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Bolivians to Vote to Ship Gas Through Peru or Chile (Update1)

By Inti Landauro

April 15 (Bloomberg) -- Bolivia plans to ask voters to decide whether to export natural gas from the coast of Peru or Chile after a plan to export via Chile sparked riots that led to the resignation of Bolivian president last year.

A nationwide referendum will be held July 18, said Bolivian President, Carlos Mesa in a speech in the town of Tarija. ``The government of Bolivia didn't make a decision on the export harbor,'' the president said. The government will weigh political, economical and technical reasons before making a decision, he said.

Mesa's spokesman, Osvaldo Candia, said earlier in a telephone interview the government didn't plan to go through Chile because it has refused since the 19th century to give landlocked Bolivia an access to the coast. Bolivia will consider doing business with Chile ``only when the issue of the access to the sea is resolved,'' he said.

Protests in Bolivia against the plan to build a pipeline through Chile left 70 dead and helped force Bolivian President Gonzalo Sanchez de Lozada to resign in October. Bolivia lost its only access to the Pacific Ocean after a four-year war with Chile in 1879, and protesters objected to allowing Chile and foreign companies to profit from Bolivia's natural resources.

``Peru will give all the support it can to Bolivia for the development of its natural gas project,'' Jaime Quijandria, Peru's Energy and Mines Minister, said in Lima last night at a press conference with Peruvian Foreign Minister Manuel Rodriguez. Officials didn't estimate the project's cost.

Bolivia, which has Latin America's second-largest gas reserves after Venezuela, plans to ship some of its gas to the U.S. and Mexico. A pipeline across Peruvian territory would be just as profitable as a route leading through Chile, Quijandria told reporters.

Spain's Repsol YPF SA, the largest supplier of liquefied natural gas to the U.S. is building a $350 million plant on the Mexican Pacific Coast to decompress gas shipped by tankers. The Madrid-based company had said it hoped to buy gas from Bolivia.

Hunt Oil Co., a closely held Dallas-based oil and natural- gas exploration and production company, plans to invest $2 billion to build a plant to sell liquefied natural gas from Peruvian field of Camisea to Brussels-based Tractebel SA to export it to Mexico.

Mesa this week agreed to sell gas to Argentina for a period of six months to help ease Argentina's energy crisis.

To contact the reporter on this story: Inti Landauro at ilandauro@bloomberg.net in Lima

Last Updated: April 15, 2004 18:45 EDT

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