A bonanza of natural gas production and export is waiting to begin in South America as investment focus shifts to gas as a greener and safer alternative to oil and nuclear power, the International Energy Agency said in a special report.

Given the right conditions, global gas production and supply may be entering a "Golden Age" but not without a carbon impact and still short of targets to reduce emissions, the agency said in the report, "Are We Entering a Golden Age of Gas?"

Natural gas isn't an entirely innocent energy source and will have carbon footprint that producers and consumers will need to learn to tackle, IEA Chief Economist Fatih Birol, the lead author of the report, told reporters at a news conference called to launch the report.

The IEA's full World Energy Outlook 2011, due out in November, will highlight the growing share of gas in a rapidly changing global situation, most recently altered by the discrediting of nuclear power after the March 11 Japan earthquake and tsunami.

Birol warned that a decisive shift to gas would need to be handled with care and cited unscrupulous practices that negated the positive profile of gas as an environmentally friendly energy source.

"Best practice in production, effectively monitored and regulated, can mitigate other potential environmental risks, such as excessive water use, contamination and disposal," the report said.

All those practices cited by Birol have blighted gas exploration and export in the Americas. Environmental groups have expressed concerns that gas exploration and production may produce new threats.

Hydraulic fracturing has been criticized for introducing contaminating chemicals in previously pristine environments disturbed for the sake of producing gas.

Most Latin American nations have taken to exploring for natural gas as global demand soars, mainly in response to emerging Asian economies China, India and South Korea.

Latin American gas production is expanding most rapidly in Brazil, where output is expected to increase by one-third over the next five years. Brazil's development of pre-salt fields is set to turn the country into a net gas exporter.

Peru increased its gas output after the start-up of its LNG liquefaction plant last year.

Argentina and Bolivia are struggling to find more investors into their upstream operations and resources.

Venezuela's gas production declined in 2009 but is expected to pick up after renewed government measures to reverse the trends.

As gas demand grows, however, new investment is set to pour into exploration, development and export projects across the Latin American region.

The IEA report can be found at: http://www.iea.org/weo/docs/weo2011/WEO2011_GoldenAgeofGasReport.pdf.

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