With 55 trillion cubic feet of gas reserves Bolivia is in the perfect position to take advantage of Argentina's rising gas demand as the country's domestic reserves continue to decline due to a lack of investment in gas exploration.

The GNA project will incorporate part of an existing pipeline between the two countries that was used to export gas from Bolivia to Argentina until the 1980s. Construction consists of a US$1bn, 1,500km pipeline, which will initially transport 10 million cubic metres a day (mcm/d), and could be enlarged to 30mcm/d, with investment in the upstream part of the project expected to be about US$700m.

Development is planned to start by July at the latest and wrap up in 2006.

The pipeline will connect to Argentina's existing Loma la Lata pipeline operated by local gas transporters TGN and TGS, and could be extended to Paraguay and Brazil in the future.

Bolivia stands to earn some US$500million a year by exporting gas to Argentina and US$100million in royalties for the government.