Argentina Extends Offshore Licences as Court Halts Sea Lion Work

Argentina's offshore licensing and its courts are pushing against each other in the South Atlantic. On September 24, 2026, the government extended offshore drilling licences for five years. The same week, a federal judge in Río Grande, Tierra del Fuego ordered a halt to work on the Sea Lion project.

Those moves sit in the same narrow patch of water and point in two directions at once. One branch of the Argentine state prolonged the legal permission to drill. Another suspended operations on a specific project. Judge Mariel Borruto's order is a precautionary measure in a collective environmental damage lawsuit brought by the Asociación Argentina de Abogados/as Ambientalistas and the Centro Ex Combatientes Islas Malvinas La Plata. The court found that the defendants — Rockhopper Exploration PLC and Navitas Petroleum Development and Production Limited — hadn't filed the project notice or launched the Environmental Impact Assessment that Argentina's General Environmental Law requires for potentially damaging activity.

What the injunction actually covers

The operative scope is that restraint: it stops physical work, not the licence. Drilling seabed and subsoil, subsea infrastructure, pipelines, floating production units, commercial extraction and onshore port works are covered, along with new financing contracts. Companies were also ordered to disclose corporate structure, financial backers and environmental studies. A licence held on paper and a project allowed to proceed are different things, and the injunction bites on the second.

Reporting on the two operators' positions is uneven. Navitas holds 65% of the Sea Lion concession and Rockhopper 35%, per reporting on the project; the field sits roughly 220 km north of the Malvinas Islands. UK coverage has said companies claim valid licences from Britain. A separate report said the UK government backs the extension, with a possible further two-year extension if work programs are completed, and that Sea Lion targets production from 2028 at 50,000 barrels per day — a target, not current output.

A proclamation aimed at the islands

A month earlier, the picture was already moving. On September 6, 2026, Argentina issued Proclamation 868/26, which per reporting effectively nullifies commercial concessions within the Falklands while investigations continue into more than four hundred entities. That same account says Shell halted operations over a litigation threat, Halliburton ceased all contracts tied to the sector, and Arctic Oil Services withdrew from local drilling agreements. No punitive fines were imposed that quarter, the report said, and it described the move as incremental pressure rather than crisis escalation.

Treat that as one outlet's characterization. The proclamation is a dated instrument; the corporate exits are reported consequences, and the scale of investment effects — one projection in the same account put reduced foreign investment inflows at 22% — is an estimate, not a measured outcome.

What the record shows and doesn't

The extension, the injunction and the proclamation are all dated. The one thing the draft treated as an executive objection — a formal note from Milei's administration to the British Embassy calling the permits illegal — isn't supported by the available material, and the administration's threat of a legal challenge against the UK unless work stops, with a two-week deadline and international arbitration mentioned, is likewise unsupported. The government's actual September instrument runs the other way: it nullifies Falklands concessions rather than merely protesting them.

What the record doesn't settle: whether the proclamation reaches Sea Lion's Argentine-side licence or only the disputed islands, how broadly it covers operators in these waters, whether any appeal is pending on the injunction, and whether individual relief exists beyond this one project. There's no completion date for the environmental assessment and no stated penalty.

The decisive unknown is how the instruments interact over time. If the environmental condition is satisfied, the restraint ends and the extension becomes usable. If it isn't, the extension is a five-year right to wait — and a proclamation nullifying concessions nearby can strand the same operators twice over. Until then, the project sits between a permission and a prohibition, with the paperwork extended and the work stopped.

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