Platts: China: Coal-to-gas projects

Recent forecasts for Chinese gas output have been bullish, based primarily on the success of production from unconventional gas resources. However, the forecasts of state-owned oil and gas companies' generally fall short of those made by government agencies.

The success or otherwise of unconventional gas in China has major implications for LNG demand and new import pipeline projects.

China hopes to raise its synthetic coal-to-gas output to 50 Bcm a year by 2020, accounting for 12.5% of domestic supply, according to Yang Lei, deputy director of the Department of Oil and Gas at the National Energy Administration, which comes under the umbrella of the powerful National Development and Reform Commission.

The comments echoed those made earlier in January by Wu Xinxiong, NDRC's deputy director as well as head of the NEA, as quoted in the National Business Daily.

Something may have been lost in translation. If 50 Bcm represents 12.5% of domestic supply, it implies that domestic supply will rise to 400 Bcm by 2020, which has generally been the upper boundary of forecasts for total Chinese gas consumption, including imports. It is likely, therefore, that the officials were referring to total Chinese gas supply. MORE