Fracking Debate under way in Latin America

In recent years, the debate about the reserves of shale gas in Latin American countries, such as Mexico and Argentina, has led to the formation of a growing civil movement against it. Sandra Guzman reports from the region.

vertically drilled wells

Instead of investments in fracking, civil society in Latin America demands stronger efforts to foster renewable energies. (Photo by Peter Aengst, CC BY-SA 4.0)

The fracking technology is quite new and several scholars are still debating about its real potential and implications on the environment. Even though there is no international agreement about the problem, some US states, such as New York and countries such as France have already banned the activity.

In Latin America, however, governments have first and foremost been involved in the debate about the economic potential of fracking, without a comprehensive analysis of the social and environmental impacts of the activity. In Mexico, the government approved a major reform to the core of the legal framework (La Constitución Política de los Estados Unidos Mexicanos) in order to allow for private investments to play a greater role in the extraction and production of fossil fuels, including non-conventional sources such as shale gas. Until recently, these were controlled by the state. Even though the government has said that this reform will lead to less public spending, the government is still investing a significant amount of public money to encourage this activity, which could have an impact in the development of clean energy technologies that have to date been suffering from a lack of public investments.

Mexico is a country that suffers from severe water shortages, particularly in its northern regions where the majority of shale exploitations are underway. And the country has also commitments to reduce greenhouse gas emissions. The northern shale gas explorations show that the country is taking the opposite route to its climate goals. In fact, the country’s Special Programme on Climate Change recognizes that “it is important to note that the recent energy reform is likely to increase the GHG emissions in this sector” (PECC, 2013: 17). A key aspect of this increase will be due to the emitted methane, a much more potent greenhouse gas than carbon.

Although the fracking activity in Mexico still is mainly in its exploration phase, it is important to analyse the context of the country. Here, you can find two major contradictions:

  1. The government is willing to exploit shale gas reserves to ensure national energy security; yet the same government is currently building infrastructure to transport natural gas from the US to Mexico, thereby increasing its gas dependency on the United States. The pipeline Los Ramones in Nuevo Leon (116 km) connects Agua Dulce in Texas and Los Ramones in Mexico;
  2. By initiating the energy reform, the Mexican government is asking for private investments to help ease the pressure on PEMEX. However, this state-owned company will still invest approx. USD $5.5 billion in the expansion of natural gas pipelines and other fossil fuel activities, including the USD $2.5 billion still to be invested in the second stage of Los Ramones. The President of Mexico has announced that he has the intention to build around 8,500 km of new gas pipelines increasing Mexico’s pipeline infrastructure by 75%.

In the case of Argentina, the scenario is not very different. According to the US Energy Information Administration (EIA), Argentina has one of the world´s largest endowments of shale gas, the Vaca Muerta project (“Dead Cow”) in the city if Neuquén being the main and most controversial one. According to the EIA the reserves of Argentina could satisfy the energy demand of the country for the next 150 years, constituting an estimated 27 billion barrels of oil and 802 trillion cubic feet of shale gas. The debate about the real potential of these reserves is still ongoing. However, legal reforms to incentive private investments in this sector have given more power to YPF, Argentina´s oil company that has taken control of the fossil fuels after the country’s re-nationalization of the oil industry.

Although the control of oil companies in Mexico and Argentina is different, both are encouraging the use and extraction of shale gas without considering a comprehensive analysis of the social and environmental impacts at the local scale.

In the case of Mexico, the environmental authority has said that the extraction of shale gas will contribute to the production of “clean and environmental friendly fuels”, and there is a claim that the creation of the new national Agency for Environment Security in the hydrocarbon sector will deal with the environmental problems. However, an increasing number of civil society organizations claim that this agency would give more power to the hydrocarbon sector instead of protecting the environment. In the case of Argentina, there is widespread recognition that the national legal debate around energy issues does not include environmental considerations.

The main complaint of civil society groups in Mexico and Argentina is that there was no public debate about the development of shale projects, and that the governments are not putting enough efforts into serious studies that analyse the implications of shale oil and gas development on the local level. The Mexican Alliance Against Fracking, a group of environmental organizations and civil society groups, has started a movement against the activity, trying to advise people, Congress representatives and other political actors about the potential local impacts of the fracking method, highlighting that irresponsible actions today could, in fact, cost more in the medium and long term than a thought through sustainable energy policy.

The fracking activity poses one of the major challenges to energy policies worldwide. Too little is known about the local implications on society and the environment. Energy policy on fracking in Latin America and elsewhere should be based on science and studies that provide insights on the issue in a holistic matter, taking economic, social and environmental concerns into consideration.

Sandra Leticia Guzman Luna holds a Masters Degree on Environmental Policy and Regulation from the London School of Economics and Political Science, she studied International Relations at the University of Mexico (UNAM), and is a specialist in Environmental and Energy Management from the Latin-American Social Science Institute (FLACSO).


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