Fabiana Videla, a 39-year-old mother of two, recently traveled 75 miles across the Patagonian desert to the remote town of Añelo in northern Argentina, drawn by the promise of employment tied to the Vaca Muerta shale oil and gas field. Once considered a geological curiosity, Vaca Muerta has emerged as one of the world’s largest reserves of shale hydrocarbons, generating significant economic activity and attracting workers from across Argentina.
Located in the Neuquen province, the region has transformed into a hub for oil extraction, with drilling rigs, heavy machinery, and flare stacks dotting the landscape around Añelo. Argentina produced a record 916,000 barrels of oil per day in July, with roughly 70 percent coming from Vaca Muerta, marking a yearly output increase of more than 25 percent. Estimates suggest the field contains over 30 billion barrels of oil, highlighting its long-term potential.
President Javier Milei, speaking at the United Nations last week, described Vaca Muerta as a “historic opportunity” capable of positioning Argentina as a major player in the global energy market. He emphasized openness to international investment in Vaca Muerta while rejecting oil exploration efforts in the Falkland Islands, which Argentina contests. The Falklands’ Sea Lion oil field, located about 140 miles south of Vaca Muerta, is expected to begin production by 2028.
The extraction process in Vaca Muerta relies on hydraulic fracturing, or fracking, to access tight shale formations. This method involves drilling horizontally and injecting a mixture of water, sand, and chemicals to fracture the rock and release oil and gas. However, the boom has brought growing environmental concerns including seismic activity linked to fracking, significant water consumption, waste management issues, and methane emissions.
The rapid influx of workers has strained local infrastructure and public services. Mayor Fernando Banderet of Añelo has cautioned incoming job seekers against bringing families due to overcrowded schools and stretched health facilities. Efforts are underway to address these challenges, including Banderet’s recent visit to China to study fast-paced infrastructure development.
Despite abundant activity, employment is not guaranteed. Many workers, like welders Rubén Obando and Daniel Otero, travel long distances seeking short-term jobs amid rising living costs in Añelo. Meanwhile, Neuquen city, about 65 miles to the east, is witnessing new construction and population growth as businesses and personnel arrive to support the energy sector.
Argentina’s broader economic picture remains mixed. While the oil and mining sectors expand, the national economy contracted by 0.6 percent in the second quarter, and private consumption declined by 2.4 percent. The number of businesses with registered employees has dropped since Milei took office. Political opposition, including Buenos Aires governor Axel Kicillof, has criticized the government’s portrayal of economic progress, citing job losses and wage declines.
Experts note that although Vaca Muerta has not yet translated into lower domestic fuel prices, its output is reducing Argentina’s dependence on imported energy, particularly in winter. Víctor Bronstein, director of the Centre for Energy, Politics and Society Studies at the University of Buenos Aires, highlighted the potential for oil and gas exports to generate much-needed foreign currency, supplementing Argentina’s agricultural export earnings. This influx of dollars could help stabilize Argentina’s economy by supporting imports, debt servicing, and foreign reserves.
For individuals like Videla, the oil boom represents a chance to improve living standards despite the challenges and uncertainties involved. Having earned approximately 1.2 million pesos monthly as a security guard in her hometown, she hopes to find better-paying work in Añelo’s growing energy sector. “They say they need qualified people — builders, engineers,” she said, acknowledging the difficulty but emphasizing her determination to provide a better future for her children.