Abstract: The Paleogene oil and gas bearing system in the Xiangcheng Sag have the characteristcs that traps formed earlier, oil were generated and pools formed later. Oil and gas distribute vertically in the bottom part of the Jieshou and Wuyang formations and the lower part of the upper Yexian Formation, and horizontally in the Shangqiao inner slope fault-nose structure zone and Xianaiia fault steep slope acticlinal zone with the former being the most favorable prospective area in this region.