WRITTEN QUESTION E-3592/00

by Gordon Adam (PSE) to the Commission

(22 November 2000)

Subject: Hydrocarbons research

In the light of current widespread public concern within the European Union regarding the availability and price of petroleum products:

(a) Has the Commission reassessed the relative priorities given to hydrocarbon research?

(b) How does the Commission intend to utilise the Fifth Framework Programme to enable increased production of hydrocarbons within the European Union by promoting research into improved techniques to maximise extraction of hydrocarbon reserves?

(c) Given the need to increase the efficiency of hydrocarbons utilisation in order to reduce emissions and dependence on oil imports into the European Union what new steps is the Commission taking to encourage research in this area?

Answer given by Mr Busquin on behalf of the Commission

(19 January 2001)

During the first two years of the Fifth framework programme (FP5) the annual Community funding for the exploration and production of hydrocarbons amounted to 25 million. The annual Research and technological development (RTD) funding from Member States for this sector is estimated to be around 150 million. Community funding therefore forms approximately 15 % of the overall Community public funding in this area. United States public funding for this sector is USD 200 million per year.

(a) and (b) The average yearly discovery of new oil deposits (at present oil price) during the last 10 years, is around 10-15 % of oil discoveries during the sixties. As the lifetime of oil wells is around 40 years, oil production may be expected to decrease by 2010-2015. Although Europe has a small proportion of total world oil reserves (some 2 % for the European economic area (EEA)), these can play an important strategic role in the Community's security of supply. To keep up or increase oil production, new oil deposits, where oil extraction is more expensive, could be brought into production. This will require huge investments for oil exploration and production in deep seas and difficult environments, to produce oil, which will be more expensive. As compared to these investments, the Community funding of 50 million, for the first two years of FP5, can only have a very limited impact. Priority has therefore been given to RTD aiming at cost reduction of other clean non-nuclear energy (NNE) technologies, with zero or low carbon-dioxide (CO2) emissions such as renewable energies and fuel cells, where financial resources are often scarce. This is reflected by the midterm revision of the work programme for the Energy part of the Thematic Programme on Energy, Environment and Sustainable Development (recently approved in October 2000). While, exploration and extraction of hydrocarbons is not amongst the priority areas (Target Actions) for 2001 and 2002 for which 60 % of the budget has been allocated, RTD on this topic is however covered in the general part of the programme for which the remaining 40 % funding is available.

(c) The issues related to the dependence on oil imports and reduction of CO2 and pollutant emissions are discussed in the Commission's green paper Towards a European Strategy for the security of energy supply(1). The green paper identifies structural weaknesses in Europe's energy supply, including dependence on external supplies, in particular of hydrocarbons, and growing demand. These weaknesses are creating risks to Europe's energy supply which could increase over the coming decades. One of the major weaknesses concerns the transport sector. The transport sector in the Community is almost 100 % dependent on oil, consumes almost 70 % of all oil in the Community, (of which 75 % is imported from third countries) and is the fastest growing consumer of energy. Further, 90 % of the rise in CO2 emissions in the Community from 1990-2010 will be attributable to transport. The green paper sees the need for a European strategy in order to minimize the risks to energy supply, within the framework of enlargement, sustainable development and market liberalisation. One of the focuses for action is the transport sector. As well as demand-side policies, the green paper calls for efforts to develop alternative fuels to hydrocarbons, including hydrogen and biofuels. In this context, the above-mentioned revised work programme includes a Target Action on Clean Transport Fuels which aims at a rapid development of clean biofuels (which have zero net CO2 emissions) and clean fuels derived

from natural gas (which have lower CO2 and pollutant emissions than oil). This will particularly help to reduce the dependence on oil in the transport sector. This Target Action also includes combustion research aiming at a minimization of pollutant emissions and an optimisation of the efficiency.

(1) COM(2000) 769 final.