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Biomass is considered as an important future renewable energy source in order to solve the problems of depletion of fossil fuels and their destructive influence on the environment. From among various biofuels which can be produced from biomass Synthetic Natural Gas (SNG) is expected to play an important role in fulfilling future world energy demand. This paper presents an exergy analysis of SNG production from a woody biomass feedstock based on indirect biomass gasification. In indirect gasification heat needed for endothermic gasification reactions is produced by burning char in a separate combustion section of the gasifier and subsequently the heat is transferred through a dividing wall to the gasification section. Steam is used as a gasifying medium. The advantages of indirect gasification are no syngas dilution with nitrogen and no external heat source required. The production process involves several process units, including biomass gasification, syngas cooler, cleaning and compression, methanation reactors and SNG conditioning. The process is simulated with a computer model using the flow-sheeting program Aspen Plus. The exergy analysis is performed for various operating conditions such as gasifier pressure, methanation pressure, and methanation temperature. The irreversibilities (internal exergy losses) of all process units are evaluated. The largest internal exergy losses occur in the gasifier followed by methanation and SNG conditioning. It is shown that exergetic efficiency of biomass-to-SNG process increases with increasing gasification pressure, methanation pressure, and decreasing temperature in the 1st methanation reactor.