Earthquakes spark Vaca Muerta backlash

  • Jan 29, 2019
  • Newsbase

On January 24 and 25 residents of the town of Sauzal Bonito blocked trucks from delivering sand and other supplies along the motorway that runs between Cutral Co and Anelo. The road is the main route into the Vaca Muerta and an essential supply line for companies working in the shale.

The residents demanded to know why 38 earthquakes had hit their town in a period of 36 hours earlier that week. The quakes were recorded at a magnitude of 4.1, which, though relatively small, caused house walls to crack and reportedly damaged a pump that left the town short of water.

The Neuquen government, which is a major backer of the Vaca Muerta’s development, stepped in to mediate with the residents, who subsequently agreed to end the blockade.

The government promised that the National Institute of Seismic Prevention would install seismographs for tracking and measuring activity near the town, and would seek answers for why seismic activity had recently picked up. It also vowed to replace the broken water pump and to review the damage caused to houses in the area. Three homes were found to be more damaged than others from the quakes.

The end of the community action eased the concerns of oil companies that had feared an extended interruption to their work.

Sauzal Bonito is located 2 km away from Fortin de Piedra, where local group Tecpetrol has ramped up its shale activity recently. The company is working its way through a US$2.3 billion investment programme that has seen it go from producing almost zero gas in the block to more than 14 mcm per day (5 bcm per year) in around two years. The block – the most productive for gas in the play – is now producing nearly 11% of the country’s 130 mcm per day (47 bcm per year) of gas.

The rapid expansion of output from the block highlights the shale play’s potential. It has enabled the country to end years of shortages and start exporting gas again after more than a decade-long halt, with deliveries to Chile starting last year and supplies to Brazil and Uruguay due to resume this year. But the quakes have alarmed residents, with other seismic activity registered elsewhere in the play over the past month.

Lacking much information about the reasons for the uptick in seismic activity, residents are blaming the shale drilling companies.

The firms and local authorities have said that there still are no links between the increase in seismic activity and fracking, with some pointing to the existence of fault lines in the area, including one that runs under Sauzal Bonito.

Last week’s events should serve as a warning to shale developers, however. It is the first sign of a potential social backlash to the development of the Vaca Muerta and signals the need for companies to enhance transparency about their operations. This would go some way to assuaging the concerns of local groups that could mobilise again and cause more prolonged and damaging disruption next time.