Wednesday, February 15th 2012 - 05:32 UTC

Argentina on the verge of “unprecedented energy shortage”, say former ministers

Argentina’s Energy Institute, IAE, warned that the country faces an “unprecedented energy crisis” with strong drops in hydrocarbons reserves, production and the loss of self sufficiency.

Since Nestor Kirchner took office in 2003 oil and gas reserves have been eroding

IAE made up of former Energy ministers said in a release that the current energy situation in Argentina is no surprise: it was expected since there are “no long term policies for the industry, a total lack of planned strategy and an inadequate implementation of serious policies”.

According to IAE since Nestor Kirchner took office in Argentina in 2003 and until 2010, oil reserves dropped 6% and natural gas 41%. In the same span of time oil production fell 18% and gas, 7%.

“We have become net importers of natural gas, fuel oil and gas oil with demand and tendencies increasing which presents an unprecedented and unsustainable fiscal effort plus an accumulation of social demands still unsatisfied”.

IAE proposes an integral auditing of all exploitation concessions and hydrocarbons exploration licenses, debating a new Hydrocarbons bill and creating a new national oil corporation to manage the State’s interests.

The document follows a recent attack from President Cristina Fernandez on oil companies, particularly YPF, Argentina’s largest, for the alleged lack of investments to help a greater production of hydrocarbons.


51 comments Feed

Note: Comments do not reflect MercoPress’ opinions. They are the personal view of our users. We wish to keep this as open and unregulated as possible. However, rude or foul language, discriminative comments (based on ethnicity, religion, gender, nationality, sexual orientation or the sort), spamming or any other offensive or inappropriate behaviour will not be tolerated. Please report any inadequate posts to the editor. Comments must be in English. Thank you.

1 Mrlayback (#) Feb 15th, 2012 - 06:52 am Report abuse
Yep and this headline dont help you love:

Argentine labour accuses CFK of “escalating repression” and endangering human rights policy

She`s really got her work cutout to convince the people that the falkland Island is the answer, its like an alcoholic trying to convince a therophist that the answer lies right at the bottom of the bottle.
2 BenC30 (#) Feb 15th, 2012 - 08:15 am Report abuse
“She's really got her work cutout to convince the people that the falkland Island is the answer, its like an alcoholic trying to convince a therophist that the answer lies right at the bottom of the bottle”

Couldn't have put it better myself!
3 ElaineB (#) Feb 15th, 2012 - 11:24 am Report abuse
“no long term policies for the COUNTRY, a total lack of planned strategy and an inadequate implementation of serious policies”.

Sums up the way CFKC manages the country.

I was near Cordoba last winter and there was a very serious shortage of energy for heating. I am guessing it will only get worse this year.
4 GreekYoghurt (#) Feb 15th, 2012 - 11:59 am Report abuse
Minister: “We have no energy and because of hyperinflation we cannot afford to eat. On a good note, KFC has bought some new Louboutin shoes in a fetching red colour.”
5 zulu99 (#) Feb 15th, 2012 - 01:50 pm Report abuse
Will these guys be threatened with some legalities from the government for saying these things, not unlike economists who present data that doesn't jive with what the government wants “to tell” the people?

