A process for the gasification of coal and other carbonaceous materials to produce a methane rich fuel gas includes the combination of the shift and methanation reactions in a single reactor system. A hot raw synthesis gas comprising methane, hydrogen, hydrogen sulfide, and oxides of carbon passes from a coal gasification system into a combined shift and methanation reactor system where the shift reaction between steam and the product gas adjusts the hydrogen/carbon monoxide ratio. Simultaneously with the occurrence of the shift reaction in the combined reactor system, carbon monoxide and hydrogen are converted to methane and water. Steam formed by the methanation reaction promotes the shift reaction to, in turn, produce the hydrogen necessary to carry out the methanation reaction. After purification to remove the acid gases, the methane rich product gas is reacted in a cleanup methanator in the presence of a nickel catalyst to reduce the carbon monoxide content and increase the methane content to the pipeline standards required for synthetic natural gas.