Applying an appropriate city gas source is important for reducing the costs of living and production, energy-saving, environmental protection and city long-term planning. According to the principle of value engineering (VE), the paper puts forward a model for selecting city gas source. The model includes identifying research object, function analysis, cost analysis and value analysis. The model mainly focuses on function analysis and a functional evaluation index system of gas source is constituted, the improved analytical hierarchy process (AHP) is used to determine the weights of the indexes for function coefficient calculation. Combining the technical and economic characters of gas sources, value index is formulated as the evaluation parameter to select the optimal scheme. An application case is studied using the model, and the selected gas source long-distance pipeline natural gas (LPNG) is suitable for the city.