Hong Kong-listed China Resources Gas (Holdings) Limited, one of China's largest city gas distributors, will invest 612.5 million yuan ($98 million) in Qingdao Energy Group's gas arm to co-found a new joint venture gas company, according to a cooperation agreement signed by the two companies in Qingdao recently.

After the capital increase, Qingdao Energy will hold 51 percent and China Gas Resources 49 percent of the new venture, which expects to see overall improvement in gas resources supply, pipeline network construction, operations and services.

The two companies hope to get the joint venture listed on a stock exchange within the next few years and will also help boost Qingdao’s clean energy development.

Qingdao Energy Group is a State-owned energy supplier and the largest local energy enterprise in East China's Shandong province. The company's gas operation covers more than 1 million users in Qingdao. China Resources Gas, which is 63.95 percent owned by China Resources (Holding) Co, one of the largest State-owned conglomerates in China, does business in more than 100 Chinese cities.