Russia, Iran and Qatar are the big three with the worlds largest natural gas reserves, Claxton said, and it takes massive gas reserves to support GTL infrastructure. Of the three, only Qatar offered stable, pro-Western investment policies, so the tiny Persian Gulf emirate became the focus for GTL projects.

Qatar initially had GTL agreements with six multinational oil companies, said Claxton, but three were canceled in 2005 and a fourth, with ExxonMobil, was canceled earlier this year, as it became clear that the countrys reserves were overcommitted.

At the same time, around the world, project costs rose rapidly, she continued. Sasols Oryx GTL project – with no lubes component – came on line in early 2007 at a cost of $1 billion. Shells 140,000 b/d Pearl project, the only other Qatar GTL project still standing, has started construction, but projected costs have risen from $6 billion to $18 billion. And Oryx is not running well. Its below capacity, said Claxton. So GTL isnt the oasis the lubricants industry expected.

Are GTL lubes projects likely elsewhere? In short, no, Claxton said. Russia has 25 percent of the worlds gas reserves, and Shell and Syntroleum have looked, but foreign investment there is hampered by corruption. Pipelining to Western Europe is a faster and cheaper way to monetize [Russias] gas.

Iran claims half of Qatars North Field, which Iran calls the Pars Field, the worlds largest gas field discovered in 1971. Iran wants to suck out the gas as soon as possible, and Iran has more gas than Qatar, said Claxton. But it has no major pipeline market. Tightened U.S. sanctions and political instability have hampered foreign investment. Pars Field development is likely to be pipeline or LNG, with no Western technology licensing needed, Claxton said.

Coal-to-liquids is also on the horizon and, like GTL, can produce high quality base stocks, Claxton continued. The United States, Russia and China have the largest proven recoverable coal reserves. But regulatory issues are a challenge in the United States, which has cheaper BTUs from other sources. China is the more likely source of CTL, commercialized by 2010 to 2015, Claxon said, and lubes production is likely.

GTL base stocks have faded, with only Shells Pearl plant in Qatar still promising 20,000 to 24,000 b/d of base oils around 2011. CTL is on the far horizon, around 2015. But about 65,000 b/d of Group II and III base oils from hydroprocessing are in the pipeline for the next 36 months, said Claxton.

In 2008, GS Caltex, Formosa Petrochemical, Pertamina/SK, and Petronas plants will come on stream. In 2009 Bapco-Neste and Chinese Petroleum Corp. plants are scheduled to open. And in 2010, expect Bharat-Oman and Mangalore RPL. Plus several new refineries are planned elsewhere, said Claxton. Even without GTL lubes, there is new, high quality base oil in the works.

But watch out for bad news about pipelines and liquefied natural gas ventures, she concluded. Any major setbacks for those avenues to monetize natural gas could spell better news for GTL.