Also, the statement “no long term policies for the country, a total lack of planned strategy....” shows her lack of basic managerial skills. Anybody who has managed even a small team can do this. But she's setting Argentina on a new course of prosperity right? Uh huh...
6 GreekYoghurt (#) Feb 15th, 2012 - 02:03 pm Report abuse
@5 Generally in Argentina the Winston Smiths of their world end up in Room-101 for not supporting the Argsoc party line, courtesy of the Ministry of Truth (ArgMinitru).
7 axel arg (#) Feb 15th, 2012 - 03:37 pm Report abuse
I know that it's a placer for some of you to read this kind of negative news about argentina, however, you have no idea about who are all those so called former ministers of energy. Some of those hipocrites who criticise the policies of the c. f. k's government, were the same who during menem's presidence applied neoliberal measures and privated the energetic sistem, beside, the soposed lack of a serious long term policies for the country, is a partial truth, because it's a fact that oil and gas reserves fell, but in the last years there was exploration by some private corporations, and important reserves of oil and gas were found, beside, enarsa, our statal enterpise of energy, found a huge reserve of oil, in the orinoco basin in venezuela, an explores the south of argentina also, anyway it's not enough, per haps the best that the government can do, is to renationalize ypf, that's an enterprise that never should have been sold, i dont know any other nation that privates it's oil and gas enterprises.
8 GreekYoghurt (#) Feb 15th, 2012 - 03:49 pm Report abuse
@7 Yes, those hippocrites who dare to criticise the Juche policies of our Great Leader KFC and the Eternal Leader Nestor will be made to suffer. Only by renationalisation all the companies and creating a vast command economy can we lead our country away from the capitalist running dogs of USA, the paper-tigers of UK and bring our harmonious country to the glorious future.
9 yankeeboy (#) Feb 15th, 2012 - 04:39 pm Report abuse
7. No other country “privatizes o/g industry” how about almost every democratic country in the world? Who do you think owns BP, Exxon, Andarko etc? Governments? Gosh your dumb!
BTW the HUGE o/g discovered recently needs to be extracted by fracking, Arg has no knowledge/experience of how to frack. It is extremely dangerous and tricky. Good luck getting it out of the ground without some sort of help from a multi-national oil company not the idiots running Enarsa.
From the last count ARG is still 3 LNG shipments short of the projected usage this winter, they better get with it or it is going to be a cold winter.
10 jerry (#) Feb 15th, 2012 - 05:00 pm Report abuse
9 yankeeboy (#) - And, on top of this is the fact that fracking is only good for gas. No country in the world has ever been able to come up with a method of getting the oil out of oil shale at a profit!
11 yankeeboy (#) Feb 15th, 2012 - 05:58 pm Report abuse
10. The reason there is no oil exploration is because if there is any found the company is forced to sell it to the State for $42/barrel. Who is going to do that when they can go to a legitimate country and sell it for $100+? Um, as you can see NO ONE. Ks are very short sighted to the ruin of the nation. Chavez light.
12 Conqueror (#) Feb 15th, 2012 - 06:34 pm Report abuse
Advice for BP. No more shipments to argieland.
13 Think (#) Feb 15th, 2012 - 08:16 pm Report abuse
(9) Yankeeboy Aka: Fredbdc

You say:
Who do you think owns BP, Exxon, Andarko etc? Governments?
Gosh your dumb!

I (and Wikipedia) say:
As a group, the “Supermajors” (BP (UK), Chevron (USA), ExxonMobil (USA), Shell (Netherlands &UK) and Total (France) control about 6% of global oil and gas reserves.
Conversely, 88% of global oil and gas reserves are controlled by the OPEC cartel and state-owned oil companies, primarily located in the Middle East. A trend of increasing influence of the OPEC cartel, state-owned oil companies in emerging-market economies is shown and the Financial Times has used the label “The New Seven Sisters” to describe a group of what it argues are the most influential national oil and gas companies based in countries outside of the OECD, namely CNPC (China), Gazprom (Russia), National Iranian Oil Company (Iran), Petrobras (Brazil), PDVSA (Venezuela), Petronas (Malaysia), Saudi Aramco (Saudi Arabia).

Gosh..................... Who´s dumb?
14 briton (#) Feb 15th, 2012 - 09:54 pm Report abuse
We understand you guys, when the brits say you’re sinking, but you just don’t believe it, but when your own people and union bosses and your very own ministers say it,
Then either we are all lying, or you are totally institutionalised.
15 Frank (#) Feb 15th, 2012 - 10:51 pm Report abuse
@13.... and only two and a half of those seven countries are democracies.....
read the question .... thicko......

Speaking of 'thick' I hope you have lots of blankets laid in for the coming winter....
16 yankeeboy (#) Feb 15th, 2012 - 11:37 pm Report abuse
15. They are having huge blackout in BA due to the heat the past few days AND people's electricity bills have gone up approx 248% over last MONTH! Wait until they have to heat their homes this winter. I hear the nat gas bills will be 500% over what they paid last year!
Since it takes about 10 years to find and develop a gas field I wonder what their plan is...oh wait they don't plan.
17 kbec (#) Feb 16th, 2012 - 12:33 am Report abuse
It's OK guys they can use their share of the Falklands oil.... Oh shit I forgot old bugeyes tore up the agreement didn't he
18 ElaineB (#) Feb 16th, 2012 - 01:36 am Report abuse
@16 Tis true. When I was there a couple of weeks ago the power was on and off constantly. A local complained that the power never seemed to go off in the rich districts but I cannot confirm if that is true.
19 Cruzansailor (#) Feb 16th, 2012 - 03:46 am Report abuse
Argentina once had such promise! Pre 1492. Look at the friggin mess you are in now. Circular history for over 200 years. A nation of Dunces led by a nation of corrupt creeps. Yes, Juan and Eva Peron Bamboozled a nation of ignorant immigrants and unionist. Buen Provecho!
20 jerry (#) Feb 16th, 2012 - 04:30 am Report abuse
18 ElaineB (#) - Of course it goes off in the rich districts; the problem is everywhere. It just not go off for a very long time in the “rich districts”.
21 GreekYoghurt (#) Feb 16th, 2012 - 12:09 pm Report abuse
@18,20 It's happening in North Korea too. ( They said they were going to use some candles for Sean Penn's photo shoot though.
22 axel arg (#) Feb 16th, 2012 - 01:28 pm Report abuse
The fell in the reserves of oil and gas, is not only an argentine problem, it happens in others countries, like the u. k. and u. s. a, or why do you think that there are wars in others places of the world by those nations?, dont be so miopic, and dont criticise only our country just because you dont agree with c. f. k's policies, i dont deny that surely her government made mistakes respecting the energetic policy, but the privatization of the former statal company (ypf), is one the most terrible remoras that we still have since menem's neoliberal decade.
23 yankeeboy (#) Feb 16th, 2012 - 01:39 pm Report abuse
22. The USA has unprecedented oil an gas reserves. We have over 100 years of nat gas and we are a net EXPORTER of oil. They predict in 10 years we will be self sufficient in oil. Do you read newspapers?
The Ks DESTROYED your oil/gas exploration by being too greedy, greedier than an AFRICAN nation! This is another nail in the (economic) coffin as one person here likes to say.

