NATURAL GAS NETWORKS ARE USUALLY SUPPLIED FROM MULTIPLE SOURCES AND USE INLINE COMPRESSION UNITS TO MOVE GAS TO END CUSTOMERS. THE OPERATION OF SUCH A NETWORK, REQUIRES ACCURATE KNOWLEDGE OF THE STATUS OF THE NETWORK, WHICH CAN BE OBTAINED FORM DIFFERENT SENSORS OF PRESSURE, MASS FLOW AND TEMPERATURE INSTALLED IN DIFFERENT LOCATIONS. THESE SENSORS HAVE MEASUREMENTS ERRORS. TO OVERCOME THESE ERRORS, DATA RECONCILIATION TECHNIQUES ARE REQUIRED. IN THIS WORK, A DYNAMIC DATA RECONCILIATION BASED ON KALMAN FILTER IS DEVELOPED TO ESTIMATE THE UNMEASURED STATES IN A GAS NETWORK. AS PRESSURE AND FLOW CAN BE MADE REDUNDANT THROUGH MASS AND MOMENTUM BALANCES, TWO CASES OF REDUNDANT AND NON-REDUNDANT ARE STUDIED AND HEURISTIC RULES FOR SENSOR PLACEMENT ARE SUGGESTED.