Thick Pleistocene fine-grained rocks in the central Qaidam Basin, China, are regarded as the principal source rocks for microbial gas there. Here, for the first time, a detailed investigation on the organic geochemistry and petrology of this sedimentary sequence is presented. Two different, immature, lacustrine source rocks facies are present in the study area. Organic facies A samples with high TOC (4.1–25.3 wt%) and TS (1.5–3.7 wt%) contents mainly developed under a suboxic to anoxic freshwater column at the lake margins. This shallow water fluvio-lacustrine facies, accounts for only a small proportion of the whole sedimentary sequence, but has the highest petroleum generation potential. In contrast, organic facies B samples having lower TOC (0.5–1.1 wt%) and TS (0.14–1.0 wt%) contents were deposited in a more oxic, brackish-lacustrine water body. However, exceptionally, anoxic conditions were present in sediments that were sealed by algae mats.

The majority of the interval is comprised of gas prone, mixed type II-III kerogen derived mainly from aquatic plants. Organic facies A is interpreted to be derived from abundant macrophytes (e.g. non-marine algae, submerged angiosperms) around the lake margin. By contrast, the organic matter in organic facies B mainly stems from saltwater algae, with some additional bacterial contribution. Terrestrial higher plants is subordinate in both organic facies. The organic carbon accumulation rate was high compared to organic matter-rich Quaternary marine sediments. Cold and dry climate conditions and high burial rates favored methanogenesis via carbonate reduction in the sediments.