OREANDA-NEWS. January 20, 2015. China's production of unconventional gas in 2014 totaled 4.9 Bcm, soaring 42% year on year, although this pace of increase will still fall short of official targets for 2015, data from the country's Ministry of Land and Resources.

Coalbed methane output rose 23.3% year on year in 2014 to 3.6 Bcm while shale gas production was 1.3 Bcm, expanding by over five times from 2013, the ministry said.

The shale gas output is just under the 1.5 Bcm that the ministry expected in September would be reached in 2014.

China has targeted shale gas output to hit 6.5 Bcm/year by this year, the end of the current five-year economic plan.

This is largely expected to be reached because of significant efforts by state-owned Sinopec and PetroChina at a few key projects, including the former's Fuling facility in central Chongqing municipality.

The MLR last year slashed the 2020 shale gas target to 30 Bcm/year, from a previous forecast of 60-100 Bcm, citing technological challenges.

But CBM is developing more slowly. The national output target for CBM is 30 Bcm/year by 2020, comprising 16 Bcm/year via coal seams and the rest coal mine methane.

While the government has pledged to introduce incentives such as higher subsidies and more favorable tax policies for CBM, progress has been slow.

While state-owned companies seem to be focusing more on shale gas at the moment, the issue of overlapping land rights for CBM drilling and that for coal mining has also been a major obstacle to development and is a longstanding complaint of foreign operators.

China's total 2014 gas output rose 10.7% year on year to 132.9 Bcm, with conventional gas output up 9.8% over the same period to 128 Bcm, the MLR said.

State-owned PetroChina's gas production last year rose 8.2% to 95.2 Bcm while rival Sinopec's gas output rose 7.2% to 20 Bcm.

Offshore producer China National Offshore Oil Corp. produced 11.8 Bcm of gas last year, up 23.6% from 2013, the MLR said.

In addition, Shaanxi-based state owned company Yanchang Petroleum also produced 600 million cu m.

China's total oil production last year was stable at 210 million mt, edging up 0.7% year on year.

The MLR said the focus going forward will be to sustain stable production growth, particularly at major oil producing areas such as Daqing, Shengli an Changqing.