Bolivia's natural gas is not for sale, opponents say

President Carlos Mesa said the vote set for 18 July was a historic challenge.

Weeks of often violent protests over plans to export gas brought down Mr Mesa's predecessor last October.

Opponents say Bolivia's gas is for Bolivians, not foreigners, and want the government to nationalise the reserves - Latin America's second-largest.

They fear that otherwise proceeds from gas sales will simply enrich foreign companies investing in the project.

Mr Mesa's planned referendum aims to defuse the controversy but observers say the president, who is facing growing public opposition on a range of issue, is likely to see his own political future decided by the result.

In a television address to the nation on Wednesday, Mr Mesa said the historic vote would allow Bolivians to decide the strategic use of its most important natural resource.

Bargaining chip?

Mr Mesa said the Bolivian people would be asked if the state should regain control over the gas sector, which was opened up to private investors in the mid-1990s, and whether natural gas should be exported.

Voters will also be asked if gas sales should be used as a bargaining chip in any negotiations with Chile in the territorial dispute over access to the Pacific.

Earlier plans to export the gas through Chilean ports on the Pacific coast to US markets angered nationalists, because the ports belonged to Bolivia before the 1879 war with Chile.