TOKYO (Reuters) - Japan's Osaka Gas Co said on Monday it has entered India's urban gas distribution market by investing in the local unit of Singapore-based AGP International Holdings (AG&P) as part of its overseas expansion drive.
Demand in India's natural gas market is set to surge as the government wants to raise the share of the cleaner fuel in its energy mix to 15% by 2030 from the current 6% to combat climate change.
Osaka Gas, Japan's second-biggest city gas supplier, plans to invest up to $120 million in the Indian unit of AG&P together with a state-private fund, Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN).
The AG&P unit has exclusive gas sales rights for eight years for 12 geographic areas, and infrastructure licenses for 25 years in those places.
Osaka Gas, which did not disclose how big a stake it would own in the unit, said India was a key growth market in Asia for the firm.
"We also want to pursue other business opportunities in India, including renewable energy," Katz Sato, senior general manager at Osaka Gas, told reporters.
The company has embarked on an overseas expansion to achieve its long-term goal, set in 2017, to triple its recurring profits by 2030, with contribution from abroad to account for one-third of the total profit, from about 5% in 2017.
(Reporting by Yuka Obayashi; Editing by Pravin Char)