Argentine Oil Privatization
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Argentine Oil Privatization
by Michael Colangelo
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The Beginning of Oil
Comodoro Rivadavia was created in 1901 as a commercial port for agricultural
and livestock products in Patagonia. Life in this isolated, windy and arid land was difficult. There was little water, few roads, and hardly
any communication with the rest of the country. In a 1907 search for water, petroleum was discovered in Comodoro, the first
oil discovered
in Argentina. That same year, the national oil company (Y.P.F.) was created.
Only 800 people inhabited the town at the time, most involved in the commercial activities
of the port. However, the discovery of oil drastically changed the
lives of Comodoro's original inhabitants. |
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After 1907, Comodoro Rivadavia experienced increasing development
due to oil, leading to the foundation of the national oil company town. Y.P.F. recruited skilled migrant workers from Europe, particularly
Spain, Portugal, and Russia. However,
work was difficult for these immigrant workers, as former Y.P.F. electrical
technician Juan Stancheff accounts: |
“Of course when they got here,
let's say all the Europeans suffered a lot. Because I remember how
they worked. Before transportation of things, they had to carry everything
on their shoulders. They carried things and it wasn’t
easy like now. They worked ten to twelve hours, there was a lot of
wind. You have seen the machines, they’re in the museum, what’s
left. The work, the wind, the equipment was harder to work with and
the work was more manual.” |
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Despite difficult labor conditions, the national oil company grew in its early years. From 1907 to
1916, the company’s oil production increased from 16
to 130,000 cubic meters. While the national company was still
by far the largest
oil company in the area, the presence of private oil companies, such
as Astra, Ferrocarrilera, Diadema, and Bahio Solano, began
after 1916. From 1917 to 1922 the national oil company nearly tripled
its production. However, Y.P.F. still
grew at a slower rate
than its competitors because President
Yrigoyen required that the company fund its expansion
solely with company resources. To increase
profits and fund the company’s growth,
the national oil company began paying low wages and neglecting working
and living conditions. The disregard for safety at the workplace resulted
in a high accident risk.
Juan Ivanoff, whose father worked at Y.P.F. in its early years, elaborated on
the issue of safety: |
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“In that time the human being
did not matter. What was important was to get the oil. If petroleum
had to be drilled then petroleum
had to be drilled. If in the middle of the operation someone died,
and well someone died.” |
The poor conditions that workers endured led
to a series of strikes in 1917. The strikes led to an increase in already high turnover
rates due to the difficulty and temporary nature of the work. The strikes peaked in 1920,
when more than 97 percent of workers left the national company. The
government viewed European workers as the instigators
and therefore began to recruit more native Argentineans. However, in 1922,
the local administer resigned because of the labor conflicts and the lack of
consistent
policy measures due to administrative problems. |
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