London’s newfound ambitions in the South Atlantic Sea are unlikely to meet much resistance from the Milei government.
The Malvinas, or Falkland Islands, dispute is back in the headlines in Argentina, albeit not on the front pages. The cause this time is mineral. For over a decade, the British government, together with the British company Rockhopper, has been exploring the islands’ waters for oil. And they appear to have finally struck black gold — purportedly some 500 million barrels of the stuff. Now comes the tricky task of extracting it from the islands’ heavily disputed waters.
Over the next few weeks, a statuary consultation will take place on the islands, at the end of which the local residents, the so-called “Kelpers”, will vote on whether to allow the drilling of around 23 wells in an area known as Sea Lion Field, located roughly 220 kilometres north of the islands. If given the green light, Navitas Petroleum, an Israeli energy company, could begin drilling later this year. Navitas expects to extract more than 300 million barrels over the next 30 years, most of the profits from which will go to its shareholders in Israel and the US.
Echoes of Essequibo
The royalties from the drilling could also transform the archipelago’s fishing and tourism-dependent economy, much as the recent drilling of oil in disputed waters off the coastline of Guyana has enriched that country’s economy, albeit at a high price. As we reported late last year, Exxon Mobil’s drilling in Guyanese waters has reignited a centuries-long border dispute between the former British colony and neighbouring Venezuela, with the Maduro government going so far as to hold a referendum on the annexation of the disputed territory of Essequibo.
Guyana was a former Dutch and then British colony and Essequibo a vast 160,000 square-kilometre chunk within its territory that has been claimed by Venezuela for the past 200 years. While Guyana is a former British colony, the UK’s ownership of the Falklands is very much ongoing. There is also a huge disparity in the size of the respective oil discoveries. According to U.S. Geological Survey estimates, Guyana’s coastal area has roughly 13.6 billion barrels of oil reserves and 32 trillion cubic feet of gas reserves waiting to be drilled — over 26 times the amount of oil so far discovered off the Falklands.
In Argentina, Gustavo Pulti, an MP for the Unión por la Patria party, has presented a bill in the provincial Chamber of Deputies calling on the Javier Milei government to address the situation. Like many opposition MPs, Pulti accuses the Milei government of “doing nothing” to defend the sovereignty of Argentina in the face of constant encroachments from London. He’s got a point.
In the space of just five months, the UK as unilaterally expanded the no-take fishing zones — areas where fishing is banned for environmental reasons — around the South Georgia & South Sandwich Islands (SGSSI), near the Falklands. As a result, 166,000 km2 will be added to the 283,000 km2 over which the ban was already in force, after the British authorities created the Maritime Protected Area (MPA) in 2012. London has also confirmed plans to build a new port in the Falklands, which could be used as a forward base for British interests in the Antarctic. Now, to cap it all off, it is about to begin drilling for oil in the Argentine Basin.
Located 250 miles off the southern tip of Argentina and 8,000 miles from British shores, the Malvinas/Falklands, home to 3,500 mostly British people, have been the subject of a territorial dispute between the UK and Argentina ever since 1833, when a British expedition invaded the islands, evicted their inhabitants and planted the British flag. After the Suez disaster of 1956, the British government began divesting itself of most of its colonial holdings in Africa, Asia and the Caribbean (while, of course, building a vast web of tax havens in their place). However, London made sure to hold on to the Falklands, for its obvious geo-strategic benefits.
Now classified as a British Overseas Territory, the islands are technically self-governing, with defence matters and foreign affairs handled by the UK government. London regularly cites the fact that almost 100% of the residents of the archipelago approved remaining under British control in a referendum held in 2013. Argentina maintains that the islanders were essentially implanted by the British colonisers.
In 2022, The UN’s Special Committee on Decolonization adopted a resolution calling on both governments to “consolidate the current process of dialogue through the resumption of negotiations to find a peaceful solution to the sovereignty dispute.” Most of the delegates supported the call for renewed dialogue. Pakistan’s delegate, speaking on behalf of the “Group of 77” and China, stressed the right of Argentina to take legal action against unauthorised hydrocarbon exploration and exploitation in the area.
