MercoPress. South Atlantic News Agency

Argentina warns it could 'fully exercise all actions' over Falklands oil drilling plans

The Sea Lion field, north of the archipelago, is operated by Navitas, which holds 65% of the project, while Rockhopper, which discovered it, retains 35%

Argentina's government warned that it could “fully exercise all” available actions over plans to develop an oil field near the Falkland Islands, in a fresh escalation of the sovereignty dispute. The Foreign Ministry declared the plans of Britain's Rockhopper Exploration “unlawful” and described that company and its Israeli partner, Navitas Petroleum, as “clandestine,” after the Sea Lion project moved from exploration into development.

“Hydrocarbon exploration or exploitation activities in the disputed areas constitutes an unlawful act under both international law and the Argentine legal system,” the Argentine government said, adding that it “reserves the right to fully exercise all available actions to safeguard its sovereign rights and interests.” Buenos Aires invokes Law 26,659 —which requires Argentine authorization to operate on its continental shelf— and UN resolutions that recognize the dispute with the United Kingdom. Rockhopper had already been declared clandestine and disqualified for 20 years in 2012 and 2013, and Navitas was sanctioned in 2022.

The Sea Lion field, north of the archipelago, is operated by Navitas, which holds 65% of the project, while Rockhopper, which discovered it, retains 35%. The British company recently raised its estimate of recoverable reserves to more than 1 billion barrels, which would make it several times larger than Rosebank, the largest known remaining field in UK waters. The first phase will require an investment of about 2.1 billion dollars and produce 170 million barrels from 2028.

Rockhopper's chief executive, Sam Moody, confirmed that the project had received final approval and was funded for its first stage. He told investors that work was already underway, with first drilling planned for early 2027 and oil production a year later. The production and storage vessel Aoka Mizu has been moved from the North Sea to be fitted for its new role. The Falkland Islands Government would receive a 9% royalty and 26% corporation tax. For analyst Dan Slater, of Zeus Capital, it is a “world class discovery.”

The latest clash followed a speech by Argentine President Javier Milei on Malvinas Day in April, when he warned that his government “will respond with all necessary diplomatic measures” to protect the country's interests. “We act with determination against unilateral and illegitimate activities that seek to exploit resources belonging to the Argentine people,” he said. Milei maintains he will use only diplomatic pressure, though he has announced a sharp increase in military spending that includes the purchase of two dozen F-16 fighter jets from Denmark.

The controversy comes as Argentina expands its oil output thanks to the unconventional Vaca Muerta deposit, where British companies such as Shell, BP and Harbour Energy play a leading role. There are fears Buenos Aires could sideline those firms if Rockhopper and Navitas press ahead with Sea Lion.

The Falkland Islands are a self-governing British overseas territory, so the ban on new exploration that the United Kingdom is pursuing in its own waters does not apply there. A Foreign Office spokesperson said “any decision regarding Sea Lion is for the Falkland Islands government and the private companies concerned,” and reiterated that London is “unwavering” about its sovereignty over the archipelago and the islanders' right of self-determination. Argentina and the United Kingdom fought a brief war over the islands in 1982.