The eruption of Chile's Calbuco volcano for the first time in over 42 years has devastated the town of Ensenada, and caused the country's residents to look for answers.

Citizens and emergency officials were shocked by Wednesday's eruption, and panic quickly spread across the area. Some said the volcano was a punishment from God.

"An erupting volcano is God's way of showing he is unhappy," said a local, Juanma Ortiz Arredondo.

Most of the city's 1,500 residents evacuated their homes, and no one was reported deceased or injured.

After the eruption, volcanic ash fell as far as Argentina. The country's meteorological service reported an ash cloud as high as 40,000 feet.

Part of the ash cloud took the form of a man, appearing to walk among taller buildings. Several onlookers took photographs of the surprising image.

"At first I thought perhaps it was just me who could see him," said Puerto Montt resident Hariet Grunewald. "But when I showed my friends and family they all agreed."

Manzur Olivo Candelaria was in awe of the image.

"Some dramatic photos came out of the eruption, but I didn't see any quite like this," he admitted. "You can clearly see a head and body and on the face is a pair of eyes and a nose. The eyes seem to be closed, maybe in fear or dread."

Arredondo also felt an ominous message from the formed ash.

"This smoke man is probably a message," the 60-year-old said. "That he is keeping a watch on us and our behaviour."

Emergency officials warned that the ash can contaminate water, halt flights, and trigger respiratory problems. Access to Puerto Varas and Puerto Montt have been closed, a total of 4,000 have been displaced.