Milei’s Argentina is fast becoming the Texas of Latin America
By Paul Homewood
Could this be the same AEP who keeps telling us fossil fuels have no future?
President Javier Milei has flawless timing. Argentina’s shale boom has reached industrial take-off just as he embarks on his extreme libertarian experiment: a Hayekian free market assault on the delinquent Peronist state and all its works.
The long-suffering nation is swinging very fast from a costly dependence on energy imports, and a chronic leakage of hard currency, to the happier condition of net hydrocarbon exports. The prolific shale basin of Vaca Muerta is finally delivering.
After years of talk and many dropped balls, this arid expanse of northern Patagonia is suddenly starting to look like the next Texas, promising to draw in the serious dollars needed to stabilise the ruined peso and make all else possible.
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“It is not the same Vaca Muerta of 10 years ago, and we’re only doing a fraction of what we could do,” said Horracio Turri from Pampa Energy.
The US Geological Survey estimates that the region holds the world’s second biggest reserves of shale gas, and fourth biggest reserves of shale oil. Drilling has begun at another shale basin at Palermo Aike in Argentina’s deep south, so the potential could be significantly larger.
“Oil is what will put Argentina back on its feet because it is going to be a very big source of foreign currency. We have to start thinking like a petro-state because we are a world player in the making. First we have to tackle our infrastructure problems,” said Mr Turri, speaking at the Vaca Muerta Insights 2024 forum.
McKinsey estimates that new fracking technology – smart drills, geonavigation, multi-drilling from the same pad – has cut production costs to $36 (£29) a barrel, an irresistible business in a world market with a structural price of $80-$90. It is the best low-sulphur light sweet crude. Gas comes in at circa $1.60 (MMBtu), low enough to produce liquefied natural gas (LNG) for export to Europe at competitive cost.
Shale oil output has quadrupled to 380,000 barrels a day (b/d) over the last three years, suddenly beating expectations, and tracking the Permian growth trajectory that so stunned Saudi Arabia, OPEC, and the old petroleum order.
The government target of 1m b/d already looks too modest, with wildcatters in Neuquén talking of Norwegian levels above 1.5m b/d as the potential peak.
“We think we can triple oil and double gas by 2028,” said Miguel Galuccio, founder of Argentina’s Vista Energy, which sank eight new wells here in March alone.
Horacio Marin, YPF’s Texas-trained chief executive and Milei insurgent, says he will make it his business to ensure that Argentina is generating $30bn a year in hydrocarbon exports by 2030 or shortly after.
“We’re doing this for the Argentine republic, and for our children. If we can bring in $30bn we’re not going to have any more exchange rate problems,” he said.
He is pioneering a form of ‘lean fracking’ based on the Toyota manufacturing model.
“We want the construction of an oil rig to be as efficient as the construction of a car. It gets rid of layers of operational bureaucracy and makes us extremely competitive. Not even the Americans are doing this,” he said.
Ex-president Cristina Fernandez Kirchner can only gnash her teeth and rail at the injustice of fortune, as shale technology and the global commodity cycle deliver nicely for her mortal political foe.
“Milei’s plan is not anarcho-capitalism, it is anarcho-colonial. The recovery strategy is now clear: it’s oil, gas, mines, and grains. He wants to turn Argentina into an extraction country for raw materials. This pre-capitalism takes us back to the days of the Viceroyalty,” she said.
Alternatively, it harks back to the halcyon days before the First World War when Argentina enjoyed a prosperous place as Australia’s twin in the British imperial and commercial system, shipping commodities to Europe. It was the best of times for Anglo-Argentine concord, culminating in Harrods of Buenos Aires, the only foreign branch ever opened abroad.
A century later, Australia still manages to leverage its resource and farming wealth into a high-tech economy of top tier affluence. There is no foreordained reason why Argentina cannot do much the same.
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NOT A LOT OF PEOPLE KNOW THAT 
Argentina’s climate pledges scarcely enter the debate – Telegraph.
There you have it – no net zero nonsense.
Hooray!!! Finally a country leader willing and able to tackle the Globalist mafia.
Really … to all ? Thought that poor Argentina was a basket case, according most Euroland Media stories of past years. But it looks OK to me otherwise from Sat Progs I watch, etc..
Don’t cry for us Argentina
We also have shale gas and oil
But ours must stay in the ground
While you develop and make your Nation rich
Meanwhile, here we face fuel poverty due to
Price and Availability
Please don’t cry for us Argentina
Unless it tears of sorry that a once Great Nation
Has fallen so low.
