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I had a 1999 Chevy monte carlo which I believe is the same body style still. I had the same problem with the theft light. Eventually it got bad enough though that the car wouldn't start. Mine wasn't a problem with the key; however it was with the resistor reader in the ignition cylinder. They wanted some high price to replace the cylinder. I ended up fixing it with a .15 cent resistor from Radio Shack. Just take a multimeter and read the resistance coming across the pellet in the key. Goto your local friendly radioshack and get a resistor. There are a few wires running from under the steering column. Just solder it into the right one and your good to go. If you want more exact information on which wires I can dig the info up. I just don't recall it off the top of my head right now.
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