Australian mining giant, BHP Billiton says it has acquired a 40% interest in 14 offshore exploration and production licenses in the Falkland Islands in the South Atlantic.

The 14 production licenses cover approximately 18 million acres located in water depths ranging from approximately 200 to 2,000 meters. BHP Billiton is the designated operator, starting in January next year, with a 40% interest and an option to increase its participation up to 65%, while Falkland Oil and Gas holds the remaining 60% stake.

“We believe this substantial Falklands acreage will be a good addition to BHP Billiton Petroleum’s global portfolio and we look forward to working with our partner to pursue this under explored area,” said Steve O’Rourke, president for exploration, BHP Billiton Petroleum.

Yet, Argentina, which occupied the islands and triggered the Falklands War in 1982, said it would formally complain to Britain over the issuing of licenses and would try to discourage BHP from exploring. It warned the company of possible legal sanctions if it explores in the disputed area.