June 6 (Bloomberg) -- Bolivian President Carlos Mesa left the presidential palace to hold meetings with government officials in a secret location after protests near the palace raised concerns for his safety, a government spokeswoman said.

Mesa, who met on the weekend with congressional and church leaders to discuss calling early elections, is expected to speak to the nation today, Interior Ministry spokeswoman Carolina Floru said in a phone interview from La Paz. Thousands of protesters demanding regional autonomy and nationalization of the oil and gas industry have brought the capital to a standstill, Floru said.

``The president has not resigned,'' Deputy Minister for Social Communication Carlos Agreda told reporters in a broadcast on La Paz radio station Radio Panamericana. ``He continues to seek dialogue.''

Mesa has faced daily protests since Congress May 17 passed a smaller increase in oil and gas taxes than demanded by Evo Morales of the country's second-largest party, Movement Toward Socialism. The law also forces 12 foreign oil companies including Spain's Repsol YPF SA, Irving, Texas-based Exxon Mobil Corp. and Brazil's Petroleo Brasileiro SA to renegotiate 72 oil and gas contracts signed from 1993 to 2003.

Mesa met with military officers today after protesters broke open the main drinking water pipe to La Paz, cutting off the water supply to the capital, the radio said. Gasoline stations and stores closed due to shortages of fuel and basic foodstuffs after two weeks of roadblocks by protesters, according to La Paz daily La Razon.

Call for Resignation

Mesa, who offered to resign in the face of protests against the government's energy policies in March, was counting on foreign investment to tap Bolivia's 28.7 trillion cubic feet of natural gas, Latin America's second-largest reserves after Venezuela, to drive economic growth and create jobs.

After the new law's passage, the president of the Bolivian Hydrocarbon Chamber, Raul Kieffer, said the country stood to lose $10 billion in planned investment as companies such as BG Group in London said they would review their involvement in the Bolivia. Rio de Janeiro-based Petrobras, the biggest foreign oil and gas company in Bolivia, said it will cut back on investment.

Morales, a congressman who leads the second-largest opposition party, called for on Mesa to resign and for his replacement to order a state takeover of all oil and gas fields, Interior Minister Jose Galindo said.

``We must reflect. We're pushing the country toward chaos,'' Galindo told reporters after meeting with Morales and church officials. He said the government would not declare a state of emergency.

Mesa, 51, stepped up from the vice-presidency 18 months ago after violent street protests over plans to export natural gas killed at least 80 people and triggered the resignation of President Gonzalo Sanchez de Losado. Mesa's mandate is scheduled to expire in January 2007.

To contact the reporter on this story: Alex Emery in Lima at aemery1@bloomberg.net

Last Updated: June 6, 2005 18:48 EDT