WATCHING THE WORLD 'GREEN' PLANNERS SHORT ON METHOD

With David Knott from London Western European refiners have shed more than worth of their refining capacity in recent years vet still face chronic overcapacity. Thirty-four refineries are being built in the Far East and Australasia, with 30 more in the Middle East, Africa, and Latin America. Those new plants will add almost 5 million b/d in capacity, more than one third of the total capacity of western Europe.

Nov. 1, 1993

3 min read

Western European refiners have shed more than worth of their refining capacity in recent years vet still face chronic overcapacity.

Thirty-four refineries are being built in the Far East and Australasia, with 30 more in the Middle East, Africa, and Latin America.

Those new plants will add almost 5 million b/d in capacity, more than one third of the total capacity of western Europe.

Investment in refining outside Europe is worthwhile, says David Varney, managing director, Shell U.K. Ltd. Downstream Oil. But European refiners face spending to meet European Community proposals.

Varney said, "I think the present approach to environmental improvement will be disastrous for this industry, for European economies, and Ultimately for the environmental ambitions which prompt the legislators-ambitions which most of us share."

Although we cannot delay environmental improvements, Varney said, he should not rush into unthinking actions that may have perverse, unintended consequences.

UNCOORDINATED MEASURES

"EC environmental policy appears to be a series of uncoordinated measures, proposed without proper cost/benefit analysis or even consideration of the environmental tradeoffs and pursued without pausing to learn the lessons of one before rushing to the next," Varney said.

"This, for a vastly complex subject where proper measurement is only beginning, where scientific understanding is uncertain, and where the costs could be economically crippling."

Anyone who listens to fuel additives manufacturer Associated Octel Co. Ltd., Milton Keynes, U.K., could become convinced that all refiners' spending on converting to unleaded gasoline production has been in vain.

HEALTH DANGERS

Octel told the U.K. government the tax difference that makes unleaded gasoline cheaper at the pump than leaded should be eliminated on health and environmental grounds.

The company warned of health dangers in adding benzene and other substances said to cause cancer to unleaded gasoline in place of lead, in order to boost octane ratings.

Also, Octel said, unleaded gasoline is less fuel-efficient than leaded gasoline. Increasing use of unleaded gasoline is "... increasing emissions of the greenhouse gas carbon dioxide thus contravening the principles behind the proposed carbon tax."

That suggests the industry has more work to do in producing a truly "green" gasoline. Varney pins his hopes on "...harnessing the power of competitive markets to develop new, innovative technologies."

In the meantime, Varney recommends governments take their own medicine. Environmental policy makers should adopt the systematic approaches they prescribe for refiners under recently drafted environmental management standards.