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The Argentine Gov’t Will Hunt You Down for Exploiting the Malvinas’ Natural Resources

By | [email protected] | December 11, 2013 4:54pm


The seemingly insurmountable sovereignty dispute over the Malvinas/Falklands islands took an interesting turn two weeks ago after the Lower House passed an amendment to Law 26.659 to penalize any activity of exploration and exploitation of hydrocarbons in the country’s territorial sea and continental shelf (where the islands are located, according to Argentina) without the approval of the National Government.

Although not really applicable unless those involved tried to enter actual Argentine territory, the piece of legislation warns of prison sentences of up to 15 years; fines up to an equivalent to the value of 1.5 million barrels of oil; the banning of individuals and companies from operating in Argentina; and the confiscation of equipment and any hydrocarbons that would have been illegally extracted”.

Meaning: You mess with my islands, I’ll mess with your money.

This could pretty easily become one of those impeccably elaborated measures to create nothing but bombastic headlines on each side of the pond that appeal to rotten patriotism in order take the citizens’ minds off local affairs and increase the government’s popularity. Still, this is an unprecedented, aggressively proactive measure taken by Argentina outside the boundaries of the United Nations scenario.

For the first time, they are going for the big bucks.

In an international playground that has sensibly evolved to the point were armed disputes between western countries aren’t an option but neither are peaceful compromises between those who are financially unequal, here is why the business world can be the area in which we could – unexpectedly – see our country move forward in the right direction.


The conflict over the islands is pretty much a real life version of the Choose Your Own Adventure books. The conflict over the Malvinas/Falklands Islands has been framed by the United Nations as an ongoing sovereignty dispute that should be solved through peaceful discussions between the two parties who are claiming ownership over the same piece of land.

Argentina, perhaps for a lack of better resources, has understandably stuck to the mandate of the United Nations and asked England to resume negotiations. Simultaneously, the UK has opted for an alternate route and has defended the right to self-determination of the islands’ population, who just happen to want to keep on being an overseas territory of the UK, as stated recently in a local referendum.

After this referendum took place, Argentina decided to reject its validity, since the population of the islands mostly descends from the Scottish and Welsh immigrants who settled there in 1833 and have been officially British citizens since 1983.

As you might now, there was also a war in 1982 over the islands, and while the British usually argue that they won (so the case is closed,) Argentina argues that the war can’t be factored in, since it was set up by a disgraced Margaret Thatcher in desperate need of a popularity boost and an Argentine drunken military dictator who needed to keep the public eye out of the fact that he had risen to power through a military coup. And also that Argentina was altogether going to hell.

So there you have it, hundreds of years of history summarized for you. You’re welcome. Now let’s get to business.


When it comes to making the world function properly in a democratic (or non-democratic) manner, IT IS ALL. ABOUT. THE MONEY. Western countries historically decided to stop warring with each other mainly because a stable, predictable and business-friendly scenario was substantially more profitable (yes, war is also profitable but we’ll cover that some other day.) World organizations like the United Nations provide a political framework that has only been entirely successful when it’s in sync with the big “global market.” *wink*

The UN has repeatedly released resolutions that urge in more ways than one for the UK and Argentina to find a way to solve this conflict. Even more so, both countries have managed to find allies that support each side of the dispute. Thanks to my previous cynical statement about the world, you should know by now that allied countries have mainly chosen sides based on economical and geopolitical stances. I know; shocker, right?

More specifically, Resolution 31/49 of the United Nations General Assembly requires the UK and Argentina to refrain from making unilateral decisions regarding the islands’ territory (such as oil drilling around the islands) while the sovereignty dispute is still pending.

And yet, nothing has happened.

In decades.

Enter here: Argentina’s decision to fuck with oil money and the world of finance. The strategy is pretty simple: Argentina will penalize any oil company that carries out any activity of exploration and exploitation of hydrocarbons on the islands, not only with penalties of up to 15 years in prison but also by banning individuals and companies from operating in Argentina.

This is definitely a bit risqué, but in a time when the Government is being somewhat permissive with companies that could potentially develop the oil industry here (and based on the assumption that the main rule in the business world is that NO COMPANY will make a decision that affects its ability to make money,) this is maybe a smart move.


It only took two nanoseconds for the UK to reject Argentina’s new legislation. In their heads, the argument understandably makes sense: the islanders have the right to develop their natural resources for their own economic benefit and under their own laws.

Even if we were to naively assume that oil drilling is more beneficial for the local population than for oil conglomerates, hydrocarbon activities on the islands have been recently put in the spotlight by British news outlets who argue that an oil spill in the area could be almost three times as big  as the oil spill that took place in the Gulf of Mexico a few years ago, and could potentially reach Argentina’s coast in less than fifteen days, creating a terrible environmental disaster.

Argentina would make use of such a calamity before the UN to prove that it had a point. It is also estimated that since any contingency plan set out for a potential oil spill would take into account the enormous distance between the islands and the UK, the cost for insurance companies would be almost impossible to calculate.

See? No need to play the environmental card here. Scaring away insurance companies can do wonders to keep any adventurous hydrocarbon exploration away from the islands.


The potential effect (if any) that such a measure could have over any hydrocarbon exploration around the islands is not clear, but it is safe to say that when it comes to the bilateral dispute, Argentina could be for once really getting the gist of the conflict. More specifically, the National Government seems to be finally understanding that this is all about natural resources, and that this could have repercussions on the dispute.

It is unclear whether Argentina will manage to propel the UK to take a seat at the UN and get it to talk sovereignty. Chances are it won’t even get to that point, mainly because, in the food chain of world powers, the scale tips largely in favor of the UK.

But that’s never been an obstacle for Argentina when it comes to making some noise. So let the catfight financial disputes begin.

Don’t fret, if it gets too embarrassingly greedy, the average voter will be there to remind you that this is all about patriotism.

(Photo via Falkland News)