Argentina takes aim at Falklands oil companies

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By DEBORA REY, Associated Press

BUENOS AIRES, Argentina (AP) — Argentina is intensifying its campaign to block oil development in the Falkland Islands, announcing on Thursday it will pursue "administrative, civil and criminal" penalties against the dozens of companies involved.

Foreign Minister Hector Timerman said "the resources of the South Atlantic are the property of all the Argentines," and that includes any oil found off the shores of the islands they call the Malvinas, which have been controlled by Britain since 1833.

Once the colonial subjects of Britain, the roughly 3,000 islanders now determine their own fate. Already, they have collected millions of dollars in licensing fees for oil exploration.

Rockhopper Exploration plc, the only company so far to strike oil, has been seeking a $2 billion investor to fund crude production from last year's Sea Lion discovery, but has yet to announce a deep-pocketed partner. If and when that deal is done, it will take about four years before crude production begins and billions in royalties begin flowing into the Falkland Islands treasury.

Argentina, which lost a brief and bloody war against Britain for the islands in 1982, indicated it aims to keep production from happening by any means possible short of violence or war. Timerman insisted that the Argentina government now comes in peace and will always follow the limits of international law.

Many financial documents dealing with oil in the islands already note the risks of drilling in territory also claimed by Argentina, but Timerman said Argentina will go to industry regulators in New York and London to make sure such warnings appear in any required filings.

"We won't let one day pass in the courts without defending our resources," Timerman said.

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