MercoPress. South Atlantic News Agency

Natural gas supplies in Kirchner-Lagos agenda

The natural gas crisis, following the latest supply cuts to Chile by Argentina, has irrupted into Monday's bilateral agenda when Argentine president Nestor Kirchner meets with his Chilean counterpart Ricardo Lagos in Santiago.

"We are looking forward to Mr. Kirchner's visit next Monday and obviously natural will be an important issue of the meeting's agenda", admitted President Lagos in a television interview.

Since cuts began last January, Argentina has reduced natural gas daily supply by eight million cubic metres which represent 37% of Chile's demand in the summer months previous to winter's increase, according to Chilean industry sources.

The new natural gas supply crisis, which was preceded by a similar irritating situation last year between April and June, suddenly re-emerged a few days before President Kirchner's visit to Chile.

"We've talked about the issue several times on the phone and we're certainly closely following the situation", said Mr. Lagos underlining the growing concern of Chilean officials with the supply reductions. "We're concerned and uneasy about supply cuts for industry", said Mr. Lagos who nevertheless assured there "won't be any reductions" in natural gas for residential consumption.

Last winter at the most critical point, Argentina natural gas cuts in 2004 represented almost 40% of Chile's supply, with which the country generates 47% of electricity plus supplying industry.

Chilean industrial sources revealed that almost the whole of 300 factories in the central region have suffered major and minor natural gas supply cuts. Further south in Bio Bio, 30 manufacturing plants have been completely cut off and in Valparaiso 90% of factories have undergone restrictions.

"I don't know a single industry which has not had its gas supply cut. And I can't see much changes in the near future to a situation that has emerged extremely strong", said Luis Kohn, president of northern Santiago Industries Confederation..