Centre, Assam, and Nagaland Forge Historic Tripartite MoU to Revitalise Hydrocarbon Exploration

In a landmark development for India’s energy sector and the progress of the Northeast region, the Government of India, along with the states of Assam and Nagaland, signed a tripartite Memorandum of Understanding (MoU) on June 11, 2026. This agreement opens the door for renewed exploration and production of crude oil and natural gas in the resource-rich Disputed Area Belt (DAB) along the Assam-Nagaland border, resolving a long-standing impasse that had stalled operations for over three decades.

The MoU was signed in the presence of Union Home Minister Amit Shah, Union Petroleum and Natural Gas Minister Hardeep Singh Puri, Assam Chief Minister Himanta Biswa Sarma, and Nagaland Chief Minister Neiphiu Rio. It establishes a collaborative framework covering more than 1,000 square kilometres along the inter-state boundary, enabling joint hydrocarbon and mineral exploration activities.

Centre signs tripartite MoU with Assam, Nagaland to boost oil, gas production | Moneycontrol

Strategic Significance and Resource Potential

The North East has long been recognised as the cradle of India’s petroleum industry. Assam holds nearly 22% of the country’s crude oil reserves and about 15% of its natural gas reserves, while Nagaland possesses substantial untapped potential, particularly in the Naga-Schuppen Belt within the Assam-Arakan Basin. Hydrocarbons in this region are known to flow naturally, underscoring the significant opportunities that lie ahead.

Exploration in the DAB had remained suspended since the mid-1990s due to jurisdictional and boundary-related challenges. The new agreement sets aside immediate territorial claims in favour of a pragmatic 50-50 revenue sharing arrangement between Assam and Nagaland. This approach prioritises national energy interests and paves the way for large-scale investment and operational continuity.

Union Minister Hardeep Singh Puri described the moment as a new chapter for the region, noting that Nagaland is set to resume oil and gas production after 31 years. The pact is expected to provide regulatory clarity, ensure the safety and security of operations, and create a stable environment attractive to investors in the upstream petroleum sector.

Economic and Developmental Impact

Union Home Minister Amit Shah highlighted the transformative potential of the agreement. He observed that the current extraction capacity of 1,000–1,500 barrels per day in the area could increase more than tenfold once full operations resume. Shah further noted that even a single field holds the promise of recoverable resources worth over Rs 15,000 crore.

The resumption of activities is anticipated to bring wide-ranging benefits to the region. It will generate direct and indirect employment opportunities, stimulate local entrepreneurship and small businesses, and accelerate the development of physical infrastructure. Contractors and service providers are also expected to find new avenues for participation, contributing to overall economic growth in both states.

Beyond hydrocarbons, the MoU opens possibilities for broader mineral exploration, further enhancing the economic prospects of the Northeast. This collaborative effort exemplifies cooperative federalism, where states work together with the Centre for mutual benefit and national progress.

A Step Towards Energy Security and Regional Prosperity

This tripartite agreement aligns with broader national goals of strengthening energy self-reliance and reducing dependence on imports. By unlocking the hydrocarbon potential of the Assam-Arakan Basin, it supports India’s efforts to meet growing energy demands through domestic resources.

The development is expected to foster greater stability and prosperity in the Northeast, contributing to infrastructure enhancement and improved livelihoods. It stands as a positive example of how dialogue and shared vision can overcome long-standing challenges.

The MGMM Outlook 

The tripartite MoU between the Centre, Assam, and Nagaland marks a significant breakthrough for the Northeast and reflects a pragmatic approach to resolving long-standing challenges through cooperation. By enabling hydrocarbon exploration in the Disputed Area Belt after more than three decades, the agreement demonstrates how shared economic interests and cooperative federalism can unlock the immense resource potential of the region. The decision to adopt a revenue-sharing model instead of allowing disputes to hinder development highlights a forward-looking commitment to national progress.

The revival of oil and gas activities is expected to strengthen India's energy security while creating new opportunities for employment, infrastructure development, and local entrepreneurship across Assam and Nagaland. With the Northeast possessing substantial untapped reserves, the agreement has the potential to transform the region into a major contributor to the country's energy needs. The initiative also showcases how dialogue and collaboration can foster stability, attract investment, and promote balanced regional growth for the benefit of both local communities and the nation as a whole.

(Sources: Moneycontrol, Times of India, NDTV)