LIMA, April 4 (Xinhua) -- Bolivia and Argentina Friday signed an agreement to build the largest natural gas liquid segregation plant in Latin America.

    The agreement was signed by representatives from Bolivian Fiscal Oil Fields' (YPFB) and Argentine Energy (ENARSA), according to local media of La Paz, Bolivia's administrative capital.

    Argentina granted the project a credit of 450 million U.S. dollars with a 20-year amortization term, said Bolivian President Evo Morales in a ceremony held at Quemado Palace.

    The construction of the plant was agreed by both governments during the visit of former Argentine President Nestor Kirchner to Bolivia in August 2007.

    The natural gas liquid segregation plant will be set up at Tarija in southern Bolivia. It will form part of the Argentine Northeastern Gas Pipeline (GNA), through which Bolivia supplies fuel to Argentina.

    The plant will process between 36 to 38 million cubic meters of gas daily.

    Tarija has some 85 percent of Bolivia's gas reserves, about 48 billion cubic feet. Bolivia owns the second largest gas field in Latin America after Venezuela.

    Bolivia and Argentina have signed many energy agreements since October 2006.