than other conventional crudes.The official Commission study assumes that on average tar sands are

worse than conventional crude oil.

49%

23%

THE SPECTRUM OF FOSSIL FUELS, THEIR CARBON CONTENT AND VALUE

VALU

E: $

PER

MIL

LION

BTU

S

CARBON CONTENT MORE

MORE

LESS

NATURAL GAS

NATURAL GAS LIQUIDS

HEAVY OIL

TAR SANDS

COAL

CONVENTIONAL CRUDE OIL

BUT STUDIES SHOW THAT

THESE SAVINGS ARE ADDITIONAL TO THE 50-60MT CO2 ANNUAL SAVINGS TO BE ACHIEVED BY FQD'S 6% CARBON REDUCTION TARGET.

THE FQD AND GLOBAL GHG REDUCTIONSThe latest study on the subject has shown that differentiated values for different unconventional feedstocks for petrol and diesel can save up to 19 Megatonnes of GHG emissions per year by shifting investment in tar sands projects to lower-carbon oil sources.

TO REMOVING

OF GHGEMISSIONS

EQUIVALENTFROM EUROPE'S ROADS EVERY YEAR

CARS MILLION19

7 TONNESMILLION

Canada is arguing that other types of oil imported to Europe from countries like Venezuela, Nigeria or Russia have the same or an even worst carbon footprint than tar sands oil, because they have a high level of flaring.

Average emissions from tar sands projects are higher than the average emissions from projects that flare.Even countries with high levels of flaring, especially Nigeria, on average still have less GHG emissions than the average of tar sands.

DIFFERENCE IN WELL TO WHEEL GREENHOUSE GAS INTENSITY COMPARED TO EU AVERAGE

40%

30%

20%

10%

0%

-10%

-20% NORWAYUNITEDKINGDOM

IRAQ DENMARK

UNSPECIFIED EU

ALGERIALIBYA

IRAN

SAUDIARABIA

KUWAIT VENEZUELA

RUSSIAN FEDERATION

MEXICOKAZAKHSTAN

TAR SANDS LOWEST EMITTING PROJECT

TAR SANDS MOST LIKELY AVERAGE PROJECT

TAR SANDS HIGHEST EMITTING PROJECT

CAMEROONEGYPT

NIGERIA

AZERBAIJAN

ANGOLA

SYRIA

DEFAULT VALUESWILL SAVE UP TO

ADMINISTRATIVE COST - MAX. 1.6 EUROCENTS X OIL BARREL

CANADIAN TAR SANDS PROJECTS COMPARED TO IEA CLIMATE SCENARIOS

MIL

LION

S OF

TAR

SAND

S BA

RREL

S A

DAY

WHAT NEEDS TO HAPPEN

FOR THIS REASON T&E RECOMMENDS THAT THE EU

HOW THE INDUSTRY WILL BE AFFECTED

SUPPLY BEING PROPOSED SO FAR

SUPPLY ALREADY APPROVED

IEA HIGH DEMAND ON PATH TO 6C° “CATASTROPHE” IEA LOW DEMAND ON PATH TO 2C° “SAFE CLIMATE LIMIT”

1

2

3

4

5

6

7

8

9

PRODUCING

IN CONSTRUCTION

APPROVED

BEING REVIEWED

ANNOUNCED

According to the usually conser-vative International Energy Agency (IEA), two-thirds of all proven fossil fuel reserves will have to stay in the ground if the world is to achieve the goal of limiting global warming to two degrees Celsius.

The administrative cost of implementing the Commission’s FQD proposal would be minimal. It would add less than half a eurocent for a 50-litre fill-up or a maximum of 1.6 eurocents per barrel of oil, but it would make the overall compliance with the target cheaper. The industry has claimed a figure of $1 a barrel, but has not published any research to back it up. The ‘default values’ will not have an impact on European refineries simply because EU refineries are not equipped to process unconventional crudes, such as the ones from tar sands. Only Spain has recently upgraded refineries to be able to accept some Venezuelan tar sands crudes. Most refineries will not have to make additional investments and they will continue relying on conventional crudes that they can process.

Leaves carbon intensity values for all fossil fuel feedstocks in the implementing rules for the FQD.Ensures that fuel suppliers are obliged to report these carbon intensity values.

THIS LEAVES US WITH ONLY ONE CONCLUSION:

We just can't afford to let tar sands (and other unconventional fuels) grow exponentially.

EUROENTC

EUROENTC

For references and more information please visit: http://transenv.eu/FQDtarsandsThis publication is part-financed by the European Union through operating grants to T&E. Sole responsibility lies with the authors and the European Commission is not responsible for any use that may be made of the information contained herein.

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