Footage from the area shows a huge column of lava and ash being sent several kilometres into the air. The authorities have declared a red alert and evacuated more than 4,000 people within a 20km (12 mile) radius. The Calbuco volcano is one of the most active in Chile, but its eruption took officials in the area by surprise. Alejandro Verges, an emergency director for the region, said Calbuco had not been under any special form of observation. 'Very frightened' The inhabitants of the nearby town of Ensenada - along with residents from two other smaller communities - have been ordered to evacuate their homes. Schools in the area have been shut and some flights cancelled. The nearby city of Puerto Montt - a gateway to the popular Patagonia region - has already been blanketed in a cloud of ash. TV footage showed traffic jams in the city and long queues at petrol stations. The nearby town of Puerto Varas was also under a state of alert. Mayor Gervoy Paredes said residents were "very, very frightened". "I had never seen this before. It scares you in the beginning. You start to wonder what is going to happen to you," said one unnamed woman. "Everyone starts to think about gathering water and I don't know what. We got together with the neighbours to see what we would do and wait for news over the radio because we knew that they were evacuating Ensenada and other places near the volcano." Interior Minister Rodrigo Penailillo called on people affected to "remain calm and stay informed". Neighbouring Argentina has also put emergency measures in place for the city of Bariloche - about 100km from Calbuco - where ash clouds are expected. Residents there have been warned to stay indoors. Chile has the second largest chain of volcanoes in the world after Indonesia, with about 500 that are potentially active. It is southern Chile's second volcanic eruption in as many months. In March, the Villarrica volcano erupted in the early hours of the morning, spewing ash and lava. The authorities say this latest eruption is more serious.