Shale gas under my house, we need to get fracking again too. Afuera with uniparty thermageddonista dross.
Wytch Farm too of course under Sandbanks still going for now.
https://theconversation.com/poole-oil-spill-expert-qanda-why-is-there-an-oil-field-in-dorset-anyway-202769
In my second job I worked on a contract supplying pumps to the the BP owned oilfield.
micda67: good news for Argentina but we need to know the individual well flows and the seismic levl employed, i.e. the permeability of the shale, its already been established that our shale, like most, is too impermeable to flow viable gas.
Kirchner is correct. Hardly any of this ‘wealth’ will stay in Argentina. Its mainly US bound.
america has it own natural resources where a Millei could work wonders. the JB aka FJB government is slow walking all aspects of resource development.
The wealth in Argentina will be distributed between those willing and able to get in the action. That could include the UK oil firms if they chose to. Would that be the wealth ending up in Britain?
will the Brits grow a pair and vote in pols capable of exploiting your own wealth? Could that be done with local entrepreneurs or is that word unknown in today’s UK?
Unlike Chavez and Maduro’s policies of course.
Same thing happened in Norway, Ekofisk developed by Phillips Petroleum all the profits went to the US. Oh wait a minute…
Is this part of his ego war with his colleague Jeremy Warner? JW was turning his nose up recently about Poland getting rich from unfashionable activities such as mining.
There used to sneering at “banana republics”, but at least they produced something to sell to the world.
Methinks anything right of Stalin is ‘extreme’ to AEP.
Isn’t that standard for the legacy media? Extreme? Far Right? No, just not a far left globalist fascist.
Paul, I really, really apologise for being so off topic, but in the DT the boss of BG, who has said that SmartMeters should be made compulsory, is being slaughtered in the comments. I have never seen such a pile-in! It’s wonderful to see! 🤣😀😃
Have you got the link?
Think this is the one… https://www.telegraph.co.uk/business/2024/05/08/ftse-100-markets-latest-news-currency-interest-rates-cuts/ All the best, Harry
I have come to view O’Shea as an ignorant tosser and am pleased I sold my Centrica shares. He bleats about the cost of energy given that Centrica owns supplier British Gas but nowhere does he mention that the government’s insane energy policy is the reason our energy is so expensive. You don’t need a ‘smart’ reader to know your energy consumption although I do concede that in some houses the meters are hard to access. I was astonished to see my weekly electricity use increase and traced it to using an old, but sometimes more effective than newer ‘smart’ ones, battery charger.
Reads like a petro booster press release, copied & pasted by AEP.
Argentina…….the place where common sense goes to die
Sad to see Richard Tol so far on the dark side, but the comments seem to nail the situation where the article does not:
https://www.dailymail.co.uk/sciencetech/article-13394935/Thames-Barrier-London-sea-climate-change.html
Given that the barrier allegedly was built to last until 2030, extending it to 2070 suggest good engineering. The sea level rise twaddle is just that – and aside from a stormy period in 2013-14 it seems that the barrier has not had a great deal of use.
To be generous to Richard Tol, he might well be one of those who believes that ‘scientists’ that work in anything related to making money from climate change are competent and honest, and therefore what they say is correct. However, as we know, the claim on increasing wild weather is not supported by data. An interesting thing would be to know is if the Thames Barrier is sinking along with the rest of London? I can never remember where I read it but there was an article that said that the barrier was being closed less than expected over the last few years.
On Saturday R4 FooC was pushing the narrative “Miliei Man Bad Inflation still rising”
Their trick was to look at Annual inflation
Last year monthly inflation rose month and month thus feeding now into annual inflation.
but in the real world Argentina monthly inflation is NOW falling
..meaning annual inflation will fall in 12 months time
The Woke left are pretty much against any form of extractivism, but seem unable to come up with any alternative that brings in the Dollars needed to keep these countries running, IMF loans excluded.
We see exactly the same denial of fiscal reality here in Chile with Boric as was the case in Argentina under the Kirchners, despite the fact that Chile is only viable thanks to its Copper exports.
“Argentina fast becoming the Texas of South America.”
When you are a hack journalist there is nothing like starting with some ridiculous hype. Argentina produces 700,000 barrels of oil a day and Texas 5,600,000.