"Opening to both domestic and foreign companies, this is an important reform measure", Chinese Deputy Minister of Natural Resources Ling Yueming said at a news conference.
Foreign companies registered in China with net assets over $43 million will be eligible to obtain oil and gas mining rights, the deputy minister added.
The measure will go into effect 1 May and permits obtained for mineral resource mining will be valid for five years.
In the past, foreign companies could only enter the oil and gas industry by cooperating with Chinese firms, in particular state-owned enterprises such as the China National Petroleum Company and China Petrochemical Corp.