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  PlanetArk 10 May 07
Refining Riddle: Cleaner Fuels Make More CO2
Story by Iain Pocock

LONDON - Making cleaner fuels could cause more harmful emissions -- an oil refining paradox.

Plans to tighten European fuel quality rules to cut air pollution will need a huge increase in energy-intensive equipment at refineries to clean the fuels. As well as existing measures to slash sulphur content in diesel fuel, heating oil and bunker fuel for ships over the coming two years, the European Commission earlier this year proposed making gas oil for farming and industrial vehicles almost sulphur free by the end of 2009.

Refiners would also be required to cut greenhouse gas emissions gradually from 2010.

The moves come against a backdrop of a European refining industry struggling to keep up with rising European demand for diesel fuel and reliant on imports to meet the shortfall.

"On the one hand the legislators say you must produce more and cleaner diesel, and on the hand, they say you can't produce more carbon dioxide," said Peter Tjan, secretary general of the European Petroleum Industry Association, which represents Europe's downstream oil industry.

"Well, unfortunately you cannot have both - that's impossible."

The European Union in March agreed to a target of reducing EU greenhouse gas emissions by 20 percent by 2020.

Carbon dioxide, a by-product of combustion, is the main greenhouse gas blamed for trapping heat in the atmosphere and causing global warming. Sulphur dioxide is blamed for acid rain and health problems such as lung disease.

The production of increasingly sulphur-free fuels requires refiners either to process less sulphurous but more costly crude oil, or instal expensive desulphurization units such as hydrotreaters and hydrocrackers.

Many European refiners have opted for the latter. French refiner Total SA late last year started up a 50,000 barrels per day hydrocracker at its Gonfreville plant in northern France, while Finnish refiner Neste is about to start up a diesel-making unit at its Porvoo refinery.

"To remove sulphur requires heat, pressure and hydrogen," said David Martin, refining analyst at the International Energy Agency. "None of those are without a cost in terms of CO2."

While the EU's proposed changes would result in lower sulphur levels in gas oil, they could have far-reaching consequences in terms of reduced product supply and higher greenhouse gas emissions, the International Energy Agency says.

"It's great for the world to be moving towards sulphur-free fuels, but there are cost implications here not only in terms of CO2 emissions, but in terms of the way it affects refiners," the IEA's Martin said.

SHIPPING

Besides the EC's latest proposals, some industry groups have called for the world's merchant fleet to run on cleaner-burning distillate fuels instead of high sulphur marine fuels, whose sulphur and nitrogen dioxide emissions are expected to surpass land-based emissions in the EU by 2020.

There are some 50,000 merchant ships trading in international waters, carrying more than 90 percent of the world's traded goods by volume, consuming over 200 million tonnes of marine fuels a year.

But a move for ships to run on cleaner fuels, on top of the push for cleaner land transport fuels, would likewise add to refiners' needs to build more energy-intensive units to produce the fuels, raising CO2 emissions in the process.

Seaborne trade is increasing steadily and, like aviation, CO2 emissions from shipping, though still small, are not covered by the Kyoto protocol on global warming, which sets limits for greenhouse gases.

"This would require massive investments worldwide," said Europia's Tjan. "Inevitabely the hydrocrackers and the hydroconversion units are more energy-intensive than a (gasoline-making) cat cracker, so by moving in that direction, we're also producing more CO2."

(Additional reporting by Stefano Ambrogi)

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