Bolivia and Argentina launch GNA pipeline tenders
One matter about large-scale energy projects in Latin America is that they take a long time to accomplish. Even so, the governments of Bolivia and Argentina are moving full speed ahead with the construction of the 1,500km Gasoducto del Noreste Argentino (GNA) gasline, which will boost Bolivian gas supplies to Argentina from 2010 by 20 million cu m/day.
Argentina has an agreement with Bolivia to import 7.7 million cu m/d.
The GNA, which will extend from southern Bolivia to the Argentine provinces of Salta, Formosa, Chaco and end in Santa Fe, is now seen costing “over $2 billion.” When the project was launched in November 2003 by Techint and the Argentine government, it was seen costing $1 billion to build.
The first phase of the project includes a tender to purchase steel pipes for $750 million. The following week Bolivia and Argentina will launch a tender to construct the pipeline. Construction is seen beginning in March 2008 and the pipeline should be operational by 2009.
In the agreement, Argentina will fully finance the construction of a gas-separation plant in the Bolivian border town of Yacuiba. A tender to build the plant will be launched August 3.
The cost of the GNA gasline makes it one of the most expensive pipeline projects in South America with Gasene in Brazil, which aims to interconnect the northeast with the southeast of the country. The Gasene line was originally seen costing $767 million but has rocketed to over $2.2 billion. One of the reasons for the higher pricetag are higher steel pipe costs.
There are two important matters to watch concerning the GNA: 1) if there’s enough gas in Bolivia to back 27.7 million cu m/d exports to Argentina at the turn of the decade; 2) cost. Snags and other unforeseeable variables will drive the price of the GNA upwards.
The route of the GNA pipeline. Source: Enarsa