BUENOS AIRES, Mar 19 (IPS) – For about three years now, Argentines have been listening to nearly each month that oil manufacturing is breaking new data. Trying forward, the nation is projected to turn into a significant international provider of what stays essentially the most sought-after vitality supply.
These developments, offered 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 elevate many questions.
Critics query the distribution of financial advantages, the inhabitants’s entry to vitality, the growth’s environmental and social impression, and the digital abandonment of the nation’s local weather targets and commitments.
The so-called Neuquén Basin, within the nation’s southwest, is the epicenter of an oil exercise growth 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 impression of this growth.
This discipline, which sparked the hopes of Argentine politicians and businessmen in 2011 when the U.S. Vitality Administration categorised it as one of many world’s largest reserves of shale gasoline and oil, is lastly starting to yield outcomes, generally on the expense of different sectors.
Shale hydrocarbons are extracted utilizing a way known as hydraulic fracturing, or fracking, and González warns that its widespread use is inflicting vital impacts in a historically agricultural area recognized for its high-quality fruit manufacturing.
Impression 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 finished 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 impression 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 harm to ecosystems, agricultural areas, and native communities,” warns a examine 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 beneath the Secretariat of Tourism and has utterly rejected not solely the local weather agenda but in addition the strengthening of the state’s function as a regulator of productive and industrial actions.
“The federal government has defunded the Renewable Vitality Growth Fund (Foder) and outright closed the distributed vitality fund,” Matías Cena Trebucq, an economist on the non-governmental Atmosphere and Pure Sources Basis (Farn), informed IPS.
The skilled added that “whereas earlier governments had a debated give attention to pure gasoline as a transition gas, the Milei administration is now totally dedicated to fossil fuels and has eradicated any reference to a path towards clear vitality.”
In 2015, the Argentine Congress handed a regulation setting a objective for 20% of the nation’s electrical energy consumption to return from renewable sources by December 2025. In 2024, the sector grew resulting from older initiatives coming on-line, reaching 15% of era, however it’s unlikely to proceed rising with out state help.
Constructive Steadiness
Due to latest tendencies, Argentina achieved a constructive vitality commerce steadiness in 2024 for the primary time in 13 years, with exports exceeding imports by US$5.668 billion.
Exports of fuels and vitality grew by 22.3% final yr in comparison with the earlier yr, reaching $9.677 billion, accounting for 12.1% of the nation’s complete exports, in line with official knowledge.
The principle clarification for these figures lies within the growth of fracking in Vaca Muerta, which contributed 54.9% of all oil manufacturing and 50.1% of gasoline 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.
Typical oil and gasoline manufacturing, then again, continues to say no as a result of 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.
As a result of potential of this geological formation, varied research circulating within the sector counsel that Argentina is on observe to achieve US$30 billion in annual oil exports by 2030 and place itself as a worldwide provider.
“The Argentine oil trade has superior during the last 15 years, whatever the authorities in energy,” Gerardo Rabinovich, vice chairman of the non-governmental Argentine Institute of Vitality (IAE) Common Mosconi, informed IPS.
He added that “as we speak, the advantages are being reaped, the sector will proceed to develop, and it’s doable that the objective of US$30 billion in exports shall be reached earlier than 2030.”
“In 2022, we had an vitality 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, as a result of 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 line 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 larger well-being for a predominantly impoverished inhabitants, nor has it made vitality cheaper regionally.
He emphasised that, whereas over US$40 billion in investments have flowed into Neuquén within the final decade, in line with knowledge from the provincial Undersecretariat of Vitality – 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 isn’t sufficient to construct infrastructure or present social advantages. And poverty ranges in Neuquén are just like the nationwide common,” he concluded.
© Inter Press Service (2025) — All Rights Reserved. Authentic supply: Inter Press Service
