September 27, 1995. Copyright, 1995, Graphic News. All rights reserved

OIL EXPLORATION OFF THE FALKLANDS
by Nicholas Booth

LONDON, September  27, Graphic News - In New York today (Wednesday), the foreign ministers of Great Britain and Argentina are due to sign a draft agreement over exploration rights for an area west of the Falkland Islands. Argentina will be allowed to participate in joint ventures around the islands and the agreement is widely seen as the first step in normalising relations between the two countries since the conflict in 1982.
       The Falkland Islands government would not reveal the exact details of todayÕs draft but acknowledged that the rights concerned not just oil exploration. The draft covers two geographical areas:  the first is west of the Falklands (and understandably the most contentious) whilst the second concerns waters over which sovereignty is not disputed. Both sides have taken care to emphasise the joint benefits to be gained from this cooperation.
       Nevertheless politics promises to overshadow the signing of the agreement. Diplomats acknowledge that the meetings to discuss the draft agreement over the previous year have been, at times, acrimonious. Argentinean veterans of the Falklands War have protested and are calling for a boycott of the oil companies to whom rights will be assigned. Argentine foreign minister Guido di Tella has already suggested that the agreement marks a significant step on the road to his countryÕs return to exercising sovereignty over the islands, echoing President MenemÕs statement that they will be won back by the year 2000.
        In response, the British Foreign Office has announced that there is no question of surrender of sovereignty. Though it acknowledges that there will be some benefit to the Argentineans, the UK government is insistent that Argentina will gain no royalties from exploitation of disputed waters. A joint commission will be in charge of oil rights in the areas furthest away from the islands and revenue will be split and shared equally between the two governments. Argentina is also being encouraged to provide major logistical support on the mainland for prospective oil companies.
       On October 3rd, the Falklands IslandsÕ government will announce the winners of licensing deals for ÔblocsÕ of oil fields within its waters which are completely separate from todayÕs talks. Also next month, the prime ministers of both Britain and Argentina are expected to meet at celebrations of the United NationsÕ fiftieth anniversary in New York and ratify the agreement. It will be the first meeting of the respective heads of government since the war in 1982.

Sources: The Financial Times, Falkland Islands Government