IGL currently sells compressed natural gas (CNG) and piped natural gas (PNG) in the national capital and adjoining cities of Ghaziabad, Noida and Greater Noida.
The Petroleum and Natural Regulatory Board (PNGRB) had previously authorised Haryana Gas Ltd for city gas distribution but IGL had challenged that saying it was authorised by the central government in 2004, years before PNGRB came into existence.
IGL in a statement said it has "received permission from the state government of Haryana to lay city gas distribution (CGD) network in a part of Gurugram."
"As per letter issued by Director of Industries and Commerce, Government of Haryana on July 13, 2017, IGL has been permitted to lay city gas distribution network in Gurugram in the area lying between west side of Sohna Road and National Highway - 8 of Gurugram," the statement said.
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The state government of Haryana has also decided to allocate 10 plot sites for setting up CNG stations for which IGL has been asked to identify the areas.
IGL Managing Director E S Ranganathan said the company is ready to meet the target of setting up 10 CNG stations and providing 10,000 PNG connections.
"IGL is in the process of drawing up an investment plan amounting to capital expenditure of Rs 75 crore to Rs 100 crore in a year in this area," he added.
IGL is already the largest CNG distribution company in the country having set up 425 CNG stations in less than two decades.