How are the teacher salary negotiations going? 3 weeks until classes start right? Do you think your increase is going to keep up with INDEC inflation or real? Even an 18% raise is a huge loss in buying power.
24 briton (#) Feb 16th, 2012 - 01:49 pm Report abuse
The only thing greed gets you, is nothing?
And nothing gets you nowhere.
25 ChrisR (#) Feb 16th, 2012 - 02:17 pm Report abuse
24 briton

I think you may have just misunderstood what the teachers are doing here.

With inflation at 25% and shortly to be 35 - 40% being offered 18% is a pay cut. They are not being greedy for holding out for more.

Whatever they settle at it will be too little before the end of the coming education year and the next round of negotiations.

If I were a teacher or any other fixed income worker in Argentina I would want at least 40% just to stand still (effectively NO raise).

That is the reality for teachers (and others) in Argentina.
26 GreekYoghurt (#) Feb 16th, 2012 - 02:27 pm Report abuse
@25 what about a 100% pay increase and some Louboutin shoes?
27 briton (#) Feb 16th, 2012 - 02:50 pm Report abuse
Miss read,
Yes I should have added the Argentina government,
Not the workers,

My humblest….

28 ChrisR (#) Feb 16th, 2012 - 03:15 pm Report abuse
26 GreekYoghurt

Good idea on the 100% but I don't think they do them in my size. :o)
29 jerry (#) Feb 16th, 2012 - 11:26 pm Report abuse
And the Argentina president and vice president refuse to release their salary/benefits figures. How is that for a democratic and transparent government?
30 GreekYoghurt (#) Feb 17th, 2012 - 01:03 am Report abuse
@29 I guess Mao and Stalin didn't release theirs either.

... when even the Queen of England discloses hers, I think lottery winners are richer these days.
31 fermin (#) Feb 17th, 2012 - 04:38 am Report abuse
@7 axel arg: I agree with you.

Isn't it strange that the article says nothing about the gas reserves found like a year ago??

The word “attack” is not proper for the relationship between the National Government and YPF. These companies are being very LAZY, the country is growing very fast and energy is needed. So they better get to work.

After all... Argentina's production of hydrocarbons and YPF itself began in the first years of the XX Century and grew strong as different initiatives from different governments.

So if the private sector wants to go on dealing with this industry in Argentina it would be fair that they could keep up with efficiency and investments the same or better than the Argentinian State could do.
32 ChrisR (#) Feb 17th, 2012 - 10:12 am Report abuse
31 fermin

“So if the private sector wants to go on dealing with this industry in Argentina it would be fair that they could keep up with efficiency and investments the same or better than the Argentinian State could do.”

Well, as the PRESENT Arg State couldn't run a whelk stall if they tried you would all be in the shitter! Oh, just remembered you ARE in the shitter.
33 GreekYoghurt (#) Feb 17th, 2012 - 11:50 am Report abuse

“Argentina on the verge of “FIGURING OUT HOW A TROUSER PRESS WORKS”, say former ministers”
“Argentina on the verge of “RESORTING TO DINING ON SHOES”, say former ministers”

