A POWERFUL 8.8 magnitude earthquake has struck the Pacific Ocean near the coast of central Chile, with US authorities warning it could generate a tsunami.
The epicentre of the tremor, which occurred at 5.34pm (AEDT), was 117 kilometres northeast from Concepcion, Chile second largest city, the US Geological Survey said.
A tsunami alert has been generated for Australia's east coast following the earthquake.
"Tsunami waves have been observed on the coast of Chile that may threaten Australia," the Bureau of Meteorology (BoM) said.
The BoM said tsunami waves could start affecting Norfolk and Lord Howe Islands after 8:30am (AEDT) on Sunday, NSW could be hit after 8:45am (AEDT) while Queensland could be hit after 8:15am (AEST).
Chilean President Michelle Bachelet declared a state of catastrophe as the country suffered a series of aftershocks. The Santiago airport was also closed.
A geologist told CNN the earthquake was more than 1000 times more powerful than the quake that hit Haiti last month killing more than 200,000 people.
The earthquake was followed by a 6.2-magnitude aftershock, which was followed by a second tremor with a magnitude of 5.6. The third aftershock, the strongest yet, measured 6.9.
Ms Bachelet confirmed 47 people had died with many more deaths expected.
"We have had a huge earthquake," Ms Bachelet said, speaking from an emergency response centre in an appeal for Chileans to remain calm.
"We're doing everything we can with all the forces we have. Any information we will share immediately."
She urged people to avoid travelling in the dark, since traffic lights are down, to avoid causing more fatalities.
Buildings in the capital city of Santiago collapsed and phone lines and electricity were down, making the extent of the damage difficult to determine, AP reported.
The earthquake shook Santiago for more than one and a half minutes.
"An earthquake of this size has the potential to generate a destructive tsunami that can strike coastlines near the epicenter within minutes and more distant coastlines within hours," the National Weather Service said in a statement.
CNN reported a tsunami recording of nine feet, although the extent of damage or casualties was not immediately known.
Tsunami watches remained in effect as far away as Japan and the Philippines after the US Geological Survey (USGS) confirmed a tsunami was generated that could potentially impact the US west coast, British Columbia and Alaska.
The USGS said the watch was extended throughout Central America and French Polynesia.
"Sea level readings indicate a tsunami was generated," the Pacific Tsunami Warning Center said. "It may have been destructive along coasts near the earthquake epicenter and could also be a threat to more distant coasts."
It did not have details on the size of the tsunami.
The quake magnitude reading is based on the open-ended Moment Magnitude scale which is used by US seismologists and measures the area of the fault that ruptured and the total energy released.
The largest earthquake ever recorded struck the same area of Chile on May 22, 1960. The magnitude-9.5 quake killed 1655 people and left 2 million homeless, AP reported.
The tsunami it caused killed people in Hawaii, Japan and the Philippines and caused damage to the west coast of the United States.