China Hopes to Double CBM Output by 2015

China plans to boost incentives to coal bed methane industry in hopes of doubling its output by 2015.

China's No. 2 oil and gas producer, China Petrochemical Corp. (Sinopec), said the nation aims reduce its dependence on oil and gas imports by increasing annual CBM production to 21 billion cubic meters by 2015 from 8.6 billion cubic meters last year.

China wants to triple the use of gas to about 10 percent of energy consumption by 2020.

The government plans to double the coal-bed gas production subsidy to 0.40 yuan (6 US cents) per cubic meter and increase the subsidy to 0.35 yuan per kilowatt-hour from 0.25 yuan for power generated by coal-bed methane, Sinopec said. China also plans to set up a risk fund for the exploration of the fuel, it said.

China is tapping unconventional gas resources, including shale gas and tight gas, as part of a long-term strategy.

Jie Mingxun, head of PetroChina's coal-bed methane unit, said last year that unconventional gas (coal-bed methane, shale gas and tight gas) output may eventually account for 30 percent of the nation's total gas output.