Mainland natural gas prices will need to catch up with international levels as imports rise, but the reform will take a long time, according to a senior energy official at the country's economic policy planner. As the mainland gas market rapidly develops, with multiple gas sources, pricing becomes an increasingly complex issue that needs to balance the interests of producers, importers and consumers, Hu Weiping, deputy director-general of the National Energy Commission's department of oil and natural gas said. The commission, part of the National Development and Reform Commission, was set up a year ago to better co-ordinate the country's energy policies. Mr Hu said gas price reform was high on the energy commission's agenda, but it would be a long process. 'Within a certain time, our gas price must be integrated with international prices, which are linked to international oil prices,' he said on the sidelines of the National People's Congress. 'Otherwise, discrepancies between domestic prices and import prices will create problems.' Mainland gas prices are state-regulated and are well below international levels, as Beijing wants to increase consumption of the cleaner-burning but more expensive fuel instead of coal, which accounts for some 70 per cent of the country's energy consumption. 'When we started building the first west-to-east pipeline and the Guangdong liquefied natural gas (LNG) terminal in 2002, our gas pricing was simple,' he said. 'But with rapid market development, we have multiple gas sources and numerous users ... we need to balance a lot of different interests.' The multiple sources include onshore and offshore conventional gas output from the country's three oil and gas companies, imports via pipelines or tankers in the form of LNG, as well as coal-bed methane extracted from domestic coal seams. Mr Hu said gas pricing for the second west-east pipeline, being built by PetroChina to import gas from Central Asia to southern and eastern China, is being studied by the energy commission's price department, and a mechanism may be announced by the end of this year or early next year. Meanwhile, he said, although international spot market gas prices had followed crude oil prices, which had fallen sharply since July, LNG prices, which are purchased in multi-decade contracts, might be different. 'Oil price's decline does not necessarily mean LNG prices will follow closely, as the latter's setting can be relatively independent,' Mr Hu said. China has had difficulty signing enough LNG purchase contracts in the past five years to feed the many gas import projects planned, as project developers balked at high prices after sellers tightened the linkage of LNG prices to oil prices owing to tight supply.