China’s Gas Output Rivals Iran's as Shale Push Accelerates Production
The rise in China’s gas production, now exceeding that of Qatar and of Australia, is also limiting growth in its LNG demand.
A drilling operation in China’s Shanxi Province on the western Ordus Basin, known for its coalbed methane and tight-gas reserves.
Source: Bjmcse for Dreamstime.com.
China’s shale and other unconventional developments in the southwest Sichuan and northern Ordus basins are widely credited as key drivers behind the country’s natural gas production reaching all-time highs in 2025, rivaling those of Iran.
China’s domestic natural gas production rose 7.1% year on year in November 2025 to 22.1 Bcm, as PetroChina and Sinopec’s Sichuan shale projects achieved higher-than-expected production volumes, helping to limit demand for LNG imports, Kpler Insight reported in January, citing China’s National Bureau of Statistics (NBS).
Though as of mid-March NBS had yet to publish year-end results, Kpler forecast that the country’s total gas production for the 12 months ending in December 2025 would reach 263 Bcm, in line with the government’s 14th Five-Year Plan.
If achieved, that level would be comparable to Iran, which produced 262.9 Bcm of natural gas in 2024, ranking third globally behind the US and Russia, according to the UK's Energy Institute, whose 2024 data also ranked China’s production ahead of Qatar and Australia.
Given such growth, Kpler revised its 2026 gas production forecast for China upward by 6% to 278.5 bcm year on year, as the country’s 15th Five-Year Plan aims to boost output from Sichuan Basin shale gas by 5.4 Bcm, coalbed methane (CBM) and tight gas in Shaanxi in the eastern Ordus basin by 2.2 Bcm, and CBM and tight gas in Shanxi in western Ordus by 2.4 Bcm.
Projects subsidized by China’s National Energy Administration are expected to grow Sichuan's contribution to national gas production gains by more than 40%, according to Kpler and Japanese business media Nikkei Asia.
Key projects include:
CNPC’s southern Sichuan Shale Gas Field, China's largest shale-gas base, has produced a cumulative 100 Bcm since the start of industrial production in 2014 through September 2025, according to China News Service (CNS). The addition of 237 wells between January and August 2025 increased output to 48 million m3/D, CNS reported.
As a result of the Sichuan-Chongqing Expansion, regional gas output exceeded 83 Bcm (vs. an 82 Bcm target), with shale gas contributing 27 Bcm. Completion of the first section of the East Gas Pipeline II has also enabled more Sichuan gas to reach market, according to the private commodity data group SunSirs.
Fitch Solutions noted that Sinopec’s Chuanxi Phase 1 ultradeep shale project is expected to bring online an additional 1.8 Bcm per year of production.
China's gas production is expected to grow further to 300 Bcm by 2030, the end of China’s 15th Five-Year Plan, Nikkei Asia reported, citing forecasts by a CNPC think tank.
China’s annual domestic gas production levels (Bcm) by major province. Note: 2025–2026 are forecast production levels.
Source: NBS, Kpler Insight.
Kpler forecasts that China’s demand for LNG imports will continue to decline in 2026, as rising domestic gas production in the Sichuan and Ordus basins offsets marginal increases in pipeline imports. This is expected to displace around 0.6 million tonnes of LNG demand in Q2–Q4 2026, reducing total demand to 73.9 million tonnes.
Pipeline imports are expected to grow only marginally, constrained by limited new Russian capacity ramp-ups before 2027 and weaker flows from Central Asia.
As of November 2025,Chinese customs data indicated that Russia’s Power of Siberia 1 (PoS 1) led pipeline imports, delivering approximately 3.5 Bcm, up 0.8 Bcm year on year. Central Asian flows declined by around 0.3 Bcm as exporters such as Kazakhstan and Turkmenistan diverted more gas to meet rising domestic demand, according to Kpler.
