Israeli investors in crosshairs of Argentina's Milei over Falklands oil project

By Stephanie Kelly and Jonathan Saul

LONDON, Sept 4 (Reuters) - Argentine President Javier Milei's push for sanctions on oil companies drilling offshore in the British-controlled Falkland Islands has put Israeli investors at the centre of a sovereignty dispute over which Britain and Argentina went to war in 1982.

Milei, a proclaimed ally of Israel, on Thursday singled out the Sea Lion offshore oil project as he announced measures targeting companies involved in Falklands oil and gas activities, with penalties potentially extending to shareholders, directors and suppliers.

The project's two owners have strong Israeli ties. Sea Lion is operated by Tel Aviv-listed Navitas Petroleum, which holds a 65% stake.

Gideon Tadmor, a prominent figure in Israel's energy sector and also the company's chair, holds about 9% of shares in the company, according to LSEG data.

The remaining 35% of Sea Lion is owned by London-listed Rockhopper Exploration, with Israel-based Noked Capital, Brosh Funds and ION Fund Management among its top five investors, owning between 4.6% and 9.2% each.

Navitas and Rockhopper said the Sea Lion project had valid licences and that they did not expect Milei's comments to have a material effect on the project's development. 

"The Partnership operates pursuant to valid petroleum licences lawfully granted to it by the Government of the Falkland Islands, a self-governing UK Overseas Territory, and with the full and ongoing support of the UK Government," Navitas said in a statement on Friday.

Both companies had already been disqualified from operating in Argentina for 20 years over taking up the licences, which Buenos Aires says are illegal, according to a December 2025 statement on the website of the Argentine embassy in Britain.

Shares in Navitas and Rockhopper fell as much as 6% and 12%, respectively, on Friday.

MILEI'S SUPPORT OF ISRAEL

Israel has sought to shore up relations with countries in Latin America in recent months and has strengthened ties with Milei, who is among Israel’s strongest supporters.

In April, Milei met Prime Minister Netanyahu and signed bilateral cooperation agreements including an aviation deal, and so-called "Isaac Accords", modelled on the Abraham Accords, which aim to strengthen ties between Israel, Argentina and other countries in the Americas.

Israeli officials did not immediately respond to a request for comment on Friday, which is the weekend in Israel, on Milei's sanctions threat. 

Milei's office also did not immediately respond to a request for comment, but Argentine Foreign Minister Pablo Quirno said the move would not cause diplomatic friction with Israel.

"This does not harm the Argentine-Israeli relationship in the slightest. We have been and remain in constant communication with Israel – and with the Israeli Foreign Minister," Quirno told local radio in Argentina on Friday.

"Let us recall that the companies, Navitas and Rockhopper, are already under sanction in Argentina."

FIRST OIL EXPECTED IN 2028

The Sea Lion oilfield lies about 140 miles north of the Falkland Islands.

In 2010, when drilling first found the field, Argentina said it was illegal. It is estimated to hold 1.7 billion barrels of oil.

First oil from Sea Lion is expected in 2028 when Phase 1, which Rockhopper and Navitas reached a final investment decision on last year, kicks in, with a rate of 50,000 barrels per day. Capital expenditure for the project is expected at $2.2 billion, according to Rockhopper's website.

Navitas, whose CEO Amit Kornhauser previously served as finance chief of Israeli oil and gas firm Delek Energy, came into the project and took over operatorship in 2022.

Rockhopper also holds licences to the east and south of the Falkland Islands, although some run out at the end of 2026, according to the firm's website. 

Expanding beyond Israeli projects, Tel Aviv-listed New Med owns 30% of the Aphrodite gas discovery offshore Cyprus.

(Reporting by Stephanie Kelly, Jonathan Saul, Shadia Nasralla in London, additional reporting by Robert Harvey in London and Leila Miller and Lucila Sigal in Buenos Aires; Editing by Alex Richardson)