Shale of the century
If risible stories like the uproar over the authenticity of a letter signed by Pope Francis con only be here today and gone tomorrow, the immediate future meanwhile might be about what consequences the sluggish economy will have on next year’s presidential elections. But when all is said and done there is a growing certainty that Argentina’s future is locked in the rocks of the shale fuel fields of Vaca Muerta, Neuquén. Those fields, controlled by the state-run energy company YPF, have now attracted enough attention in the world for United States Deputy Energy Secretary Daniel Poneman to extensively tour Argentina last week. Poneman’s stay included a meeting with President Cristina Fernández de Kirchner and agreements were signed to give an institutional framework to the exchange of technology for further fuel exploration.
Poneman knows Argentina in depth to the point he has written a book on the nascent democracy here in the years of the 1983-1989 Raúl Alfonsín presidency. Predictably the visiting US official is now chirping a tune that will grow louder as the exploration in the fields of Neuquén progresses: Argentina’s shale fuel reserves are “world class” and the future can only be bright. Need more evidence? YPF last week reported a shale fuel finding in Chubut province. To quote Poneman, it’s very difficult to imagine how the situation of your children and grandchildren here in Argentina will not be far better than what it is for you today. And to put it in the straightforward speak of the oilmen of the US energy giant Chevron, Argentina has won the “geological lottery” with its 1,000 foot thick shale oil and gas field in Patagonia.
That’s essentially good news in the long run, but it would be naive to take what the executives and officials are saying literally and to think that the oil boom will not bring with it its own set of political, institutional, financial and environmental issues. A number of key economic and organized labour policies will need to be discussed. Dealing with these potential problems and conflicts will not be the responsibility of the fuel companies and the foreign governments who are all of a sudden so pragmatically eager to do business here. Civil society needs to start paying attention — and that means you.