The move was confirmed by ministers from both Belfast and Dublin in the border town of Newry on Friday as speculation intensified over the early suspension of the Northern Ireland Assembly.

It is planned that the �250m network will link up with the European energy network.

The Northern Ireland pipeline is expected to go from Dublin to Belfast via Newry, Craigavon and Banbridge.

But before that is laid another will go from Belfast to Ballymena, Ballymoney, Coleraine and Londonderry.

Formal launch

Northern Ireland Enterprise Trade and Investment Minister Sir Reg Empey and Finance Minister Mark Durkan joined the Irish Republic's Public Enterprise Minister Mary O'Rourke to formally launch the initiative.

Sir Reg said the project had the potential to make natural gas available to more than 75% of the population and open the way for the building of a new electricity power station at the same time.

He said: "By giving support to this project, the executive has enabled advancement of a high efficiency joint venture power station. The two projects will attract well in excess of �250m investment in the Northern Ireland economy over the next four years.

"The gas project represents the creation of a long-term energy infrastructure which will link the networks in Northern Ireland and the Republic while integrating both systems fully into the European gas market."

Inward investment

Sir Reg also said the proposed pipeline from the south to the north of Ireland would facilitate the development of gas distribution networks to towns on its route and boost the prospects for inward investment in areas of high unemployment.

He added that he felt the executive's decision to provide financial backing for the proposal would be widely welcomed by industrial, commercial and domestic consumers.