China Natural Gas Development Report 2025

Cover Information

Publisher: Petroleum Industry Press

Authors: Editorial Committee of "China Natural Gas Development Report (2025)"

Research Team: China National Petroleum Corporation (CNPC) National High-End Think Tank Research Center, et al.

Guiding Institutions: Oil and Gas Department of the National Energy Administration, Resources and Environment Policy Research Institute of the Development Research Center of the State Council, Oil and Gas Resources Strategy Research Center of the Ministry of Natural Resources

Preface

In 2024, the global economy experienced moderate recovery amid intensifying major power competition and regional conflicts. The global energy landscape and trade flows continued to adjust, and energy prices further declined. China’s natural gas industry, guided by the spirit of the 20th National Congress of the Communist Party of China and subsequent plenary sessions, adhered to the principles of high-quality development and high-level security. Natural gas consumption maintained robust growth, supply capacity was further consolidated, and the sector made positive contributions to the global green energy transition and the stability of the natural gas industry chain.

The Third Plenary Session of the 20th CPC Central Committee made comprehensive arrangements for deepening reform and advancing Chinese modernization. The enactment of the Energy Law of the People’s Republic of China provided a legal framework for fundamental issues in the energy sector. Moving forward, the natural gas industry will continue to deepen market reforms, improve the "X + 1 + X" market system—characterized by diversified upstream supply, efficient midstream transportation, and competitive downstream sales—enhance security of supply, promote low-carbon transformation, and support the stable and healthy development of the industry, thereby better serving the modernization of China.

I. Global and Domestic Natural Gas Developments in 2024

1. Global Natural Gas Developments

1.1 Consumption Growth Rebounds, Asia-Pacific Leads Global Increase

In 2024, global natural gas consumption reached 4.13 trillion cubic meters, with the growth rate rising from 0.1% in the previous year to 2.5%. This was mainly driven by falling international gas prices, moderate global economic recovery, and extreme summer heat in the Northern Hemisphere. Europe saw its first positive growth in three years, with annual consumption of 468.7 billion cubic meters, up 1.4% year-on-year, mainly due to lower prices stimulating industrial demand. However, weak economic activity and increased output from renewables and nuclear power limited gas-fired power demand. North America’s annual gas consumption reached 1.1 trillion cubic meters, up 1.3%. The US consumed 902.2 billion cubic meters, up 1.3%, mainly driven by increased gas use for power generation. The Asia-Pacific region’s annual gas consumption was 972.7 billion cubic meters, up 4.5%, with China and India showing the most significant growth at 7.3% and 13.0%, respectively. South Korea’s consumption increased by 5.7%, while Japan’s consumption declined by 1.0% for the second consecutive year.

1.2 Upstream Investment Adjustments and Production Growth

In 2024, global oil and gas exploration and development investment totaled $554 billion, down $14.7 billion (2.5%) from the previous year—the first decline since 2021. Investments in Russia–Central Asia, Asia-Pacific, the Middle East, and the Americas fell by 5.3%, 4.0%, 3.5%, and 3.2%, respectively, while Africa and Europe saw increases of 5.2% and 3.4%. Global natural gas production reached 4.12 trillion cubic meters, up 1.5%. The US produced 1.03 trillion cubic meters, essentially unchanged from the previous year. The Middle East increased production by 18.4 billion cubic meters (2.3%), and Russia by 43.5 billion cubic meters (7.1%). There were 94 new gas field discoveries worldwide, with newly proven reserves totaling 670.2 billion cubic meters—a six-year low. The main new reserves were in Brazil and the UK. Of the world’s top ten oil and gas discoveries, three were gas fields located in Russia, Bolivia, and Indonesia.

