Reacting CO2 and ethane to synthesize value-added oxygenate molecules represents opportunities to simultaneously reduce CO2 emissions and upgrade underutilized ethane in shale gas. Herein, we propose a strategy to produce C3 oxygenates using a tandem reactor. This strategy is achieved with a Fe3Ni1/CeO2 catalyst (first reactor at 600-800 °C) for CO2-assisted dehydrogenation and reforming of ethane to produce ethylene, CO, and H2, and a RhCox/MCM-41 catalyst (second reactor at 200 °C) enabling CO insertion for the production of C3 oxygenates (propanal and 1-propanol) via the heterogeneous hydroformylation reaction at ambient pressure. In-situ characterization using synchrotron spectroscopies and density functional theory (DFT) calculations reveal the effect of Rh-Co bimetallic formation in facilitating the production of C3 oxygenates. The proposed strategy provides an opportunity for upgrading light alkanes in shale gas by reacting with CO2 to produce aldehydes and alcohols.