Malvern oil firm in Falklands row

MIDLAND-BASED oil exploration company Desire Petroleum was at the centre of an international row today over its work in the South Atlantic.

The Malvern registered company is carrying out a drilling project in the Falkland Islands and it has said the work will go ahead despite warnings by Argentina that it maintains sovereignty in the area.

Argentina has said that boats sailing from its ports to the Falklands will need a government permit, stoking up a long-running dispute over exploration rights.

Desire (DES) said the move would not affect its drilling programme.

“This whole situation has unfortunately been anticipated for months. Desire’s logistics are unaffected,” said a spokesman.

Earlier this month Falkland Oil and Gas Ltd announced that it had reached an agreement with Desire to contract the Ocean Guardian rig to drill the first ever exploration well in the East Falklands Basin on the Toroa prospect.

The work is expected to go ahead – diplomatic sabre-rattling permitting – in the first half of this year.

Tim Bushell, chief executive of FOGL, said: “We are delighted to have secured the Ocean Guardian for the drilling of our first ever exploration well, which will be a significant milestone for the company.”

Analysts believe that despite the political backdrop, Desire should be able to work unimpeded.

The Argentinan authorities had complained to Britain earlier this month over the drilling plans, re-igniting concerns over the sovereignty of the Falkland Islands.

Security experts have said that if the situation escalates then companies could bypass Argentina and use friendly ports in Brazil instead.