Venezuela to aid Argentina drill for oil near Falklands

Aug. 7, 2012 at 7:02 AM
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CARACAS, Venezuela, Aug. 7 (UPI) -- Venezuela is helping Argentina drill in the South Atlantic waters close to the British-ruled Falkland Islands as Buenos Aires drums up Latin American support for its claim on the territories.

Argentina invaded the islands in 1982 but was repulsed by Britain. The 74-day war left about 904 military personnel and three civilian Falklanders dead but didn't end the territorial dispute.

Argentina plans to explore for oil near Falklands territorial waters as a challenge to the British-led campaign to find hydrocarbon resources. Most results of the deep-sea drilling have been disappointing, however.

Argentina mounted action against Falklands-bound shipping and took its territorial claim to international forums.

Support for the Argentine claim on the Falklands has figured at regional gatherings but hasn't drawn the kind of support that Argentine President Cristina Fernandez de Kirchner hopes to receive from Venezuelan President Hugo Chavez.

Chavez, sees the Falklands dispute as an opportunity to build pressure on countries, including Britain and the United States, he regards as skeptical of his Bolivarian revolution -- a mixture of populism and socialism.

Argentina is seeking to pump life into former Spanish-controlled YPF energy company after it nationalized the entity in a dispute with Spanish owner Repsol.

Repsol's warnings of retaliation against companies that collaborate with Argentina in the process of YPF confiscation have kept international investors from the nationalized firm.

Chavez ordered Venezuela's state oil company PDVSA to collaborate with YPF.

Senior Venezuelan oil executives confirmed they had received the instructions to help YPF, ignoring criticism that the country's own oil industry sector needed careful strategies for reversing stagnation caused by waves of nationalization.

PDVSA President Rafael Ramirez Carreno said the company would help YPF explore for hydrocarbons in the South Atlantic waters next to the Falklands.

"We talked about the need to explore for oil and gas in the Argentine territory and also offshore, in the areas next to the Malvinas Islands, but first we must analyze costs and timing," said Carreno in an interview with Pagina 12 newspaper.

Malvinas is Argentina's term for the Falkland Islands.

Of several offshore exploration programs, only one mounted by Rockhopper Exploration, a London-listed company, has reported good prospects for commercial quantity oil exploration.

Rockhopper Exploration and UK Premier oil recently announced a $1 billion partnership to develop hydrocarbons in the Sea Lion prospect, an offshore drilled region.

Venezuela has promised to be generous with energy technology transfer to Argentina.

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