Bloomberg: Shale Glut Becomes $2 Diesel Using Gas-to-Liquids Plants

Drivers are next in line to benefit from the U.S. shale boom.

Technologies that create motor fuels from raw materials other than oil, some drawing on techniques first commercialized in Nazi Germany, are poised to turn the glut of U.S. natural gas into energy for cars, trucks and planes.

A Chesapeake Energy Corp.-backed company and Oxford Catalysts Group Plc are planning U.S. factories to make diesel, gasoline and jet fuel from gas, which fell to a decade-low price this year. Their goal is to make motor fuels more cheaply and easily than oil-based products produced at giant refineries, and all within two years.

U.S. gasoline prices have jumped more than 125 percent since the end of 2008 as crude doubled to more than $100 a barrel. At the same time hydraulic fracturing processes, or fracking, helped gas producers unlock once inaccessible reserves in shale rock. That’s boosted output and driven down prices, sparking interest in using the surplus energy to fill fuel tanks.  MORE