Falklands Oil Reopens Old Wounds

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Diamond Offshore drilling / AP

The Ocean Guardian, a semi-submersible oil drilling rig, under tow in British coastal waters.

Argentines could be said to share three passions: soccer, the tango and their longstanding claim over Las Malvinas, which the British who control the island archipelago 300 miles off Argentina's coast call the Falklands. Even though Britain decisively beat back an Argentine invasion of the Falklands in 1982, the cry of "Las Malvinas son Argentinas!" (The Malvinas are Argentine!) still resonates in national politics. "It doesn't matter if you're from the left or the right, when you become President in Argentina, sooner or later you start beating your chest about the Malvinas," says writer Sylvia Walger, who is set to publish a book on current President Cristina Fernandez.

That time has now come for Fernandez, who has begun vigorously asserting Argentina's rights to the Falklands after a British oil rig recently arrived to explore what may be vast crude reserves beneath the sea bed around the islands. Last month, Fernandez vowed to argue "one thousand and one times for [Argentina's] international rights" to the islands and the oil, and ordered all ships stopping at Argentine ports obtain a special government permit if they want to continue on to the Falklands. This month, during a visit by U.S. Secretary of State Hillary Clinton, she requested Washington's mediation in the dispute — and while Clinton declined to mediate, she appeared to endorse the principle that the dispute ought to be up for negotiation. "We would like to see Argentina and Great Britain sitting down to discuss this issue," she said.

The prospect of striking oil has made the issue more urgent. No one knows how much crude the North Falkland Basin holds. The last exploration there, undertaken in 1998, was encouraging, but not enough to compel oil companies to start drilling. That, of course, was when oil was selling for $10 a barrel; today it's $75. For Argentines such as Rafael Bielsa, foreign minister to Fernandez's husband and predecessor, former President Nestor Kirchner, the Falklands could now be "a southern Persian Gulf" holding at least 6.5 billion barrels of oil. "That," says Bielsa, "works out at nearly $35 million for each inhabitant of the islands," a self-governing territory of the United Kingdom slightly smaller than the state of Connecticut.

But those 3,000 Falklands residents are the strongest opponents of any rapprochement with Argentina, a fact many Argentines routinely overlook. "The Malvinas [for us] are a delusion," says Argentine historian Jorge Lanata, who has filmed documentaries on the islands. "When you are over there, you realize it is a British state — the inhabitants almost overact their Britishness."

Still, Las Malvinas are a matter of wounded national pride, not so much because of the 1982 Falklands War — universally dismissed as the last lunatic act of a military dictatorship that collapsed a year later — but over the original British takeover of the islands in 1833. Most Argentines consider that occupation a violation of their country's sovereignty over Las Malvinas, which dates back to its national independence in 1816, when it inherited them from Spain. Britain, however, has long insisted that the presence of British settlers there before 1816 justified its action.

To distance themselves from the murderous dictators who invaded the islands in 1982, democratic Argentine governments since 1983 have usually put the Falklands issue on the back burner (though the Constitution was amended in 1994 to make the islands' "recovery" one of the nation's "permanent objectives"). That's changing now: posters clamoring for Argentina's rights to Las Malvinas are popping up around the capital, Buenos Aires, and even the use of "the Falklands" as a name for the islands constitutes treason in the minds of many Argentines, who are furious at the thought of being excluded from a potential oil boom on territory they consider their own. "What are the British going to do, pump oil out of South America and ship it to Europe instead of that wealth staying [here] where it belongs?" says Buenos Aires taxi driver Antonio Jurado, 52. "Those days of colonialism are long over."

As a result, taking a hard line makes political sense for the embattled Fernandez as well as for Kirchner, now the congressional leader of their Peronist party. That's especially true since the left-leaning couple hail from the southern Patagonia region, closest to the Falklands. Even so, leading Argentine political analyst Rosendo Fraga warns that Fernandez's permit order is "a double-edged weapon. If Argentina's Navy tries to enforce the decree, they run the risk of militarizing the conflict. If they don't, they look like they are accepting Britain's clam over that oil."

The arrival of the British oil rig has also galvanized support among other Latin American nations. During a summit in Mexico last month, the region's heads of state signed a declaration backing Argentina's sovereignty over the Falklands. Brazilian President Luiz Inacio Lula da Silva called on the U.N. to take up the matter — wondering aloud if it hadn't done so "because England is a [permanent] member of the Security Council." Argentine Foreign Minister Jorge Taiana flew directly from Mexico to New York to ask U.N. Secretary General Ban Ki-moon to help stop Britain from moving ahead with drilling.

London insists the Falklands have a "legitimate right" to develop their own oil industry. Britain's Permanent Representative to the U.N., Sir Mark Lyall Grant, said the country has "no doubt" about its sovereignty over the islands. (One Conservative member of the committee on the Falklands in Britain's Parliament called Fernandez's decree "pathetic and useless.") And few Argentines expect the U.S. to lean on their U.K. allies. The Buenos Aires daily Clarin, a strong Fernandez critic, dismissed Clinton's words as a mere "gesture of good will" that doesn't signify any real U.S. policy change. Then again, Washington did try to mediate in the days before the 1982 war, when then Secretary of State Alexander Haig shuttled between meetings in London and Buenos Aires.

Either way, what Argentines probably need more than diplomatic clout or superior firepower is patience. Whether Argentina has to wait "forty or four hundred years" to regain Las Malvinas, says Bielsa, "will depend on how clever and perseverant we are." They've waited 177 years so far, but the prospects of an oil find worth billions looks set to try their patience.