The process of sanctions against oil companies that illegally explore on the Continental Shelf and the Malvinas began

The Secretaries of Malvinas, Antarctica and South Atlantic, Daniel Filmus, and Energy, Darío Martínez, announced the start of the process of disqualification and sanction of oil companies due to the performance of commercial activities related to the exploration of hydrocarbons on the Argentine continental shelf , in the North Malvinas Basin, with illegal licenses granted by the illegitimate authorities of the Malvinas Islands.

The procedure, framed in law 26,659, is aimed at the oil companies “Chrysaor Holdings Limited” and “Harbour Energy Plc.”, based in the United Kingdom, and “Navitas Petroleum LP”, based in Israel, as a result of the execution of commercial activities related to the exploration of hydrocarbons in the context of "Sea Lion" project without permission from the Argentine authorities.

Law 26,659 establishes the conditions for the exploration and exploitation of hydrocarbons on the Argentine continental shelf, among which is the obligation to obtain permits prior to carrying out said activities, and penalties for non-compliance with the disqualification from carrying out said activities for a period ranging from 5 to 20 years, among other penalties.

Likewise, the aforementioned law prohibits "Having direct or indirect participation in legal entities, national or foreign, that carry out hydrocarbon activities in the Argentine Continental Shelf without having obtained the pertinent authorization issued by the competent Argentine authority, or that provide services for said developments"

Filmus highlighted that "Hydrocarbon laws 26,659 of 2011, and its amendment, Law 26,915 of 2013, are binding on the prohibition of exploring or exploiting hydrocarbons on the Argentine continental shelf without authorization from the Argentine government."

“This action Argentina is taking is supported by a number of statements from various multilateral organizations: the Latin American Energy Organization (OLADE), the G77 + China, CELAC, Mercosur, the Ibero-American Summit, which met a little more than a month ago”.

“All of them have defended United Nations Resolution 2065, that provides for direct bilateral negotiation as a way to find a final and peaceful resolution of the dispute with the United Kingdom on sovereignty over the Malvinas and have also supported Argentina's right to initiate the actions that we announce today, as a result of the violations of United Nations Resolution 3149, which states that neither party can take any kind of unilateral action without the authorization of the other, ”the Foreign Ministry official also stressed.

“In addition, there have been several accidents that, for now, had no consequences. There is an enormous environmental risk of an accident with consequences that can reach Antarctica”, said the Secretary of the Malvinas, Antarctica and South Atlantic, during the virtual press conference offered on July 7 from the Foreign Ministry and in which also participated the National Director of Malvinas, Sandra Pitta.

The Secretary of Energy, Darío Martínez, assured that “we have done a joint work with the Malvinas Secretariat of the Foreign Ministry based on these irregularities we have detected. The law is very clear in this regard and these companies are not authorized to operate, nor have they requested any type of authorization. That is why we started this process related to the notification and then with the sanctions, as allowed by the regulations.“

It is important to defend energy sovereignty and in this sense the Ministry of Energy provides technical knowledge and records based on the need for a process that the Ministry of Foreign Affairs will then continue with our support. In this matter there is no discussion: Argentine men and women deserve that we take care of our sovereignty ”, also expressed the Secretary of Energy.

In 2020, the Chrysaor Holdings Limited company reached a merger agreement with Premier Oil PLC, which was disqualified in 2013 for being the holder of licenses granted by the illegitimate island government, giving rise to “Harbor Energy Plc” company. Also last year, Rockhopper Exploration, the oil and gas exploration and production company with key interests in the North Malvinas Basin (disqualified in 2013), announced that Rockhopper and Premier Oil Exploration and Production Limited (“Premier”) signed an Agreement with Navitas Petroleum to obtain a 30% interest in the Sea Lion project.

During the past year, the national government sent notes of discouragement to Navitas and Chrysaor companies, in which they were reminded, on the one hand, that the Malvinas Islands, South Georgias and South Sandwich Islands and the surrounding maritime areas are an integral part of the Argentine national territory; and, on the other hand, they were informed of the provisions established in national laws 26,659 and 26,915 regarding the performance of activities without the corresponding authorization of the competent authorities, inviting them to refrain from financing or participating in any other way in the referred activities, becoming liable, otherwise, of the corresponding administrative and judicial legal actions by virtue of the applicable Argentine regulations.

Regarding the procedure, once the aforementioned administrative actions have been initiated, the notification to said companies through the Ministry of Foreign Affairs will continue, giving them a deadline to present eventual discharges in exercise of their right of defense. In case of not appearing, the process will continue its course, having to adopt the sanctions that the Ministry of Energy deems appropriate, including the disqualification. They will be final once a new notification has been sent to each of said companies and the deadline for eventual appeals has elapsed.

In the same vein as the actions announced today, the National Congress passed Law 27,557 last year on the Demarcation of the Outer Limit of the Continental Shelf with the aim of consolidating sovereign rights over the resources of the seabed and subsoil.

These actions give continuity to the legal action plan initiated by the national government in 2012 to protect the natural resources under its sovereignty and reject the illegitimate hydrocarbon activities on the Argentine continental shelf. In 2012, five companies that carried out activities related to illegal exploration on the disputed continental shelf were disqualified and in 2015 the activities of two more companies were declared illegal.

Likewise, in 2015, the Ministry of Foreign Affairs and the Federal Ministry of Planning promoted the criminal complaint of different foreign companies that carried out illegal activities of exploration, search and eventual extraction of hydrocarbons in the Atlantic Ocean, in the vicinity of the Malvinas Islands without authorization, concession, or any permission granted by the competent Argentine authority, in violation of the criminal offenses contained in art. 7 of Law 26,659, amended by Law 26,915. At the same time, these maneuvers can significantly affect both the natural resources that belong to the patrimony of the National State, as well as the environment, circumstances regulated in the provisions of Laws 25,675 and 24,051 (General Law of the Environment and Hazardous Waste).

As a result of the policy followed, none of the global oil companies based in our country will participate in activities in disputed areas. In addition, in response to the efforts made, several companies in the sector stated that they had no interest in participating while the dispute persisted (British Petroleum, the Indian state oil company ONGC, Talisman Energy, Fugro-Geoteam AS and Anadarko). The actions of our country have thus contributed to hinder the illegal activities carried out by companies such as Argos in the areas bordering the Malvinas Islands, which today is exposed to problems from a financial point of view, without tangible results in terms of exploration even after several years of existence.


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