Abstract: Natural gas hydrate is a new potential energy, but how to effectively produce the gas from hydrate deposits remains a hot research topic. The production efficiency and economic feasibility of gas production from hydrate deposits at Shenhu area on the northern continental slope of South China Sea have not been thoroughly investigated so far. In this paper, a physical model is constructed for producing gas from Shenhu hydrate deposits through a vertical well. The production potential has been numerically simulated using the TOUGH+HYDRATE simulator with parameters from the drilling site of SH2 in the area. The economic feasibility for hydrate exploitation at the Shenhu is evaluated using both the absolute criteria of hydrate dissociation rate and gas production efficiency and the relative criteria of water production and the volumetric ratio of gas to water. In the whole course of mining simulation, ice obstacle did not appear, and secondary hydrate was not observed, both the hydrate dissociation rate and gas production rate at the well decreased continuously, and even had a jumping attenuation at time of 1300 d since the production got started. But the water production had a continuous increase and the volumetric ratio of gas to water remained at low level. The research shows that producing gas from Shenhu hydrate deposits through a simple vertical well is not economically feasible.