Milei’s Silence
During David Cameron’s visit to the islands in February — the first of any British foreign secretary in 30 years — Cameron said he hopes the territory will want to remain under UK administration “for a long time, possibly forever.” Given the island’s rich mineral deposits and geostrategic location, this should come as no surprise.
Nor should the fact that the UK’s newfound ambitions in the South Atlantic are meeting next to no opposition from Argentina’s President Javier Milei. From our May 8 article, In BBC Interview, Javier Milei Shows His True Colours on Falklands Issue While Praising His “Idol”, Margaret Thatcher, to the Skies:
In [a recent BBC interview], not only did Milei reiterate his admiration for [Margaret Thatcher, who infamously ordered the torpedoing of the ARA Belgrano, an Argentine cruiser outside the theatre of operations, leading to the deaths of 323 people on board]; he also did something that no other Argentine president of the post-Falklands War era has ever done: he admitted that the Falklands, or Malvinas, are, to all intents and purposes, British.
Asked if he considered the recent visit by UK Foreign Minister David Cameron to the Falklands to be a provocation, Milei said: “No, because that territory today is in the hands of the United Kingdom. In other words, he has every right to [visit the Falklands].”
[At the same time, Milei] said he will appeal to the British establishment’s better nature (over the Falklands dispute] without applying any kind of political or diplomatic pressure, as previous Argentinian governments have tried to do, albeit with little success. Nor does Milei appear to be in any hurry to press the issue. Now, he said, is not the time to discuss the territorial dispute, which, he added, could take decades to resolve.
It is, to all intents and purposes, the geopolitical equivalent of kicking the can as far down the road as possible while seemingly seeking to cosy up to the British government.
“We have a lot of other issues on the agenda that [Argentina and the UK] can work on together and we are willing to do that. I think it’s the adult (yes, that word again) way to do things.” It makes more sense, he added, to “be working with the United Kingdom”, rather than “arguing and fighting” over an issue that will take inordinate amounts of time to resolve.
In other words, Argentina, under Milei’s government, will be working closely with its long-time adversary on a whole range of issues while consigning the Falklands dispute to the backburner. It is, to put it mildly, a sharp departure from traditional national policy regarding the Malvinas.
Of course, the UK is a strategic member of NATO, to which Milei’s government has applied to join. Plus, Israel is one of the two countries that Milei has most firmly aligned Argentina with since becoming president, the other being the US. As such, as the Argentina journalist Luis Bruschtein recently noted, “Argentina’s claims of sovereignty over the islands have become an obstacle that must be quietly removed from its foreign policy agenda.”
Another Tough Guy Patriot
Milei continues to present himself as a tough guy patriot by holding military processions to honour the veterans and fallen soldiers of the Falklands War. During the recent Independence Day celebrations, he climbed into a tank alongside his vice president, Victoria Villarruel. The daughter of a former high-ranking member of Argentina’s armed forces who refused to pledge loyalty to the constitution of Argentina’s new democratic system in 1987, Villarruel has made a name for herself by challenging the decades-long consensus over Argentina’s dictatorship as well as questioning the number of victims, dead and disappeared it left in its wake.
At the same time as Milei glorifies the veterans and fallen soldiers of the Falklands War while exalting the military and calling for an era of reconciliation with, and strengthening of, the armed forces (to help out in Ukraine?), he has firmly aligned his government with the three countries that always vote against Argentine claims to the Malvinas — the UK, Israel and the United States. It is an audacious bait and switch that is already having repercussions for Argentina’s claims over the Malvinas, notes Bruschtein:
[B]y breaking Argentina’s traditional position in support of international peace, the government’s decision to embroil Argentina in two international wars (Ukraine and Israel/Palestine) have severely weakened its diplomatic strategy for the Malvinas…
At the last meeting of the UN Decolonization Council — the C-24 — where support for the Argentine position has always been one of total unanimity, the government encountered more than one obstacle. The Arab countries, angered by Milei’s decision to move the Argentine embassy in Israel from Tel Aviv to Jerusalem, and the Caribbean CARYCOM invited the kelpers to present their case to the commission. Some representatives were hesitant to repeat their vote for Argentina and the session was on the verge of going to a vote. Finally, the resolution passed like every year, but, since Milei took office, the lack of energy and policies to support the Argentine claim for the Malvinas has weakened the country’s position and put its claim to the Malvinas in the balance.
