I wish to play with a friend who owns the game on GOG and I am on STEAM

I don't see why not? Steam version is actually a DRM-FREE game so it is not really dependent on Steam. I own them on both sides and there are no difference.

Just make sure they you both have the same version. I remember there used to be a problem when someone had Dragonspear installed but that's for BG1:EE which is not your question :)

Yes, it should be possible. I successfully gamed via my GOG on PC with someone on their phone.

I did it with my friends, but it is a little tricky. You have to create a local network using external software, for example Hamachi. You and your friends should be all connected to this local network. Then in Baldur you have to create new local network game and participants have to connect directly using IP provided by the local network, created via above method. It works also with Linux.

In my experience, network emulation is not required. I hosted. A friend in another country put in my IP address and joined the game with no issue. The usual caveats about hosting apply - check your router's NAT settings, firewalls, etc. In my case, we expected and handled all that.

It is possible to connect directly between Steam and GOG users, without need for emulation. Beamdog themselves hosts the connections. However, bear in mind that it's very prone to crash.

BG supported multiplayer even when it first came out in 1998 !

Long before Steam or GoG existed. :-)