This I could carry on all day.
34 axel arg (#) Feb 17th, 2012 - 02:20 pm Report abuse
Although you change your nick name, this is evident that you'll always be the same ignorant who handles such partial information, i can understand that it's a placer for you to read this kind of mediocre and hipocrite analysis, but unfortunatelly you have no idea about how missinformed you are. Like i told you before, i dont deny that surelly the government made mistakes respecting the energetic policy, but it since a few years, the exploration was resumed, and in the last two years were found the most important reserves of oil and gas in years, now, they basins must be exploted, and that's why the government must push the corporations, in order to achieve that they start to explote the reserves. And respecting the salaries of the teachers, everyyear there are problems with the colective negotiations, but everyyear our salaries are rased more than 22%, which is bigger than the inflation level, so inform your self better, or you'll continue being the same rediculous who handles so partial information.
35 yankeeboy (#) Feb 17th, 2012 - 03:17 pm Report abuse
Only in Argentina is 22% larger than 30%, btw Jan inflation puts you on track for 40% this year!
That gas field requires fracking Arg and YPF have never done it, don't know how to do it, and you'll be lucky it anything happens with that field for 10 years.
I hope you meager raise can pay for the 500% increase in your nat gas bill this winter.
36 axel arg (#) Feb 17th, 2012 - 06:28 pm Report abuse
The inflation level, which is measured by those so called private analists, was not more than 25% for 2011, and most rases were higher than 25%, beside most middle class like me, will be able to keep the subsides for the services of gas, electric service, and water, anyway it's probable that i renounce to the subside for the water service, because it's not so expensive, i inisist, inform your self better, instead of parroting partial information.
37 yankeeboy (#) Feb 17th, 2012 - 06:46 pm Report abuse
36. So you got 22% raise and even you admit inflation was at least 25% so you have 3% less buying power ( in peso terms) in U$ terms you lost about 10% of your buying power yoy and you still think CFK is wonderful. What a rube!

If you think the “middle class” will be able to keep subsidies through the end of the year you are about as dumb as they come.

BTW I bet inflation will be 35%+ this year, with a HUGE peso devaluation coming in the 2nd or 3rd quarter.
38 GreekYoghurt (#) Feb 17th, 2012 - 09:46 pm Report abuse
@37 I don't think he understands you.
39 axel arg (#) Feb 17th, 2012 - 10:08 pm Report abuse
Read again, it soposes that the inflation level was no more than 25%, according to those so called private analists, and most rases in our salaries were more than 25%, we didn't loss anything of our buying power. Beside, dont be so ignorant, and dont compare your country with mine, it's obvious that your buying power, even if you are still in crisis, will be higher than our's, yours is a developed nation, and mine is a development country, only an ignorant like you can make such a rediculous comparison. On the other hand, it's the government the one that told the society that it will keep the subsides of the services for most middle class.
40 GreekYoghurt (#) Feb 17th, 2012 - 10:21 pm Report abuse
@39 so let's look at what you're saying. Even with inflation at %25 (which it isn't) you would need a pay rise of %25 to match it in order for you to have purchase power parity. If we assume that a large part of the operating costs of businesses are wages, then their operating costs have to go up by %25 in order to match this wage hike, and the cost of purchasing new equipment would have also gone up by %25 because of the increase in costs of buying new equipment.

So, every business in Argentina would have to have increased profits by approx %50 in order to match this on it's balance sheet.

Is this something you see happening? really?
41 fermin (#) Feb 18th, 2012 - 05:15 am Report abuse
@ yankeeboy: “a HUGE peso devaluation coming in the 2nd or 3rd quarter.”

I would like to know what would a HUGE peso devaluation be for you.

We have heard this fake rumors all these years and nothing happened... Maybe you have a good reason for your statement. I am not being ironic, I can't really tell the future.

On the other hand, I would like some of the people commenting here to talk something more apart from “inflation” Inflation is not good for salaries, we know it, but IT IS NOT THE ONLY VARIABLE!

If you don't have inflation but you don't have companies investing it is not good. If you don't have inflation but they are cutting down your salary like in Greece, Spain or Italy it is not good. If you don't have inflation but social care programs are forgotten it is also not good.

And I would like all these that relate Argentina ONLY with inflation to talk about huge international american corporations that also cause inflation. And they cause inflation on basic goods like FOOD.

FOOD's prices have increased a lot since the end of the 90s. If the 1st world economies had invested in production in stead of financial speculation they wouldn't have cause INFLATION allover the world. And so many workers wouldn't be suffering such a strong crisis in different countries now.
42 GreekYoghurt (#) Feb 18th, 2012 - 08:58 am Report abuse
@41 “If the 1st world economies had invested in production in stead of financial speculation they wouldn't have cause INFLATION allover the world.”

Hmm, so the Ministry of Truth says that rather than the economic isolation that is a keystone of Peronism causing the inflation, nor the direct actions of the Kerchnerist government, it's the fault of “someone else”. Why not just blame to inflation on the Falklands while you're at it?