1.3 Trade Recovery and Shifting Flows

In 2024, global natural gas trade reached 1.2 trillion cubic meters, up 1.9%. Pipeline gas trade grew by 2.2%, accounting for 55.4% of total gas trade. Global LNG trade grew by 1.4%, with US LNG exports reaching 121.9 billion cubic meters (up 2.7%), accounting for 21.4% of global LNG trade. European pipeline gas imports reached 330 billion cubic meters (up 5.5%), with notable growth from Norway. European LNG imports fell to 140.3 billion cubic meters (down 19.3%). Asian LNG imports reached 405.6 billion cubic meters (up 11.1%), with Japan, South Korea, and India increasing imports by 1.4%, 4.8%, and 21.2%, respectively. New and emerging markets imported 58.2 billion cubic meters (up 12.1%). US LNG flows to Europe fell by 19.0% but rose to Asia by 37.2%. Qatar’s LNG flows to Europe fell by 33.0% but rose to Asia by 6.4%. New long-term LNG contracts totaled 76.61 million tonnes per year, with Asia accounting for 30.4 million tonnes and Europe 8.3 million tonnes. Contracts indexed to Brent crude accounted for 58.2%, up 8.2 percentage points.

1.4 Steady Infrastructure Expansion, Lower LNG Terminal Utilization

In 2024, the global natural gas pipeline network reached 1.368 million kilometers, mainly in North America, Europe, Asia-Pacific, and Russia–Central Asia. The US accelerated shale gas pipeline construction, and India expanded coastal pipelines. There were 796 operational underground gas storage facilities worldwide, with a total working capacity of 439 billion cubic meters. LNG terminal capacity increased by 43.68 million tonnes per year, with 13 new projects coming online, bringing total global capacity to 1.094 billion tonnes per year. There were 50 operational floating terminals, accounting for 14.5% of total capacity. Average global LNG terminal utilization was 37.3%, down 4.3 percentage points.

1.5 Supply-Demand Balance and Price Decline

In 2024, the global gas market remained generally well-supplied, with international spot prices falling for a second consecutive year. The TTF spot price averaged $10.9/MMBtu (2.8 RMB/m³), down 15.3%. Northeast Asia’s spot LNG price averaged $11.8/MMBtu (3.0 RMB/m³), down 26.6%. The US Henry Hub spot price averaged $2.19/MMBtu (0.55 RMB/m³), down 13.6%. LNG shipping markets were loose, and freight rates fell sharply.

1.6 Low-Carbon Transition and the Growing Role of Gas-Fired Power

Gas-fired power’s role in energy transition became more prominent, with AI, data centers, and electrification driving demand. The US doubled its under-construction gas-fired capacity to 85 GW. The UK’s clean energy plan emphasized gas-fired power’s importance for security. In Asia, many countries are shifting from coal to gas for power generation. Major LNG producers are advancing decarbonization, including CCUS deployment in LNG projects.

2. China’s Natural Gas Developments

2.1 Rapid Consumption Growth and Market Dynamics

In 2024, China’s natural gas consumption grew by 7.3%, accounting for 8.8% of total primary energy consumption. Urban gas consumption grew by 11.1%, industrial use by 6.1%, and power generation by 9.5%. Several provinces saw double-digit growth, with Guangdong exceeding 40 billion cubic meters in consumption.

2.2 Exploration Breakthroughs and Unconventional Gas

Major breakthroughs were achieved in deep and unconventional gas exploration. Newly proven reserves exceeded 1.6 trillion cubic meters, and total production reached 246.5 billion cubic meters (up 6.0%). Unconventional gas production exceeded 100 billion cubic meters for the first time, accounting for 44.5% of total output.

2.3 Pipeline Imports Rise, LNG Import Growth Slows

China imported 181.7 billion cubic meters of natural gas (up 9.9%), with pipeline imports rising 13.1% and LNG imports up 7.7%. Russia, Australia, Turkmenistan, Qatar, and Malaysia were the main suppliers.

2.4 Infrastructure Expansion and Storage Capacity Growth

Over 4,000 km of new pipelines were built, bringing the national total to 128,000 km. Several new underground storage facilities and LNG terminals were commissioned, significantly increasing storage capacity.

2.5 Policy Optimization and Industry Leadership

The Energy Law was enacted, providing a legal framework for the sector. Policies were introduced to support unconventional gas, optimize infrastructure access, and promote market-based pricing.

2.6 Technological Breakthroughs and Digital Integration

Significant advances were made in deep and ultra-deep exploration, drilling technology, and digital integration, including AI applications in oil and gas.

2.7 Multi-Energy Integration and Decarbonization

Efforts to integrate natural gas with renewables and hydrogen accelerated, with pilot projects in green gas supply, hydrogen blending, and clean energy hubs.

