Argentina intending to establish an observation station in South Georgia according to the U.S. Joint Intelligence Committee. Daily summary dated 26 March 1942

An item referred to a report of the commander of an Argentine transport recently visiting Deception Island (South Georgia). He suspected that the former Norwegian whale factory there was used by the Japanese as a submarine base. To the already existing factory and three houses as a concrete building with modern installations and 15 smaller dwellings added. The Argentines destroyed 7 nearly empty oil tanks with a total capacity of 35.000 litres, a modern electric charging plant and thousand tons of coals. The presence of volcanic hot spring made it possible to use the bay the year round for landing seaplanes. As a result intended Argentina to establish an observation station. The J.I.C. commented that South Georgia was part of the British Falkland Islands colony about which sovereignty the United Kingdom and Argentina disagreed, so this  Argentine move cold complicate the relations furthermore.

Source

Map Room Papers (Roosevelt Administration), 1942 - 1945. U.S. Joint Intelligence Committee. Daily summary No. 106 dated 26 March 1942