Japanese gas distributor Toho Gas will expand its gas business to Vietnam, in anticipation of higher natural gas consumption in the country as it switches away from oil and coal in efforts to cut CO2 emissions.

Toho Gas will own a 40pc share in Vietnamese gas distributor Phuc Sang Minh Trade Engineering Services (PSE), after completing the stake acquisition process. PSE supplies domestically-produced compressed natural gas by trucks to industrial parks located mainly in Ho Chi Minh city and Hanoi.

The compressed gas is used for boilers and power generation at plants in the industrial parks, which includes aluminum processing factories, Toho Gas said.

Toho Gas sees Vietnam's industrial sector using more natural gas to shift away from oil and coal and cut CO2 emissions. Vietnam's stable economic growth will also lift the country's energy consumption, Toho Gas added.