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Shipments to Chile resumed

Thursday, May 31st 2007 - 21:00 UTC
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Argentina resumed shipments of crucial natural gas to Chile's populous central region yesterday, Chilean energy officials said, easing fears that an acute energy shortage could worsen.

Argentina reopened the natural gas taps after a cold front on Monday prompted it to completely cut natural gas exports to central Chile, where the capital, Santiago, is located, forcing the Andean neighbor to resort to other fuels for industry. "There is enough (natural gas) arriving to cover commercial and residential gas needs," Chile Energy Minister Marcelo Tokman told journalists in Santiago yesterday. Industries in central Chile have complained that the shortages of gas from Argentina could hurt them competitively as they are forced to burn costlier fuels, such as diesel. It was not clear what effect the gas drought could have on the nation's robust economic growth this year. "This is an issue we have to pay close attention to, we have to be vigilant," Chile Finance Minister Andres Velasco said during a teleconference from New York. "But I think it's a little early to be jumping to conclusions," he said. The government has estimated Chile's economy will grow 5.7 percent in 2007, compared with 4.0 percent in 2006. The National Energy Commission said separately that gas flow resumed at around 6 a.m. (1000 GMT), adding that it would continue to monitor the situation in conjunction with local business and Argentine authorities. Chile is fully dependent on Argentina for its natural gas supplies. Its central region needs about 1.5 million cubic meters of natural gas per day to supply its homes and businesses.

Categories: Energy & Oil, Latin America.

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