MercoPress. South Atlantic News Agency

Bolivia's gas plan may hit Chile's supply

Chile could face power shortages as a result of Bolivia's plan to nationalise its gas sector, energy experts have warned.

More than a third of Chile's energy generating capacity is supplied by gas, all of which is imported from Argentina. But in order to fulfil its export commitments to Chile of about 15m cubic metres of gas a day, Argentina imports on average 6m cu m a day from Bolivia for $3.35 per million BTU.

Bolivia, which moved to nationalise its gas industry last month, is now demanding sharp increases in the price of gas to be exported to Argentina to $5.50 per million BTU.

"If Argentina cannot get enough gas from Bolivia it will inevitably have to cut exports to Chile ? there's no magic," says Daniel Montamat, a former energy minister in Argentina and previously head of the former state oil company YPF.

The Bolivian government says President Evo Morales would meet Néstor Kirchner, Argentina's president, next week to set the price of gas. But talks between the two countries have foundered on concerns in La Paz that Buenos Aires is, in effect, re-exporting gas to Chile, Bolivia's historic rival.

Andres Soliz, Bolivia's hydrocarbons minister, said this week that an admission by Mr Kirchner that his country re-exports Bolivian gas had upset the talks. "The moment that Kirchner declared that the gas is for Chile, the difficulties started," said Mr Soliz.

A trip by Julio de Vido, Argentina's planning min-ister, to Bolivia to discuss prices has been repeatedly postponed. As part of any agreement, Argentina also wants to see imports increasing by 20m cu m a day.

Bolivia and Chile have not had diplomatic ties since 1978. Relations have been tense since the 19th century, when Chile defeated Bolivia and annexed its mineral-rich coastline. In 2003, former Bolivian president Gonzalo Sanchez de Lozada was forced out of office after proposing gas exports via Chile.