Sinopec, Asia's biggest downstream company, has received approval from China’s National Development and Reform Commission to build a 8,400-kilometer pipeline network carrying up to 30 billion cubic meters of gas per annum from the gas fields in northwest China to the southern and eastern provinces around Guandong.

The network is designed to send gas produced from Sinopec Group’s Zhundong coal-to-gas project in Xinjiang to end users in populous areas of southeast China. It will also carry unconventional gas from coal-bed methane and shale gas projects in northwest China.

China, the world's largest energy consumer, has made largely untested coal-to-gas technology a key part of its strategy to boost the use of cleaner fuels as it battles pollution in its big cities -- and therein lies the problem: coal-to-gas-technology uses large volumes of water and produces large amounts of carbon dioxide. Environmental groups have warned that coal-to-gas (CTG) and coal-to-liquid (CTL) projects will do little to cut carbon emissions or reduce pollution.

In a bid to allay concerns about the environmental risks of the process, projects will only be permitted in regions with sufficient water resources, the National Energy Administration said in July.