How many times have you been driving along at night and noticed a large, bright, somewhat enigmatic flare in the distance, just burning away into the night and illuminating the industrial piping and framework underneath it?
It never failed to baffle me — how something that clearly packs a lot of energy is simply burned away into the atmosphere as a worthless byproduct of petroleum refinement.
If you look at the figures, the absurdity of the practice really comes into focus. We’re not just burning away a byproduct… We’re needlessly burning away a massive resource year in and year out.
And we’ve been doing it for decades.
According to World Bank estimates, across the world, more than 5.3 trillion cubic feet of natural gas worth more than $30 billion is vented and flared off each year — which amounts to a full quarter of the annual natural gas demand in the U.S. or one-third of Europe’s.
This isn’t just a minor issue — it’s an entire would-be industry literally going up in flames at refineries from Eastern Russia to Southern California.
Glaringly wasteful, poisonous to the environment, and fiscally demented, this was a problem just begging for a solution — and a solution is exactly what came.
It Once Powered the Nazi War Machine
It’s a technology known as gas-to-liquid (GTL). It uses the Fischer–Tropsch process to convert natural gas to highly versatile, highly practical fuels such as methanol, diesel, petrol, and synthetic crude.
And it’s not entirely new. Invented in Germany back in the 1920s, it was in such widespread use by the 1940s that this reconstituted fuel accounted more than 9% of Nazi war production.
Today, the products of this process are being used in everything from cars to airplanes.
The U.S. Air Force’s fleet of B-52 strategic bombers relies heavily on GTL-derived fuels, and it’s been used widely in civilian and commercial aviation as well.
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Today’s Waste… Tomorrow’s Fuel
However, as the earlier statistics clearly indicate, this process is not used nearly enough.
Today, legislation is already in place to virtually guarantee that moving forward, GTL plants will account for more and more of the natural gas you once saw flared off into the atmosphere.
In fact, by the year 2020, North Dakota — widely considered the nucleus of the shale revolution — is expecting to cut its flaring down to just one-third of current levels.
To do that, however, more GTL plants will be needed, and they will have to service a far greater number of smaller refineries — a trend brought on by the explosion of popularity in fracking over the last decade or so.
Well, one company has made it its business to see to this gradual transformation.
To help the process along, it’s pioneering the small-scale GTL facility and bringing this much-needed process to places it was never financially feasible before.
But here’s what’s really interesting: This isn’t some giant petro-tech company with a multi-billion dollar valuation and interests all across the sector…
This is a small-cap firm worth less than $400 million — not so small as to make this play long on volatility but small enough that the potential upside is substantial.
Christian DeHaemer, one of the best trend-spotters I’ve ever met and a world authority on emerging opportunities in the energy sector, has recently published an in-depth study of this company.
Everything from its business model to its bottom line to the underlying patterns driving the trends — he explains it all.
I recommend you take a look at his report immediately, because the way this thing could move, one more day might be one too late.
The report is free and available right now. Click here for instant access.
Brian Hicks
Brian is a founding member and President of Angel Publishing and investment director for the income and dividend newsletter The Wealth Advisory. He writes about general investment strategies for Tech Investing Daily, Wealth Daily and Energy & Capital. Known as the “original bull on America,” Brian is also the author of the 2008 book, Profit from the Peak: The End of Oil and the Greatest Investment Event of the Century. In addition to writing about the economy, investments and politics, Brian is also a frequent guest on CNBC, Bloomberg, Fox and countless radio shows. For more on Brian, take a look at his editor’s page.