II. Deepening Reform and Improving the Market System

Since 2017, China has advanced market-oriented reforms in the natural gas sector, improving the market system and resource allocation. The Energy Law and recent policy decisions provide a foundation for further reform, focusing on stimulating market vitality, optimizing resource allocation, and enhancing infrastructure access and pricing mechanisms.

1. Upstream Exploration and Imports

Reforms have opened the upstream sector to more participants, including private and local enterprises. The number of licensed companies has increased, and domestic production has grown for eight consecutive years. LNG importers have increased from fewer than 10 in 2017 to over 20 in 2024.

2. Midstream Transportation

The establishment of the National Pipeline Network Corporation in 2019 and the transfer of pipeline assets in 2020 enabled independent operation and fair access. By 2024, the number of shippers rose to 765, with small and medium shippers accounting for 10.2% of transported volumes. Policies have promoted unified national pipeline planning, pricing, and open access.

3. Downstream Utilization and Market-Based Pricing

Policies have promoted efficient gas use in urban, industrial, power, and transport sectors. Market-based pricing has expanded, and trading volumes at Shanghai and Chongqing gas exchanges have grown. Efforts continue to improve price linkage mechanisms and support the development of LNG futures markets.

III. Outlook for 2025

In the first half of 2025, international gas prices remained relatively high due to supply disruptions, cold weather, and inventory drawdowns. China’s gas consumption growth slowed, with a 0.9% year-on-year increase. Power generation demand grew, while industrial demand was weak. Domestic production grew by 5.8%, but imports fell by 7.8%, with pipeline imports up 10.5% and LNG imports down 20.6%.

In the second half of 2025, the global gas market is expected to remain in a fragile balance, facing uncertainties from geopolitics, weather, and economic trends. China’s macroeconomic recovery will support steady gas demand growth, with consumption expected to rise by 2–3%. Domestic production is expected to increase by over 10 billion cubic meters for the ninth consecutive year.

Conclusion

2025 marks the end of the 14th Five-Year Plan and a critical year for deepening reform and advancing modernization. China’s natural gas industry will continue to promote coordinated development of production, supply, storage, and sales, improve the market system, and contribute to energy security, green transition, and the dual carbon goals. The industry aims to lay a solid foundation for the 15th Five-Year Plan and the continued high-quality development of China’s economy and society.

2025 also marks the tenth consecutive year of publication for the "China Natural Gas Development Report." The editorial committee extends its gratitude to all contributing institutions, experts, and stakeholders for their support.

Major Events in China’s Natural Gas Development, 2024–2025

January 2024

• Jan 26: Construction began on the Hulin–Changchun gas pipeline, a 2,073 km project integrating into the national network, adding 10 billion cubic meters of annual supply.

February 2024

• Feb 29: Ten ministries jointly issued the "Green and Low-Carbon Transformation Industry Guidance Catalogue (2024 Edition)."

March 2024

• Mar 4: China’s first scientific exploration well exceeding 10,000 meters, the Deep Earth TACO-1 Well in Tarim Oilfield, set a new Asian record.
• Mar 11: The 100-billion-cubic-meter Daqitian gas field in western Sichuan was completed and commissioned.
• Mar 29: The Southern Xinjiang gas pipeline project commenced, with the first phase spanning 616 km.

April 2024

• Apr 28: The National Energy Administration held the 2024 National Oil and Gas Pipeline Planning and Construction Conference in Wuhan.
• Apr 29: China State Shipbuilding Corporation signed a contract with QatarEnergy to build 18 ultra-large LNG carriers.

May 2024

• May 1: China’s first regulation on carbon emissions trading came into effect.
• May 3: The Yangtze River shield tunneling project for the China–Russia East gas pipeline was completed.
• May 15: The first LNG carrier of China’s largest construction project was delivered in Shanghai.
• May 21: Fujian Zhangzhou LNG terminal was commissioned.
• May 29: The State Council issued the "2024–2025 Energy Conservation and Carbon Reduction Action Plan."

