A UN ruling that the Falklands are within Argentinian waters has prompted fears the South American country will attempt to claim the region's vast oil reserves.

The UN commission's decision sees Argentina's territory in the South Atlantic expanded by 35 per cent to include the disputed islands and beyond.

Although Argentina lost the brief but bloody war with Britain over their governance in 1982, the UN sided with the country and ratified the country's 2009 report fixing the limit of its territory at 200 to 350 miles from its coast.

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Argentina still claims ownership of the islands, which it calls the Malvinas, and claims the UN commission's decision means it can push ahead with claims over sovereignty rights

Susana Malcorra, Argentina's foreign minister, said: 'This is a historic occasion for Argentina because we've made a huge leap in the demarcation of the exterior limit of our continental shelf.

'This reaffirms our sovereignty rights over the resources of our continental shelf.'

Oil exploration is already pumping millions of dollars into the Falkland Islands economy.

However, many islanders remain concerned about Argentina's claim as well as the potential for problems from rapid change brought by the new industry.

The U.N. commission's finding included the caveat that there is an unresolved diplomatic dispute between Argentina and Britain over the islands.

The Falklands are internally self-governing, but Britain is responsible for its defense and foreign affairs.

The British government says islanders cannot be forced to accept Argentine sovereignty against their will.

The Falkland Islands government said Monday that it is seeking clarification from the British government on 'what, if any, decisions have been made, and what implications there may be' for the territory in relation to the U.N. ruling.

Mike Summers, chairman of the Legislative Assembly of the Falkland Islands, told AP in an e-mailed statement: 'As soon as we have any firm information we will make it available.

'Our understanding has always been that the UN would not make any determination on applications for continental shelf extension in areas where there are competing claims.'

Argentina lost the brief but bloody war with Britain over the governance of the Falklands in 1982. Pictured are Royal Marines landing ashore at Port San Carlos on East Falkland

Royal Marines dig a settlement during the Falklands War, in which Britain reestablished its control of the territory

The Prime Minister's official spokeswoman said: 'At this stage we have yet to receive details of that report. It is important to note that this is an advisory committee. It makes recommendations, they are not legally binding.

'Speculation about what the report says has come from Argentina. I think we should wait to see what comes from the commission in New York.'

She added: 'What is important is what the Falkland Islanders themselves think.