Oil exploration in the Falkland Islands has increased since the mid-nineties.
shows and have shown there to be good quality reservoir rocks, which although not as promising, provide invaluable information for any future drilling that may take place in the area.
Effects onshore Although exploration operations so far have concentrated in the waters to the north of the Islands, 2012 will see the arrival of a dedicated harsh environment rig to drill prospects to the south and east of the Islands for a minimum of six months.
Exploration has had relatively little physical onshore impact in the Islands, and although dedicated storage and lay-down facilities have been built by the companies, the self-sufficient nature of the industry has not required any major development so far. In economic terms, however, oil exploration has had a significant impact on the Islands, with an estimated G.B.£10 million of additional turnover being injected into the local economy every year. Given that the Islands’ gross domestic product is around £104 million, this is no mean
amount! Such an influx of cash is, of course, very much welcomed by the Falkland Islands government, but it remains wary of any artificial inflation that may arise as a result. The industry is licensed and regulated by the Falkland Islands government’s Department of Mineral Resources, which in turn reports to the Mineral Resources Committee, made up of two elected Members of the Falklands’ Legislative Assembly and senior civil servants. All approval and licensing decisions have to be sanctioned by the Mineral
Resources Committee before they are passed on to the government’s Executive Council and the Governor for ultimate approval. Since the early nineties, the
Falkland Islands government has employed the British Geological Survey as technical advisors, providing guidance on not only exploration and geological matters, but also licensing, legislation and tax regimes. Similarly, a Memorandum of Understanding with the United Kingdom’s Health and Safety Executive allows the Falklands’ government to seek