MercoPress. South Atlantic News Agency
Oil and gas production in Argentina has fallen to its lowest in 25 years
Oil and gas production in Argentina has fallen to 1981 levels, the lowest in 25 years, despite a $14 million government subsidy for the first five months of this year. From last year to May 2017, the country has produced 2,311,736 m3 of oil and just under 3.8 billion m3 of gas, which shows a drop of 6% and 1.8% respectively. Read full article
Comments
Disclaimer & comment rules“Argentina closer to energy self sufficiency” Mercopress note, March 2017. Um, maybe not.
Jul 12th, 2017 - 01:54 pm - Link - Report abuse +4“...This trend of decline has been continuing since 1998,....” Yup. Mostly peronist years.
According to local media, nafta (petrol) pricing in Argentina now the second-highest in South America, after Uruguay..... in spite of the country having vast oil and gas reserves.... that it just can't seem to develop efficiently. High labour costs with excess employees, and prohibitive local royalties, keep average production costs above US$50 a barrel. During a 5-year period of the CFK regime, typical well-drilling costs increased over 80%, largely due to padded labour and inflation.
There goes another one of the many promises made by the “best team of the last 50 years” put together by president Mauricio Macri to improve business in Argentina.
Jul 12th, 2017 - 08:07 pm - Link - Report abuse -5Meanwhile, Macri's Joyful Revolution has produced the loss of over 22,000 layoffs in the first six months of the year, with a total 264,000 since Macri took office in Dec. 2015.
And while some denounce “errors” in the government's economic direction, others point to a deliberate effort to increase unemployment, forcing workers to accept lower wages and deteriorating working conditions.
This would go hand in hand with Macri's previous statements in which he predicated competitiveness on lower wages--much like our friend Martillazo's “padded labour” cliche above.
It's a trend, reekie, in the area of declining petroleum production. Do you not understand the concept of trends?
Jul 12th, 2017 - 09:45 pm - Link - Report abuse +5Here is another trend for you: when your country has little to nothing to offer in goods and services for prices that markets are willing to pay, don't expect that people will continue to be employed.
Low productivity, high taxation, and high labour rates: a portrait of the trends in Argentina.
In the news:
Argentine labour rates are 50 percent more than those of Brazil.
And it just stands to reason that since Argentine workers are over-paid, that they should also be over-taxed. Income tax in Argentina is the highest in Latin America, if we believe the studies.
Gotta pay those ñoquis somehow.
Once again, Kamearad/Komrade Rique says : “Blah blah blah blah Macri. Blah blah blah blah blah blah blah Macri. Blah blah blah blah blah blah Macri blah blah blah.”
Jul 13th, 2017 - 07:02 pm - Link - Report abuse +1Of course he is merely exercising his right as an SJW (Socialist Justicialist Wrecker,) in an attempt to draw attention away from how much damage was done by the previous Peronist regime to the oil industry after it's seizure by the government...
http://3.bp.blogspot.com/-IOU-X8U759Q/T5XuG-ySq0I/AAAAAAAABIc/d6GYFy14by8/s400/AXEL-KICILLOF-YPF-300.jpg
News flash, the “Dead Cow” is still dead!
And as if all those other “poor productivity through high costs” factors were not enough, we discover that the peronist-era high taxation for importing hydrocarbon-drilling/extraction equipment -- of 25% or more - is still in place ! (Those taxes were put in place to make the Repsol-era oil production too costly to be profitable, and to discourage investment in modernising oil production equipment). The dark shadow of persistent peronist pestilence is still upon the land.
Jul 13th, 2017 - 10:13 pm - Link - Report abuse +1But rest assured Kamerad/Komrade Rique supported those taxes, as well as the nationalization, and I have no doubt he supports them remaining in place. ;)
Jul 14th, 2017 - 12:12 am - Link - Report abuse +1http://cdn.static-economist.com/sites/default/files/images/print-edition/20120421_AMD001_0.jpg
Another global trend that is gaining momentum is the rise of renewable energy. This could play out in all sorts of interesting ways as the oil-producing nations will start to lose their main customers and oil/gas that is difficult to extract will become uneconomic. I don't know how much renewable energy Argentina produces but to global average is now about 20% so maybe Argentina should start subsidising renewable energy rather than fossil fuels?
Jul 17th, 2017 - 06:25 pm - Link - Report abuse 0Beezlebub, “ renewable energy” for electricity is one thing but here natural gas is likely to be the only meaningful mechanism for heating this country for the next decade or more. Rail transport here is in decay so even electrification opportunities won't help rail, and the beginnings of electrified long-haul road transport are still more a decade away here. Subsidies? Argentina is bleeding cash now in deficit spending and can ill afford to subsidise any more dubious causes that historically turn into new corruption opportunities. Meanwhile, low petroleum prices elsewhere don't seem to help the high costs to import gas and oil which are feeding the usual sort of high inflation around here (we had an increase of more than 7 percent in fuel prices recently and over 15 percent fuel prices increase so far this year).
Jul 17th, 2017 - 10:17 pm - Link - Report abuse +1Here is how Argentina operates its new power generation systems: the Rio Turbio coal-fired plant - the very picture of corruption and poor planning (articles in cristiano) for a highly contaminating new but nonoperational coal-fired power plant.
“ Así se descubrió y denunció el desfalco en Río Turbio”
“ El día que Cristina Kirchner y Florencio Randazzo inauguraron una obra trucha de Julio De Vido ”
“ Reabren otra causa contra De Vido por la usina térmica de Río Turbio”
“ Río Turbio: el terreno donde se hizo la usina eléctrica es inundable ”
“ Más problemas en la obra de De Vido en Río Turbio: prohíben operar la usina de carbón hasta que sepa dónde irán las cenizas”
Rio Turbio... living proof that the RGs couldn't organise a pissup in a brewery.... http://www.sourcewatch.org/index.php/R%C3%ADo_Turbio_power_station
Jul 18th, 2017 - 03:01 am - Link - Report abuse +1That classic mismanagement of natural gas production here is now (our winter) causing some businesses to reduce or shut down their operations. Some service stations are being told they cannot sell any compressed natural gas (used for motor vehicles) at all. This is primarily the result of years of failing to construct adequate gas handling infrastructure (storage facilities) in this country. A lot of our electrical power in southern Argentina is based on natural gas and currently (no pun intended) the shortages are adversely affecting power generation.
Jul 18th, 2017 - 04:11 am - Link - Report abuse +1Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!