BUENOS AIRES/LONDON, Sept 3 (Reuters) - Argentine President Javier Milei said he would sanction oil companies drilling in the Falkland Islands, the British overseas territory claimed by Argentina, in a move which could escalate tensions with London.
Milei's comments in a televised national address on Thursday came days after U.S. President Donald Trump said he was reviewing the United States' neutral position on the remote archipelago in the South Atlantic.
The prospect of two oil firms carrying out exploration in the islands, which Argentina calls Las Malvinas, was an urgent threat to Argentine interests, Milei said, 44 years after his country was defeated by Britain in a war over the islands.
Milei said he was sending Congress a bill aimed at strengthening Argentina's response to what he called violations of its sovereignty.
BRITISH COMMITMENT 'UNSHAKEABLE'
Britain, which has controlled the islands since 1833, has said that Falkland islanders should determine their own future. British defence minister Wes Streeting said on Friday that the people living there had chosen to be British.
"Milei’s statement overnight tells us more about domestic politics in Argentina than it does about the Falkland Islands," Streeting said on X. "Our commitment to the Falklands is absolute and unshakeable."
Milei has previously favoured diplomacy as the best way to pursue Argentina's claim to the Falklands, but in striking a tougher tone he has perhaps been emboldened by his ally Trump's repeated broaching of the issue.
Trump told GB News on Thursday that he was not sure if Britain would be prepared to fight for the islands again.
"I just don't know if you (Britain) have the capacity to do that," Trump said. "The Falklands is very interesting because your country is not the same country it was 20 years ago, 25 years ago."
Britain's then-Prime Minister Margaret Thatcher sent a naval task force to the South Atlantic following an Argentinian invasion in April 1982. It regained control of the islands after 74 days of fighting.
A potential shift in the U.S. position towards the Falklands was included among a range of options considered by the Pentagon earlier this year to pressure NATO allies it believes failed to support U.S. military operations in the war with Iran.
SEA LION OILFIELD
Seeking to ratchet up its sovereignty claims, Milei said he would send Congress an urgent "national sovereignty defence" bill to toughen penalties for unauthorized operations around the islands, extend sanctions to suppliers and broaden the legal framework to cover other activities affecting Argentina's natural resources.
The Sea Lion project, which lies about 140 miles north of the Falkland Islands, is operated by Tel Aviv-listed Navitas Petroleum and also has London-listed Rockhopper Exploration among its shareholders with a 35% interest.
Development work could begin on it in the coming months.
Rockhopper stock was down 8% on Friday morning.
Rockhopper says the Sea Lion project has a world-scale resource base amounting to 1.7 billion barrels of oil. That amount would be enough to meet global oil demand for 17 days.
The two firms did not immediately respond to requests for comment following Milei's address.
Milei said Argentina would boost efforts to levy penalties not only against the companies involved, but also against their shareholders, directors and suppliers.
(Reporting by Nicolas Misculin and Kylie Madry and Sarah Young in London; Editing by Jacqueline Wong and Alex Richardson)
