EU lawmakers fail to approve tar sands oil veto

* Committee of politicians vetoed the plan previously

* Canada welcomes decision

By Barbara Lewis

BRUSSELS, Dec 17 (Reuters) - An attempt by some Europeanpoliticians to veto the import of tar sands oil failed onWednesday after a European Parliament vote, giving a boost toCanada but dismaying green campaigners.

After years of lobbying from Canada, the European Commissionpublished a new plan in October on reporting the greenhouse gasintensity of transport fuels. It abandoned the idea of labellingtar sands oil as highly polluting.

Earlier this month, a parliamentary committee vetoed theplan in an attempt to get tar sands oil branded "dirty", on thegrounds it produces more carbon than other oil because of theenergy needed to extract it from bituminous deposits.

The veto was put to a vote in a plenary session of theEuropean Parliament on Wednesday. While 337 lawmakers supportedthe veto, that fell short of the 376 votes needed to prevent theEuropean Commission's plan going through.

The October plan removed a requirement to insist on separatecarbon values for different types of oil. This would have madeit more difficult for European refiners to use Canada's oilsands or oil shale from EU member state Estonia and meet EUregulations on reducing carbon emissions.

Canada says its oil can diversify EU supplies, especially asthe Union is seeking to reduce dependence on its top energysupplier Russia. Estonia has said its economy could suffer ifunconventional oil had to be labelled more polluting.

Oil prices at about $60 a barrel, near their lowestin five and a half years, add to the challenge of developingsources such as tar sands, which the industry refers to as oilsands, because it costs more to extract.

The industry says Canada's resources, being developed byfirms such as ExxonMobil, BP and Royal DutchShell, were unfairly singled out in the original EUplan.

Welcoming Wednesday's vote, Greg Rickford, Canada's ministerof natural resources, said Canada was "a secure, reliable andresponsible source of energy".

Campaign group Transport & Environment said the EU planincluded a "a basic tracking system of the fuels used intransport", saying it was better than nothing but too weak.

"We know the origin of the coffee we drink and the chocolatewe eat. But we are in the dark when it comes to the hundreds ofbillions worth of petrol and diesel we put in our cars,"programme manager Nusa Urbancic said. (Additional reporting by David Ljunggren in Ottawa; editing byDavid Clarke)