EU dismisses Canada’s threat to appeal dirty oil designation – by Steven Chase, Paul Waldie and Shawn McCarthy (Globe and Mail – May 10, 2013)

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA and LONDON and OTTAWA — The EU believes its controversial proposal to label oil-sands crude as dirty would withstand a test at the World Trade Organization after Canada threatened to file a complaint over the measure.

The disagreement over the EU designation – which would effectively impose an import tax on Canadian bitumen – overshadowed talk Thursday by Brussels and Ottawa of a final push to sign a trade pact before the summer.

The Harper government is now fighting for international acceptance of emissions-heavy oil-sands petroleum on two fronts.

Prime Minister Stephen Harper announced Thursday he will go to New York next week as part of his push to win a green light from the U.S. for the Keystone XL pipeline project that would transport bitumen to Gulf Coast refineries but has been heavily opposed by environmental activists.

He’ll participate in a question-and-answer session at an event organized by the Council on Foreign Relations. Mr. Harper said he looks forward to discussing Keystone, among other issues, as a U.S. debate rages over whether to give the energy-intensive oil-sands development a thumbs-down.

Meanwhile, Thursday, the European Union rebuffed a Canadian cabinet minister’s efforts this week to defend the oil sands by raising the prospect of a trade fight with Brussels.

Canada’s Natural Resources Minister, Joe Oliver, said Wednesday Ottawa would consider launching a complaint with the world’s trade referee if the EU proceeds with a fuel-quality directive that singles out crude from Canada’s oil sands as the most harmful to the planet’s climate.

Matthias Brinkmann, European Union ambassador to Canada, told reporters in Ottawa Thursday that he believes the World Trade Organization would find no fault with the fuel-quality directive if it were ever tested there.

“We are confident our measure will be non-discriminatory and science-based and will stand the test in the WTO,” Mr. Brinkmann said.

He said Mr. Oliver is getting ahead of himself because the fuel directive is still in draft form.

“Mr. Oliver, he threatens to appeal at the WTO against something which doesn’t exist yet,” the EU ambassador said.

He rejected the notion it would harm EU-Canada trade talks because, he said, the directive has yet to come into effect.

Asked whether he considered it pushy for Mr. Oliver to travel to Europe and make a threat before the directive is settled – behaviour that might rile Canada if roles were reversed – the EU ambassador simply replied: “You said it.”

Mr. Oliver, who was in London speaking to a business audience Thursday, sent out mixed messages as he tried to address fallout from his remarks.

At first, the Natural Resources Minister appeared to back away from the prospect of taking Europe to the WTO. But hours later he telephoned to clarify his remarks and insist a World Trade Organization challenge is still on the table.

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