For all of its many faults, the former Albert Fernández government did at least express its firm opposition to the exploration work being carrying out by Navitas Petroleum in the disputed waters surrounding the Malvinas. In September last year, Argentina’s Foreign Ministry filed a complaint against the Israeli company, recalling that it had already sanctioned the firm with a 20-year ban on hydrocarbon exploration activities in Argentine territory — not that the company seems to care.
By contrast, as the UK government and Navitas Petroleum prepare to begin drilling in the disputed waters off the Falkland Islands, the silence of the Milei government is deafening. The Venezuelan President Nicolás Maduro hit the nail on the head during Venezuela’s Independence Day celebrations just over a week ago, saying that the first thing Milei did upon coming to power was to recognise British sovereignty over the Malvinas. In return for what? A US Southern Command military base in Patagonia.
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Argentina has no better historical claim to the Falklands than Britain (at one point in the early 19th century, the US landed and dissolved the government – an early instance of the rules based order, perhaps?). Based on UN principles of self-determination of peoples, Argentina has no valid current claim to the Falklands. There have been two hundred years of British settlement and an overwhelming majority of the current population favours remaining British.
Obviously, there were arguable war crimes in the Falklands campaign, on both sides. However, given the above, the article seems to be looking for a geopolitical wrong where there is none. The status of Argentina itself, which was populated by indigenous people, is more contestable than the Falklands, which were unpopulated at the date of European settlement.
Just because there are notorious bad actors involved (UK, USA, Israel) shouldn’t colour the conclusions.
Yes, with some territorial claims there really isn’t much in the way of rights or wrongs – its just legal ambiguity and people pick their sides according to who they prefer. The Falklands seems unusual in that there was no pre-European indigenous population (unlike the disputed area between Guyana and Venezuela, which is mostly populated by ethnically pre-colonial peoples who for obvious reasons don’t seem to much like the Venezuelans, Guyanese or British, not that many of the players has bothered to ask them), so really it should be up to the locals in the Falklands, most of whom can trace their ancestry back several generations. If there were more of them, no doubt they’d be interested in independence now that they have oil. There are less than 4,000 Falklanders, so it wouldn’t take a big discovery to make them all millionaires.
The oil licensing issue there is more complicated. The UK recognised its potential for oil back in the early 1990’s. Theoretically, all oil is ‘owned’ by the Falklands government, but in reality they will just get a small chunk of the royalties (I don’t know the exact details). The oil reserves there are somewhat unusual along the east Atlantic regions of South America (these reserves are all geologically connected, a result of the early creation of the Atlantic as Godwandaland split), in that its in relatively shallow water – around 500 metres deep – this makes it more economically viable than other notionally much larger fields. It is claimed to have a break even cost for extraction for under $30 a barrel, which is unusually low for off-shore (about half that for many US tight oil plays). As the current owners of the licence bought it off the exploratory company, this is a real reserve, not the unicorn that lots of alleged fields represent (there are multiple good reasons why exploratory companies will hype the viability of any find). Navitas seems to be quite a big player in oil production in the US, especially the Gulf, so presumably they see the possibility of linking it in with their existing production know-how.
There are two other potentially big fields around the Falklands, so if Milius is giving way on this, it would raise a lot of interest from other exploration companies. I’m genuinely surprised that Argentina never pushed the issue of the UK’s 200 mile oil zone around the islands (which is a lot more legally dubious than its claim on the islands itself) – exploration would be impossible if there was a military threat. I assume this is all down to the general chaos of Argentinian politics.
