Methane is the lightest of the hydrocarbons, consisting of a single carbon atom bonded to four hydrogen atoms in a tetrahedral configuration. It is volatile, and tends to break down quite quickly by being oxidized, so presence of atmospheric methane is often considered to be an indication of the presence of life. However, methane can also be produced be non-biological processes such as volcanic activity. Methane is also an efficient greenhouse gas, contributes to global warming and may be a useful gas for the process of terraforming.
Methane is of particular interest for missions to Mars, as it may be possible to produce it in situ using locally-available raw materials. This would make it an ideal fuel for rovers and rocket engines.
Discovery in Atmosphere
In 2004, the Mars Express mission detected methane in the Martian atmosphere at a level of approx. 10 parts per billion. This was later confirmed by Earth-based spectroscopy. Methane is quickly decomposed in the martian atmosphere, so some source, either geologic or biological, is replenishing the gas.
Methane plumes have been detected over areas thought to have had water in the past. 
Synthesis of methane
Production of methane on the surface of Mars would likely be via the Sabatier reaction:
- CO2 + 4H2 ↔ CH4 + 2H2O
- The atmosphere contains a high proportion of carbon dioxide.
- Hydrogen could be obtained by electrolysis of indigenous water (although some schemes call for the hydrogen to be imported).
This process could also be used during a trip to or from Mars to scrub CO2 from a spacecraft atmosphere.
Uses for methane
Methane works well as a rocket fuel, and a number of LOX/methane fueled rockets are under development, including the XCOR XR5M15, Northrop Grumman TR408, the SpaceX Starship and Booster as well as the Blue Origin rockets.
Methane fuel cells have recently been demonstrated, and these would work well for powering rovers, semi-portable equipment or as backup generators. It can play an important part in an energy storage infrastructure.
- CH4 + heat → 2H2 + C