MercoPress. South Atlantic News Agency

Falklands’ Premier Oil joins Argentina’s ‘black list’ of companies ‘illegally’ operating in Malvinas waters

Premier Oil has plans to begin pumping oil from offshore Falklands by 2017/18

United Kingdom’s Premier Oil PLC has been incorporated to the black list of companies banned by Argentina from operating in the country because of its hydrocarbons ‘illegal and clandestine’ activities in the continental shelf next to the Malvinas Islands without the competent authorization.

Resolution 481/2013 signed by the Energy Secretary Daniel Cameron and is based on the Argentine Law 17.319 which refers to hydrocarbons exploration and production in the country.  

Premier Oil thus joins four other AIM listed oil companies carrying out exploration work in Falkland Islands waters which in August were also barred from operating in Argentina for twenty years: Borders & Southern Petroleum, Desire Petroleum, Argos Resources and Falkland Oil and Gas. According to the Argentine government website the ban was implemented with four resolutions: 456/2013; 457/2013/ 458/2013 and 459/2013 from the Energy Secretary.

The 481 resolution says that Premier was notified on 2 August 2012 of Argentina’s determination of initiating all the necessary legal, judicial and administrative actions in defence of resources in its territory, and thus the British company was exposed to sanctions in the different areas.

Premier had ten days to reply the notification but ignored it, thus in consequence resolution 260 from May 2013 declaring illegal and clandestine the hydrocarbons activities of the AIM listed company in the Argentine continental shelf. The final resolution was notified through the Argentine foreign ministry on 11 July 2013.

“The illegal and clandestine activities” from Premier Oil Plc refer to the farm-out deal agreed with Rockhopper Exploration, which is the titular of the ‘illegal’ licences awarded by the ‘illegitimate government of the Malvinas Islands’, and of which Premier acquired an operational percentage.

In July last year Premier Oil announced a one billion dollars deal to farm in and develop Rockhopper Exploration oil and gas discoveries in the Falkland Islands. Premier said it would partner Rockhopper paying it an initial 231 million dollars in cash as well as providing around 770 million to help build infrastructure for the development of the Sea Lion field 2010 oil discovery in the north Falkland basin.