Thermal flow characteristics and the methane conversion reaction in a low power arc plasma reactor for efficient storage and transport of methane, which is the main component of shale gas, were simulated. The temperature and velocity distributions were calculated according to the type of discharge gases and arc current level by a self-developed magnetohydrodynamics (MHD) code and a commercial ANSYS-FLUENT code; the transport of chemical species was analyzed as including the chemical reactions of methane conversion. The simulated results were verified by the comparison of calculated and measured arc voltages with permissible low error as under 4%. Three C2 hydrocarbon gases with ethane (C 2 H 6 ), ethylene (C 2 H 4 ), and acetylene (C 2 H 2 ) were selected as the converted species of methane from experimental data. The mass fraction of C2 hydrocarbons and hydrogen as the product of the conversion reaction at the reactor was also calculated. Those values show good agreement with the actual experimental results in that the major conversion reaction occurred in C 2 H 2 and hydrogen, and the conversions to C 2 H 6 , C 2 H 4 , and hydrogen were minor reactions of methane pyrolysis conversion.