June 2024

• Jun 4: The Ministry of Ecology and Environment and others issued the "Implementation Plan for Establishing a Carbon Footprint Management System."
• Jun 6: The first ultra-deepwater shallow gas field was discovered in the southeast waters of Hainan Island.
• Jun 6: The foundation stone was laid for the Yu 37 gas storage facility, the largest in western China.
• Jun 30: The world’s largest 270,000 m³ LNG storage tank cluster was completed in Yancheng, Jiangsu.

July 2024

• Jul 8: Four parties signed an MOU to establish a hydrogen-based green energy trading platform in Shanghai’s Lingang New Area.
• Jul 9: The Zhangzhou LNG outbound pipeline was fully commissioned.
• Jul 19: China’s first 14,000 m³ B-type LNG bunkering vessel was delivered.

August 2024

• Aug 1: The "Natural Gas Utilization Management Measures" came into effect nationwide.
• Aug 2: The State Council issued the "Work Plan for Accelerating the Construction of the Dual Carbon Control System."
• Aug 8: Three ministries issued the "Action Plan for Strengthening the Carbon Peak and Carbon Neutrality Standard and Measurement System (2024–2025)."
• Aug 8: Construction began on the Guangxi LNG outbound pipeline loop line.
• Aug 11: The "Opinions on Accelerating the Comprehensive Green Transformation of Economic and Social Development" was released.

September 2024

• Sep 2: China’s first high-proportion hydrogen blending trial in urban gas was successfully conducted in Zhejiang.
• Sep 9: The second phase of the Tianjin LNG terminal was commissioned, reaching a total capacity of 12 million tonnes per year.
• Sep 27: The "Deep Sea No. 1" Phase II gas project was commissioned in the South China Sea.
• Sep 29: The Xinjiang section of the West–East Gas Pipeline IV was commissioned.
• Sep 29: The Huizhou LNG terminal began commercial operation.

October 2024

• Oct 24: The National Development and Reform Commission issued the "Work Plan for Improving the Carbon Emissions Statistical Accounting System."

November 2024

• Nov 8: The 14th National People’s Congress Standing Committee passed the Energy Law, effective January 1, 2025.
• Nov 26: The Nanpu 1 offshore gas storage facility in Bohai Bay was commissioned.

December 2024

• Dec 2: The China–Russia East gas pipeline was fully completed, increasing annual capacity to 38 billion cubic meters.
• Dec 5: The CPC Central Committee and State Council issued opinions on new urban infrastructure and price reforms.
• Dec 11: China’s first large floating LNG liquefaction unit "NGUYA FLNG" arrived in Zhoushan for outfitting.

January 2025

• Jan 7: The National Development and Reform Commission issued the "Guidelines for Building a Unified National Market (Trial)."

February 2025

• Feb 16: The eastern section of the Sichuan–East Gas Pipeline II advanced, strengthening the national backbone network.
• Feb 20: The Deep Earth TACO-1 Well was completed at a depth of 10,910 meters, setting an Asian record.
• Feb 24: The D-tank of the Jinwan Phase II project was successfully filled, marking the world’s largest single-tank LNG storage capacity in the Greater Bay Area.
• Feb 28: The "Oil and Gas Infrastructure Planning and Operation Management Measures (Draft for Comments)" was released.

March 2025

• Mar 13: The Ministry of Finance issued the "Clean Energy Development Special Fund Management Measures (2025–2029)."
• Mar 25: The National Energy Administration held the 2025 National Oil and Gas Infrastructure Planning and Pipeline Protection Conference.
• Mar 27: The Ban Shen 37 gas storage facility began drilling, marking the start of China’s first vertically integrated gas and oil storage facility.

April 2025

• Apr 2: The CPC Central Committee and State Council issued opinions on improving price governance mechanisms.
• Apr 8: The "Oil and Gas Pipeline Facilities Fair Access Supervision Measures (Draft for Comments)" was released.

May 2025

• May 13: The "Deep Earth Project: Sichuan–Chongqing Gas Base" achieved a new breakthrough with the Tiebei 1-HF Well.
• May 20: The 29th World Gas Conference (WGC2025) opened in Beijing.

June 2025

• Jun 25: The "Deep Sea No. 1" Phase II project in the South China Sea was fully commissioned.
• Jun 26: The West–East Gas Pipeline IV was fully completed, bringing China’s total gas transmission capacity to over 400 billion