Guwahati: As Assam positions itself as India’s next big industrial and green energy hub, natural gas is surfacing as the most vital enabler of this process. At the recently concluded Northeast Business Conclave 2.0, organised by Business North East, industry leaders accentuated the growing need for clean, affordable, scalable energy solutions and the immense potential natural gas has, along with biofuels like bamboo-based ethanol and compressed bio-gas (CBG), which are the key drivers of industrial growth, green transportation, and rural economic revival in the region.
Energy infrastructure development is a massive milestone in the region. Northeast Gas Grid is nearing completion amid expansion of city gas and CNG grids, while an unprecedented boom in energy infrastructure designed to bring industries in, reduce urban pollution, and provide high-revenue streams to farmers through bamboo and bio-waste-based fuel is what Assam is poised for.
Northeast Gas Grid On The Brink Of Completion
Subrata Das, CEO of Indradhanush Gas Grid Ltd. (IGGL), emphasised that this integrated gas grid will bridge the region’s industrial energy gap and provide clean energy access across urban and rural areas. "Phase 1 of the Northeast Gas Grid is 97.1% complete, with gas flow expected by March-April 2025. The grid’s 1,670-km network, connecting all Northeast states and parts of West Bengal and Sikkim, is slated for full commissioning by 2027," said Das.
Bamboo-Based Biofuel
While highlighting Assam’s pioneering efforts in terms of biofuels, S.K. Barua, CEO of Northeast Gas Distribution Company Ltd. (NGDCL), praised Numaligarh Refinery Limited’s (NRL) bamboo-based ethanol initiative as a global first in green innovation.
"Numaligarh’s bamboo-based ethanol plant will not only support India’s ethanol blending targets but also transform Assam’s rural economy by making bamboo a high-value commodity," said Barua, further adding that bamboo cultivation — with its three-year harvesting cycle and superior returns over tea — can anchor a sustainable bio-economy, offering a sustainable, high-income alternative to farmers. The plant will produce second-generation ethanol from bamboo, transforming Assam into a major contributor to India’s ethanol blending goals.
City Gas and CNG: Promise vs. Reality
While acknowledging policy support, including Assam’s VAT cut on CNG from 14.5% to 5%, Barua pointed to logistical and demographic hurdles in expanding City Gas Distribution (CGD) networks. However, he also expressed optimism, citing Tripura’s success in achieving 80% petrol displacement through CNG adoption as a model for Assam to follow.
Natural Gas Production Surplus But Affordability Concerns Linger
While natural gas production has improved, affordability remains an obstacle for industries in the Northeast. Gokul Chandra Swargiyari, MD of Assam Gas Company Ltd. (AGCL), confirmed a current surplus of 1–2 MMSCMD, with projections to reach 5 MMSCMD in the next 2–3 years. However, gas prices have tripled from $2 to $6/MMBtu since April 2022, severely impacting energy-intensive industries, particularly Assam’s tea sector.
Oil India’s Upstream Push: Scaling Natural Gas Production to 13.2 MMSCMD by 2026
To address these concerns, Sanjay Verma, Executive Director (Refinery), Oil India Ltd. (OIL), announced plans to ramp up natural gas production from 8 MMSCMD to 13.2 MMSCMD by 2026. Verma assured stakeholders that molecule availability will not be a bottleneck for Northeast’s industrial expansion.
"OIL’s technological upgrades and continuous monitoring ensure we will meet this target," said Verma, who highlighted that 65% of OIL’s workforce is stationed in Assam and Arunachal Pradesh, underlining the company’s Northeast focus. Verma revealed that cutting-edge technologies, including hydraulic fracturing and well-enhanced stimulation, are being deployed to maximize output from our Northeast fields.
Compressed Bio-Gas (CBG): Untapped Potential for Rural Economy
Panellists identified Compressed Bio-Gas (CBG) as the next growth frontier, with Napier grass-based CBG considered a high-income alternative for farmers. Municipal and animal waste were also flagged as viable sources, supported by ₹3–4 crore subsidies under the SATAT scheme. With SATAT scheme subsidies and participation from entities like NRL and OIL, CBG could transform the rural economy and triple farmer incomes.
Experts highlighted that Compressed Bio-Gas (CBG) has the potential to increase farmers' income by 3 to 4 times, driving rural economic transformation in the Northeast while advancing India's green fuel targets.
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Policy Bottlenecks and Infrastructure Delays — Call for GST on Natural Gas
Despite upbeat projections, the experts highlighted serious challenges in pipeline rollout, limited working windows due to adverse weather, forest clearances and social compensation disputes. While they lauded the state VAT reduction on CNG, the absence of GST on natural gas continues to hurt industrial consumers by denying input tax credits. High gas prices since 2022 remain a key concern for industrial consumers, particularly in energy-intensive sectors like tea.
During the panel discussion, industry leaders urged that natural gas inclusion under GST is critical for affordability and industrial competitiveness, calling for central government intervention. While acknowledging Assam's leadership in reducing VAT on CNG, one of the experts stressed the need for central support to extend GST benefits to natural gas.
CNG Expansion Targets, CGD Footprint
Industry leaders outlined ambitious plans to establish 900 CNG stations within the next five years while expanding City Gas Distribution (CGD) networks across Arunachal Pradesh, Nagaland, Manipur, and multiple regions in Assam. Agartala’s success, where petrol consumption dropped by 80 per cent and diesel by 50 per cent over a decade, was highlighted as a model for replication across the Northeast.
A Green Energy Hub in the Making
With the Northeast Gas Grid, city gas expansion, and biofuel initiatives, Assam is on the brink of an energy revolution. However, consistent policy support, industry collaboration and infrastructure expansion will be crucial for transforming Northeast India into a model energy-efficient economy.
Meanwhile, the session on 'Sustainable Energy' was moderated by former Executive Director of Oil India Limited (OIL) Atindra Roy Choudhury and industry experts, including Gokul Chandra Swargiyari (MD, Assam Gas Company Ltd.), Subrata Das (CEO, Indradhanush Gas Grid Ltd.), S.K. Barua (CEO, Northeast Gas Distribution Company Ltd.), Nalini Kanta Buragohain (CGM, Numaligarh Refinery Ltd.) and Sanjay Verma (Executive Director, Oil India Ltd.) took part in the discussion.
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