Energy & Environment: "Exploring Energy and the Environment in Argentina"

     By:  Cullen Aulwurm, Katie LoNigro, & Bill O’Donnell

Intro
Argentina is a unique country, partly due to their resources and geographic location. It allows for a wide variety of energy sources to be utilized, including some that are renewable. Coming from the United States, it will be interesting to explore the differences and similarities between the two countries as far as energy practices go. Each country uses different policies and has different regulations in regards to energy and sustainability, and these differences shape how the energy sector functions as a whole.

While in Argentina, we will also be looking into the Environmental issues that are so prominent. One large problem is deforestation. The dense forests are being cut down as a result of the growing population and need for expanded agricultural areas. The extraction of shale oil is also very harmful to the environment, and requires a lot of land. Lastly, because of this, tension has grown between natives who live in these areas, and people who live in the cities.

Oil & Energy:

The energy industry is confusing no matter what country you’re in and Argentina is no exception.  We’re going to make it easy for you:

What is the energy industry?
In short, this phrase encompasses all of the companies involved in the production and sale of energy. Okay so what’s energy?  This is anything from the gas that powers your car, to electricity in your home, to nuclear power, and even hydroelectric or other renewable energies.
At this point, you’re probably wondering how this has anything to do with Argentina.   All of the areas highlighted in red show recoverable basins of shale oil and gas.  Quick debrief: shale oil (better known as tight oil) is a light grade oil that often requires advanced technologies to access (think fracking and horizontal drilling).  Shale gas just refers to the natural gas that is trapped within shale formations and is accessed in the same way that tight oil is.
Argentina is well known for the Vaca Muerta (yes that means dead cow), a vast geologic formation that contains billions of barrels of reserves.  Vaca Muerta is actually 2nd in the world in recoverable shale.

Why is this even cool?
If you do a quick comparison with the United States, Argentina actually has a really interesting situation.  First off, their main energy company YPF (Yacimientos Petrolíferos Fiscales—try saying that five times fast) was the first oil company ever established as a state enterprise.  Later, a Spanish oil company, Repsol, acquired the majority of YPF.  What was hopefully going to be a beautiful relationship ended badly, Argentine officials claimed Repsol purposely underinvested in YPF in order to expand to other parts of the world and of course Repsol argued otherwise.  Now, YPF is back as a state run company.  Second, Argentina relies heavily on gas as their main source of energy while the United States is still highly dependent on coal.  For some more quick comparisons, check on the following graphics.

United States
Argentina
Consumption
imports>exports
imports>exports
Available Resources
Marcellus Shale
4th in recoverable shale
Vaca Muerta
2nd in recoverable shale
Top Oil Producers
1.   Exxon Mobil
2.   Chevron
1.   YPF
2.   PAE
Now that you know a little bit more about the energy industry in Argentina, it’s time to take a look at the effects it poses on the people and the environment.
Environmental Issues:
These days it is hard to find a country that isn’t struggling with environmental issues, so Argentina isn’t too different from the United States in that respect. What makes Argentina especially unique are the rich ecosystems, the indigenous people, and how they are being threatened by rapid expansion and the country’s reliance on oil and gas.
In 1914, Argentina was home to 105 million hectares of natural forests; almost one hundred years later, there is an estimated 33 million hectares remaining. Argentina’s deforestation is a result of agribusiness (commercial agriculture using advanced technologies), especially the meat and soy industries, which relies on large amounts of land to raise and slaughter cattle. This large scale deforestation has resulted in the destruction of the natural habitats of many species who live in these areas and has led to more carbon dioxide.  Remember your middle school science, a decrease in plant life (flora) leads to an increase in carbon dioxide in the atmosphere.
Agribusiness isn’t the only culprit in the destruction of Argentina’s natural lands.  Huge demands for energy are resulting in fracking and drilling in the Patagonian Grasslands (another unique ecosystem in Argentina). Some of the latest studies show that up to 70% of land in the Patagonia area, most of which is in Argentina, suffers from some degree of erosion or desertification due primarily to inadequate or unsustainable grazing practices, increasing subdivision of the land, development of energy resources, and a lack of standardized regulations for managing freshwater resources.
Not only has Argentina’s energy expansion lead to a negative impact on the environment, it also has adverse effects on the Indigenous people that live there. Sustainability is not only about making sure we effectively use resources, it is also about preserving the rights of others and making sure that everyone can live together as one. This statement from an Amnesty International Article explains how the indigenous people are being negatively affected, “Over the last few years state and private interests, especially those of the agribusiness and extractive industries, have built up enormous barriers between Argentina’s native population and their rights to their traditional lands.” Similar to how the United States has invaded the lands of the native tribes that originally resided in North America, Argentina is struggling with the same issue. It will be important for the Argentine government to find a good balance of expansion and preservation, so that they can lead a more sustainable society going forward. Now if all of this seems like a daunting task, which it is, don’t
like there isn’t anything that can be done. Check out the video below to see how many Argentines are working in their own local communities to help alleviate these issues.

We look forward to exploring all aspects of the energy industry while in Argentina, from the benefits of the vast shale reserves to the environmental issues currently surrounding the country.  We hope to speak to different industry experts to help shed more light on this topic.
Sources
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