Last month I explained a possible (stress possible, if not probable) scenario for future conflict in the Falkland Islands. The upgrading today of original exploration forecasts by Rockhopper has not made this scenario any more probable but it has increased the stakes.
Initial estimates suggested that recoverable reserves in the North Falkland Basin totalled 170 million barrels of oil. The new forecast of 242 million barrels prompted Rockhopper’s share price to shoot up more than 50 per cent early on this morning. Shares also rose for Falklands Islands exploration firms, including Desire Petroleum, Falklands Oil & Gas and Borders & Southern. See the Guardian’s Richard Wray for further reporting.
I repeat, this doesn’t increase the probability that Great Britain and Argentina could, once again, come to blows over the Falkland Islands. What it does do, is increase the potential prize for Argentina.