Bolivia, Argentina plan $2 billion pipeline, gas production project

March 9, 2004
Argentina and Bolivia expect to sign a final natural gas sales agreement April 13, solidifying plans for construction of the proposed $2 billion Gasoducto del Noreste Argentino (GNA) pipeline and gas production project.

By OGJ editors

HOUSTON, Mar. 8 -- Argentina and Bolivia expect to sign a final natural gas sales agreement April 13, solidifying plans for construction of the proposed $2 billion Gasoducto del Noreste Argentino (GNA) pipeline and gas production project.

Officials of the two countries met in La Paz earlier this month and agreed to go ahead with the pipeline that would transport gas from Bolivia's Tarija department to Argentina's Santa Fe province, reported Agencia Boliviana de Información, Bolivia's government news agency.

The Argentine firm Techint along with project partners Transportadora de Gas de Norte SA (TGN) and Transportadora de Gas del Sur (TGS) will finance $750 million of the 1,500 km pipeline that represents $1 billion of the GNA project. Argentina will provide the remaining $250 million.

The main gas transmission line, which will have a capacity of 10 million cu m/day (MMcmd), expandable to 30 MMcmd, will require 11 compressor stations, and an additional 1,000 km of smaller diameter laterals and delivery lines also will be required. Pipeline construction is scheduled to start in July and complete in mid-2006.

The pipeline will supply Chaco, Formosa, Misiones, Corrientes, and Santa Fe provinces in Argentina, as well as larger consuming centers in Buenos Aires, Cordoba, and Rosario. The line will connect to Argentina's Loma la Lata pipeline, which TGN and TGS operate, and later it possibly could be extended to Paraguay and Brazil.

Production increases
The second aspect of the GNA is a $700 million investment in Bolivia's upstream production. With 55 tcf of gas reserves, Bolivia is poised to meet the gas needs of Argentina, which is faced with rising demand amid declining reserves.

Techint is seeking to partner with international gas producers in Tarija department to supply gas for the pipeline. Pluspetrol SA, which has 164 bcf of proved and probable natural gas reserves and exported as much as 53.2 MMcmd of gas from its Madrejones field to Argentina until June 2003, is a likely candidate for resuming deliveries.

Brazil's Petróleo Brasileiro SA (Petrobras), Spain's Repsol-YPF SA, and several Russian companies have expressed an interest in investing in the project, Techint said.