What is coal rock gas (CRG), and why is PetroChina prioritizing its development in China's coal basins?

Coal rock gas (CRG) is an unconventional natural gas resource extracted from deep rock formations within coal basins—distinct from shallower coalbed methane—using horizontal drilling and hydraulic fracturing (fracking) technology. PetroChina is prioritizing CRG because it offers 'stronger growth potential than alternative domestic gas sources', with forecasts indicating it could produce 30 billion cubic metres annually by 2035—surpassing last year's shale gas output—and potentially account for over half of China's gas output growth, supporting Beijing's strategic goals of energy independence and supply security.

How does CRG development differ from earlier coalbed methane efforts in China, and what technological shift enabled its commercial viability?

Unlike coalbed methane—which disappointed due to high costs and low per-well output, contributing only 5% of China's gas—CRG is produced from deeper rock layers (up to 6,000 metres) using shale gas technologies, particularly hydraulic fracturing. This shift began in 2021 at the Jishen 6-7 well in the Ordos Basin's Daji field, where a 3,000-metre horizontal well drilled 2,200 metres underground achieved commercial output of 100,000 cubic metres per day, proving fracking's effectiveness for CRG and launching a broader drilling campaign.

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