In Qatar, executives at Sasol, a chemical and synthetic fuels company based in South Africa, and a partner, Qatar’s state-owned oil company, are betting that natural gas, which is abundant in Qatar, will become the dominant global fuel source over the next 50 years, and that oil will become scarcer and more expensive as global demand for transport fuels grows.
Sasol believes so strongly in the promise of this technology that it recently announced plans to spend up to $14 billion to build the first gas-to-liquids plant in the US, in Louisiana, supported by more than $2 billion in state incentives. A shale drilling boom in that region in the last five years has produced a glut of cheap gas, and the executives say Sasol can tap that supply to make diesel and other refined products at competitive prices. It is a very risky proposition. Royal Dutch Shell’s giant Pearl plant in Qatar cost the company $19 billion and has been plagued with unexpected maintenance problems. Competitors have had their own problems in the same arena.
