Clinton offers U.S. help on Falklands dispute

Mon Mar 1, 2010 12:37pm EST

* Falklands a source of tension between U.K., Argentina

* Other Latin Americans nations support Argentina

MONTEVIDEO, March 1 (Reuters) - Secretary of State Hillary Clinton said on Monday the United States stood ready to help Argentina and Britain resolve new tensions over the disputed Falkland Islands, which sparked a war between the two countries in 1982.

"We'll be going to Buenos Aires later today, I look forward to meeting with President (Cristina Fernandez) de Kirchner and discussing a full range of issues," Clinton said during an appearance in Montevideo, where she was attending the inauguration of new Uruguyan President Jose Mujica.

"It is our position that this is a matter to be resolved between the United Kingdom and Argentina. If we can be of any help in facilitating such an effort, we stand ready to do so," Clinton said.

Argentina has objected to a British company's oil exploration off the Falklands, known in Spanish as Las Malvinas, but Britain has rejected the complaint.

Clinton's offer of help came on the first full day of a Latin America tour that will later take her to quake-hit Chile and regional heavyweight Brazil along with Costa Rica and Guatemala.

Argentina, which has claimed the South Atlantic islands since Britain established its rule in the 19th century, invaded them in 1982. After a two-month war, it was forced to withdraw, but still claims the archipelago and says oil exploration by Britain's Desire Petroleum DES.L is a breach of sovereignty.

Argentina formally objected to the drilling and said it would require all ships from the Falklands to obtain permits to dock in Argentina.

The "Rio Group" of Latin American leaders, meeting last month in Mexico, issued a statement supporting Argentina's demands to halt drilling around the Falklands, and Fernandez has said Latin American nations back Argentina in the dispute.

Brazilian President Luiz Inacio Lula da Silva said the matter should be revisited by the United Nations.

A spokesman for British Prime Minister Gordon Brown said last week he did not expect any direct contact between Brown and Fernandez on the issue and said Britain had given no thought to any military response.

The Falklands are not an onshore oil producer and have no proven onshore reserves, but oil companies are betting that offshore fields hold billions of recoverable barrels of oil.

Desire Petroleum said it broke ground at a well on its offshore "Liz" prospect, which could contain up to 400 million barrels, though the exploration may recover nothing.

The United States attempted to be neutral in the 1982 military clash, with then-Secretary of State Alexander Haig embarking on shuttle diplomacy that sought a negotiated settlement.

Argentina's ill-fated Falklands campaign is widely seen as a mistake by the discredited military dictatorship ruling at the time. However, Argentina's government has said it will continue to seek sovereignty over the islands. (Reporting by Andrew Quinn; editing by Philip Barbara)

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