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BUENOS AIRES, Mar 19 (IPS) – For about three years now, Argentines have been listening to virtually each month that oil manufacturing is breaking new information. Wanting forward, the nation is projected to turn into a serious international provider of what stays probably the most sought-after power supply.
These developments, introduced as hopeful information for an economic system that has been in deep disaster for at the least 12 years – with a decline in per capita GDP, worsening revenue distribution, and rising poverty – nonetheless increase many questions.
Critics query the distribution of financial advantages, the inhabitants’s entry to power, the enlargement’s environmental and social affect, and the digital abandonment of the nation’s local weather objectives and commitments.
The so-called Neuquén Basin, within the nation’s southwest, is the epicenter of an oil exercise enlargement that sectors of academia and environmental and social organizations describe as overly aggressive.
“Within the final 10 years, exploration started in agricultural areas. Since 2012, 3,300 oil wells have been drilled, 440 of which had been accomplished in 2024. Over 500 wells are deliberate for 2025,” researcher Agustín González informed IPS.
González, an agronomist and professor on the Nationwide College of Comahue, which has campuses in Neuquén and Río Negro – two provinces within the Patagonian basin the place the Vaca Muerta geological formation is situated – highlighted the affect of this enlargement.
This subject, which sparked the hopes of Argentine politicians and businessmen in 2011 when the U.S. Power Administration categorized it as one of many world’s largest reserves of shale fuel and oil, is lastly starting to yield outcomes, generally on the expense of different sectors.
Shale hydrocarbons are extracted utilizing a method referred to as hydraulic fracturing, or fracking, and González warns that its widespread use is inflicting vital impacts in a historically agricultural area identified for its high-quality fruit manufacturing.
Affect on Native Communities
“Fracking is extraordinarily violent. It makes use of 30,000 liters of water per properly, combined with over 60 chemical compounds and high-powered pumps to fracture the rock. It has nothing to do with typical oil exercise,” González defined.
“Fracking impacts all close by land makes use of. When it’s achieved close to a river, a farm, or a populated space, it places them in danger,” added González, who’s a part of a joint analysis group on the environmental and social affect of Vaca Muerta, involving the College of Comahue and the Stockholm Atmosphere Institute.
“The event of fracking have to be balanced with the safety of pure assets, meals manufacturing, and social fairness, establishing a sturdy regulatory framework to forestall irreversible injury to ecosystems, agricultural areas, and native communities,” warns a research revealed final December by this group of researchers.
Nevertheless, this doesn’t appear to be the very best time to debate these points in Argentina, the place far-right President Javier Milei has downgraded the Ministry of Atmosphere to a minor division underneath the Secretariat of Tourism and has utterly rejected not solely the local weather agenda but in addition the strengthening of the state’s position as a regulator of productive and industrial actions.
“The federal government has defunded the Renewable Power Improvement Fund (Foder) and outright closed the distributed power fund,” Matías Cena Trebucq, an economist on the non-governmental Atmosphere and Pure Assets Basis (Farn), informed IPS.
The skilled added that “whereas earlier governments had a debated deal with pure fuel as a transition gasoline, the Milei administration is now totally dedicated to fossil fuels and has eradicated any reference to a path towards clear power.”
In 2015, the Argentine Congress handed a legislation setting a purpose for 20% of the nation’s electrical energy consumption to return from renewable sources by December 2025. In 2024, the sector grew attributable to older tasks coming on-line, reaching 15% of era, however it’s unlikely to proceed rising with out state help.
Constructive Steadiness
Because of current tendencies, Argentina achieved a optimistic power commerce steadiness in 2024 for the primary time in 13 years, with exports exceeding imports by US$5.668 billion.
Exports of fuels and power grew by 22.3% final 12 months in comparison with the earlier 12 months, reaching $9.677 billion, accounting for 12.1% of the nation’s complete exports, in keeping with official information.
The principle rationalization for these figures lies within the enlargement of fracking in Vaca Muerta, which contributed 54.9% of all oil manufacturing and 50.1% of fuel nationwide. In December alone, Vaca Muerta produced 446,900 barrels of crude oil (159 liters every), 27% greater than in the identical month of 2023.
Standard oil and fuel manufacturing, then again, continues to say no because of the depletion of the San Jorge Gulf Basin within the Patagonian province of Chubut, which was historically the nation’s important oil-producing area.
Complete manufacturing in 2024 was 256,268,454 barrels of oil, 11% greater than in 2023. This marks 4 consecutive years of development, pushed solely by unconventional oil from Vaca Muerta.
Because of the potential of this geological formation, numerous research circulating within the sector recommend that Argentina is on observe to succeed in US$30 billion in annual oil exports by 2030 and place itself as a worldwide provider.
“The Argentine oil business has superior during the last 15 years, whatever the authorities in energy,” Gerardo Rabinovich, vice chairman of the non-governmental Argentine Institute of Power (IAE) Basic Mosconi, informed IPS.
He added that “right now, the advantages are being reaped, the sector will proceed to develop, and it’s potential that the purpose of US$30 billion in exports will probably be reached earlier than 2030.”
“In 2022, we had an power commerce deficit of US$4 billion, and in 2024, we achieved a surplus of over US$5 billion. That is essential for Argentina,” he added.
Nevertheless, the flip aspect of this actuality is that, because of the brutal adjustment of public accounts by the Milei authorities, home demand for gasoline and diesel fell by 6.5% and 5%, respectively, in comparison with 2024, in keeping with an IAE report, stated Rabinovich.
“The Milei authorities has proposed utterly liberalizing oil exercise, displacing the state, and aligning native costs with international ones,” Fernando Cabrera Christiansen, a researcher on the Southern Oil Observatory, informed IPS.
Cabrera, talking from Neuquén, the place he lives, famous that the expansion of Argentina’s oil manufacturing has not led to better well-being for a predominantly impoverished inhabitants, nor has it made power cheaper domestically.
He emphasised that, whereas over US$40 billion in investments have flowed into Neuquén within the final decade, in keeping with information from the provincial Undersecretariat of Power – an quantity unmatched by every other area – social indicators stay as alarming as these in the remainder of the nation.
“The province makes use of oil royalties to pay public salaries and different present bills. It’s not sufficient to construct infrastructure or present social advantages. And poverty ranges in Neuquén are much like the nationwide common,” he concluded.
© Inter Press Service (2025) — All Rights Reserved. Original source: Inter Press Service
