In recent years, natural gas in China has witnessed rapid development and has become a spotlight in Chinese petroleum industry. Gas is increasingly revealing its great potential.

During the years 2000-2007, the annual average newly-added proven gas reserves are over 500 BCM, and the annual growth rate of gas production is averaged at 14.8%. The accumulative newly-added gas reserve and production in the past few years surpassed the total in the previous 50 years. The length of the newly-built gas pipelines is more than 30,000 km. After the establishment of several trunk lines, such as 'West-East Gas Pipeline' which transmits gas from Xinjiang to Shanghai, a gas pipeline network is completed connecting major gas producing areas, and a trunkline framework is constructed connecting major gas producing areas and major gas consuming areas.

Gas consumption market goes up rapidly. At present, gas is consumed in 28 provinces (and municipalities directly under jurisdiction of central government), covering over 40% of medium cities. In 2007, gas took 3.4% in total energy consumption, one percentage point up than that in 2000.

According to the recent appraisal for China, the forecast conventional gas resources are 35 TCM with the recoverable of 22 TCM. The proven degree is only 15%, which bears great potential for gas development.

Particularly, along with the acceleration of industrialization and urbanization, and the increasing requirements of environmental protection and energy mix optimization, gas demand is increasingly booming, driven by social and economic development. Chinese government has attached great importance to gas industry development and established a series of stimulative policies. The Eleventh Five-Year Plan of Energy Development clearly demonstrates that the gas proportion shall be up to 5% in total primary energy production and 5.3% in total energy consumption by 2010, and another 2 percentage points shall be added by 2015.

It should also be noted that a series of new achievements have been made in international oil & gas cooperation and gas import. The first onshore transnational gas pipeline, i.e., Central Asia-China Gas Pipeline, is now under construction. It will play an active role in building up a diversified oil & gas supply system in China.

Thus, Chinese natural gas industry is displaying a brand-new pattern of quickening development, providing a strong drive to the sustainable and steady development of Chinese petroleum industry.