Nothing makes me lose respect for Latin American elites more than this weird obsession with the Falkland (not Malvinas per their actual inhabitants) Islands.
It is based a little in geostrategic considerations and a lot in a deep sense of Hispanic ethnic supremacy.
Their main victims have always been the indigenous people, the secondary victims have been Black people, but as we all know they will happily turn their ethnic hate canons toward us when the opportunity arises–not our governments, us, including a few thousand of us living on some forsaken islands in the Atlantic.
Exactly the same could be said of the UK.
Can you further enlighten me on that I am not joking, I believed the islands were an Imperialist outpost planted with pro British citizens and held by way of the might of the British empire.
The best thing about UN principles is that you can pick and chose which ones and when to apply, as long as you have the bigger gun(boat). It’s like the rule based order, but under much better name.
The UK government bringing in Israeli companies to explot (steal) the natural resources of the Falklands (in the past I would always insist on calling them the Malvinas, but if the Argentinians themselves don’t care about them, why should I?) couldn’t be a better expression of what the Argentinian people voted for. Time (again) to reap what you’ve sown. It won’t be the last time either.
I think that characterising it as the UK bringing in an Israeli company is not really accurate. Its the Falklands Government (obviously under strong London guidance) which issues the exploratory and extraction licences. Once issued, this licence is the property of the purchaser, and they can sell it to whomever they want within the terms of the licence.
Navitas simply bought the rights off the exploratory company that originally won the licence at auction. This is very much the norm in the off-shore oil and gas world. The only exception is usually where there is a State oil company, and even then its often done on some plays in order to encourage risk hedging.
Navitas itself seems to be predominantly a US company (its production plays seem to be mostly in the Gulf of Mexico), but it is registered on the Tel Aviv stock exchange.
The big unknown in all this is whether there is some sort of backdoor deal with Argentina over the oil – clearly the big financial risk to a licence holder is a future Argentinian government deciding to challenge the legitimacy of Falkland Government licences by force. So that risk is either priced in, or someone knows something.
There’s that Brexit Dividend!
We may not have as much trade with the EU. We didn’t get any of the trade deals that were promised. Our economy is held together by string and sticky tape.
But lo, let us drill, together with our genocidal friends and with the blessing of Argentina’s Thatcher fanboy. Let us harvest the environment-destroying black gold.
Then Britain will be great again!
500 million barrels – woohoo. That is a whole 5 days of world consumption!
Wondering what inhabitants I had a look at Wikipedia’s timeline. I turns out there where 25 Argentines who had settled there in 1828 and a garrison of unknown size posted there in 1832. Both protested by Britain.
I thought this was a fun incident:
… and following the link to Antonio Rivero one discovers that only the garrison was evicted, though the settlement was reduced by 12 soon after through murder and arrest.
The exceptionally low number of inhabitants on the islands when the British invaded in 1833 may have had something to do with the fact that: a) Argentina had only taken possession of the islands in 1820; and b) in 1831, a US expedition invaded the islands, which were by then home to a penal colony, and sacked the settlements built there. That was just two years before the British themselves invaded (prior to Argentina’s takeover, the Falklands were being exploited by whalers, primarily from the US and the UK). From Wikipedia’s Spanish language page (machine translated):
Britain and Spain had been squabbling over the islands for more than a century before Argentina was even a thing. Britain only ‘invaded’ when Argentina garrisoned them, and they didn’t evict the inhabitants.
The English version of the Lexington story has a slightly different slant:
What a fascinating rabbit hole you’ve sent me down. This page fills out the picture beautifully.
Key points: Vernet sought, and received, permission from the British to start his colony. Once he had succeeded (third time lucky!) Argentina declared sovereignty, made him Governor and (the motive for the whole scheme, I hazard) gave him a monopoly on seal hunting. Trying to enforce it is what caused the trouble with the Americans.
Weirdly, even after this chicanery the British tried to get him to go back to sort the place out.
No, Vernet’s original business plan was to exploit the feral cattle on the island. This had mixed results and it was only once he was on the island that the seal opportunity presented itself.