Rystad Energy projects China coal-to-gas capacity to triple to 28 Bcm by 2030
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Rystad Energy projects China's coal-to-gas capacity will triple to 28 billion cubic meters per year by 2030, driven by low Xinjiang coal costs and energy security concerns. Most of the 20 Bcm/year under development is in Xinjiang, where project approvals have accelerated to under 12 months. The build-out is proceeding even as the government imposes carbon capture requirements on new plants.
Xinjiang Coal Cost Edge
Xinjiang province has become the hub for CTG expansion, with mine-mouth coal prices averaging 214 yuan ($30) per tonne, less than 40% of Inner Mongolia levels. Delivered gas to East China costs $9.1–$9.6 per MMBtu, generally below the average LNG import price. Existing plants are running at over 90% utilization, reflecting strong demand and the competitiveness of domestic synthetic gas against imports.
Accelerated Project Development
Approximately 20 Bcm per year of CTG capacity is currently under development, much of it in Xinjiang. Project approval timelines in the region have compressed from three years or more to under 12 months in several recent cases. Rystad estimates China's total CTG capacity will reach 9.4 Bcm/year by end-2026 and 28 Bcm/year by 2030, more than four times Austria's entire coal-produced annual gas demand.
Carbon Capture Conditions
Beijing is balancing CTG expansion for energy security with project-specific carbon and environmental requirements. The CHN Energy Zhundong development, a 2 Bcm/year plant scheduled to begin gas production in 2027, includes electrolytic hydrogen integration, wastewater recycling, and 550,000 tonnes per year of planned carbon capture. China has a well-established market for utilization-based carbon capture, though the scalability of permanent storage remains uncertain.
What's Next
The next CTG projects are set to receive approvals under the 15th Five-Year Plan's streamlined processes, with the first major output expected from Zhundong in 2027. It remains unclear whether the economics of decarbonized CTG will be bankable over the long term, even as the security imperative accelerates construction.
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Rystad Energy projects China coal-to-gas capacity to triple to 28 Bcm by 2030
