Argentina: How to Benefit from Vast Reserves of Oil and Natural Gas – Without Damaging the Environment

The opening paragraph from this Inter Press Service (IPS) article presents the challenge to yet another country that has accessible fossil fuel reserves.

“BUENOS AIRES, May 15, 2012 (Tierramérica) – Vast reserves of natural gas and oil trapped underground, whose exploitation would signify major environmental impacts, will be the greatest challenge facing YPF, the Argentine oil company that recently returned to state control.”

For Japan, Fukushima put a halt to its nuclear energy program. Germany soon followed with a plan to de-nuke itself before catastrophe occurred. The oil sands of Canada have created a tantalizing opportunity between that country and the United States. Nigeria’s environmental disaster to the Niger Delta has destroyed lives and the economy of seven of its southern states. “Fracking” in the United States offers a technologically “sound” process for extracting vast amounts of deeply embedded natural gas.

This is a list that could be augmented with too many examples of need and outcome. There is no question that energy is one of the most compelling issues for every major nation. And, as we have seen, each energy source offers a variety of strengths and weaknesses. There have been numerous posts addressing these concerns that will not be repeated here.

Now, it appears to be Argentina’s turn in this energy fray. The second paragraph of the same article drives home the challenge for Argentina (and every other country with retrievable energy resources).

“While experts in various branches of engineering and economics are enthusiastic over the prospects of the reserves discovered, they warn that the price paid to benefit from them could be steep.”

We have seen repeatedly, it seems that experts consulted will most often offer strong opinions that support views in favor of extraction. The prospects are always high but it seems that the price paid for these benefits is even higher.

Why has Argentina become so important? The reason is very simple.

“Argentina is the country with the third highest geological potential for these types of hydrocarbons, after China and the United States.” In addition, how could you not give this serious consideration? “The report also states that, although there is a “high degree of uncertainty,” the exploitation of these reserves would significantly increase gas production, create employment and promote the development of new technologies.”

The downside? Exploitation “would also take a heavy toll on the environment.

It is safe to conjecture that favorable options abound and will carry a very strong message that great care would be taken to ensure that the environment is not harmed. So far, I think I am the only one making that statement. But, I would gladly wager that other similar comments will likely be made by real “experts”. In today’s global economic environment, how could this energy remain buried as it has for millenia?

Argentina Faces the Dilemma of Unconventional Oil and Gas. You be the judge.

 

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