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The Assam Gas Company Limited (AGCL) and Central government-owned Oil India Limited (OIL) on Saturday signed an agreement to establish a Joint-Venture Private Limited Company (JVPLC) to lay, build and operate city natural gas distribution networks in parts of Assam and Tripura.

In the JVPLC, the Assam government-owned AGCL will have 51 per cent equity with OIL retaining the remaining 49 per cent share.

It would focus on building local natural gas grids and providing piped natural gas to domestic and commercial establishments for cooking purposes in Lakhimpur, Dhemaji, Darrang, Udalguri, Sonitpur and Biswanath Chariali, and a few districts of Tripura for the time being.

According to the agreement, signed at a ceremony held at Janata Bhawan in Dispur, the JV company would also set-up numerous Compressed Natural Gas (CNG) stations to provide gas to CNG-operated vehicles.

Speaking at the event, Assam Chief Minister Himanta Biswa Sarma exuded confidence that the signing of the agreement between AGCL and OIL would provide a major thrust to the ongoing process of industrial development in the state.

The new JV company, with an authorised share capital of Rs 500 crore and initial paid-up capital of Rs 100 crore, would prove to be a milestone in the strengthening of the state's economy in days to come, he said.

The Assam Chief Minister further expressed hope that the JV company would aid in the state's endeavour to make a transition towards a greener fuel-based economy, in sync with the government's Northeast Hydrocarbon Vision-2030.

Highlighting the contribution of the OIL to the economic growth of Assam for the past many decades, the Chief Minister lauded the OIL management for reinvesting a part of its earnings in Assam and other parts of the northeast through initiatives such as the agreement signed on Saturday.

Sarma also praised OIL for its foray into novel energy territories such as solar energy production, among others.

Assam Industries Minister Bimal Bora, Public Health Engineering Departmental Minister Jayanta Mallabaruah, Chairman of AGCL Bolin Chetia, Chairman and Managing Director of OIL Ranjit Rath, among others were present at the agreement signing ceremony.