Argentina beefs up military for Falklands

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BUENOS AIRES, Sept. 15 (UPI) -- Argentina is beefing up its military in preparation for oil exploration in the Falklands basin concurrent with British-backed prospecting for hydrocarbons in the region nearer the islands.

Aides to President Cristina Fernandez de Kirchner said Argentine prospecting for hydrocarbons would begin in December -- a little more than a year after British companies started drilling for oil amid an international outcry from Buenos Aires, which contests British sovereignty over the Falklands, a British Overseas Territory.

Argentina invaded the Falklands in 1982 but was repulsed by Britain. The 74-day conflict cost more than 1,000 lives and led to a formal Argentine surrender that didn't prevent Argentina from reviving the sovereignty claim last year.

Analysts said Argentine plans for oil exploration in the South Atlantic waters could be interpreted in Argentina, Britain and the Falklands as an escalation because of continuing oil exploration by U.K.-listed companies licensed by the Falkland Islands government.

Argentina has leased a semi-submersible rig from Swedish company Stensa that will be used for exploratory drilling in an area described by officials in Buenos Aires as halfway between the Falkland Islands and Tierra del Fuego, an Argentine archipelago off the southernmost tip of the South American mainland, across the Strait of Magellan.

A consortium put together for the prospecting offers a flavor of the current oil politics of the Falklands, as it includes YPF-Repsol, a Spanish oil and gas company with operations in 29 countries but major assets in Argentina, Argentina's Pan American Energy and Brazil's Petrobras.

Industry sources said when implemented the oil drilling operation would be the southern-most oil exploratory operation in Argentina's history.

The initiative was interpreted by industry analysts as Argentina's answer to the exploratory round in the Falklands' waters from the British side and a follow-up to Argentina's claims of sovereignty over the area.

As retaliation against British drilling in the Falklands Basin, Argentina announced punitive sanctions against vessels bound for the islands but shipping industry sources argued the measures could hurt Argentina more than the Falklands.

Britain has rejected Argentine claims the Falklands or the waters are disputed territory.

Five U.K.-listed companies have drilled or announced plans to drill in Falklands' waters.

Before Argentine naval reinforcements in the area, Britain also built up its naval presence in the South Atlantic region, explaining its action as a routine exercise.

Argentina has justified its military reinforcements as part of an overall national strategy that sees the South Atlantic as Argentina's "soft belly." But Buenos Aires' pronouncements of British "neo-colonialism" and "occupation" of the Falklands have led to London viewing developments as an unwanted military escalation.