Chilean liquefied natural gas regasification project GNL Quintero SA should receive its first gas shipment by June 28 after the ship departed from Trinidad and Tobago on Monday, local newspaper El Mercurio reported.

The ship, the Methane Jane Elizabeth, will take about 20 days to reach Chile with a cargo of LNG worth some $20 million, enough to supply Santiago's natural gas needs for up to three months, the paper reported.

"This is great news...the start-up of the regasification plant in Quintero, the first in South America, will reduce our energy dependence, lower costs and reduce emissions," Energy Minister Marcelo Tokman told El Mercurio.

The project will supply all of the residential and commercial gas demand as well as part of the industrial and power generation demand in the central part of the country including Santiago, said Tokman.

The gas will replace diesel and other oil-based fuels used as substitutes by industries and power generators after Argentina began restricting piped natural gas exports to Chile in 2002.

"The energy crisis, caused by restrictions in Argentine natural gas shipments, higher costs, a drought and failures in some power plants, exposed the vulnerability of our energy system... June will be remembered as the month we began to sail new waters," the paper quoted Tokman as saying.

GNL Quintero will have a regasification capacity of 10 million cubic meters of gas a day, but two storage tanks won't be ready until May. Until then, ships like the Methane Jane will anchor in Quintero acting as storage tanks until their cargo is piped ashore, the paper reported.

The project currently has contracts to supply state oil and gas company Empresa Nacional del Petroleo SA, or Enap (ENAP.YY); power producer Empresa Nacional de Electricidad SA (EOC), or Endesa; and gas distributor Metrogas SA (METR.BA).

Endesa's main rivals Colbun (COLBUN.SN) and AES Gener (GENER.SN), which initially decided not to sign offtake contracts, could also buy gas from the Quintero terminal on the spot market depending on the LNG price.

The Methane Jane is owned by the U.K.'s BG Group PLC (BG.LN), which holds a 40% stake in GNL Quintero and is supplying the LNG from its global portfolio. Enap, Endesa and Metrogas each hold a 20% stake in the company.

GNL Quintero officials weren't available for comment on Monday.

-By Julian Dowling, Dow Jones Newswires; 56-2-820-4241; julian.dowling@dowjones.com