I love how propagandaised weak minded fools always blame someone else for their troubles.
43 yankeeboy (#) Feb 18th, 2012 - 02:11 pm Report abuse
42. Argentinians have a warped sense of economics. Don't bother trying to explain anything related to $ or economics with them. It is a waste of time unless you just want to play along in their fantasy world.
Just take a look at axel and fermin's dumb comments and you'll see what I am talking about.
44 ChrisR (#) Feb 18th, 2012 - 03:14 pm Report abuse
43 yankeeboy

It does seem like the economics of the madhouse. But why does that not surprise me? :o)
45 axel arg (#) Feb 18th, 2012 - 03:14 pm Report abuse
The inflation level is in general, it includes many products, not only food. I dont deny that inflation provokes poverty, but it happens only as long as the rases in the salaries, are lower than the inflation level, it's not the situation of argentina, we had last year an inflation of 22 or 25%, and most rases of the salaries were higher than that. On the other hand, the inflation needs a very ample discussion, it has many reasons, specially the oligopolic groups that we have in the most important sectors of the economy, which dont invest enough, send the money to the foreign, and increase the prizes of the products, those enterprises win so much money in argentina, but most them send remitances to the foreign, this behaviour has a reason, and the truth is that most bussiness men dont trust the economy, due to all the terrible crisis that we had in diferent moments, but they have to realise that the situation is very diferent now, and it will take time surelly, because it's a cultural problem.
46 yankeeboy (#) Feb 18th, 2012 - 03:38 pm Report abuse
45. “ The situation is very different now” Oh really?! Isolationism, capital restrictions, very high inflation, decelerating economy, poor infrastructure, depreciating currency and rampant corruption. Sounds like the same record to me or don't you know your own history?

Let's see what happens when the IMF audits the last 8 years to find that inflation is 2-3X higher than what has been reported and GDP is actually 1/2 to 1/4 of the gov't number. It has all been lies and shortly it will be proven.
47 axel arg (#) Feb 18th, 2012 - 04:04 pm Report abuse
Missinformed and terribly partial as usuall, what kind of isolationism are you talking about?, if you mean the fact that we dont ask for credits to international the market, like we used to do during many years, then i want that so called isolationism. Respecting the capital restrictions, it's necesary to regulate capital out, all the countries do it, regarding the decelarating conomy, it's expectable, most world is in crisis, and it's obvious that it will prejudices us in some moment, anyway the economy will grow this year bewten 5 and 6%, las year it expanded 8, 8%, what you dont tolerate is the fact that we are not in crisis like your so called developed world. Respecting the depreciating currency, it's necesary too, because we must keep the competitivity of our products, beside, you should know that last year, due to the incertitude for the elections time, a record flew from our economic sistem, however the economy didn't colapsed in absolut, finally regarding the rampant corruption, all the cases are under process, and the goods of the suspected poeple were restrained by the justice, i dont how those cases will finish, anyway it doesn't impide the economic expantion, beside, dont be so hipocrite, dont you have corruption cases in your country?, do you live in paradise?.
48 yankeeboy (#) Feb 18th, 2012 - 04:41 pm Report abuse
47. As I told the other poster you are so stupid it makes my head hurt. You are like a patient who denies he has cancer because he can't see or feel it yet.
I just can't believe the gov't actually lets you educate children, oh wait they want the population dumb and gullible to believe the lies. AHA I get it! Axel I pity you like the slow witted child you are.
49 ChrisR (#) Feb 18th, 2012 - 06:28 pm Report abuse
48 yankeeboy

Let us see if the numbnuts can work this one out AND relate it to expansion and inflation shall we. Somehow I don't think they will.

”Annual income twenty pounds, annual expenditure nineteen pounds, nineteen shillings and six pence, result happiness. Annual income twenty pounds (expansion 9%) , annual expenditure twenty pound ought shillings and six pence (inflation 25%), result misery.”

Charles Dickens, 2David Copperfield2 (and he was not the American illusionist).
50 jerry (#) Feb 18th, 2012 - 07:24 pm Report abuse
How about something simple - The cost of a baguette has gone up 331/3% in the past year, and this is common for most day-to-day items.
51 GreekYoghurt (#) Feb 18th, 2012 - 08:01 pm Report abuse
@47-50 From reading ( and ( it clearly states:

”Fueling that growth (9.8%) and inflation is government support for annual wage increases of 30 percent or more.”

Hmm.. brazil printing printing argentinian money.

Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!


Get Email News Reports!

Get our news right on your inbox.
Subscribe Now!