Shell considers natural gas-to-diesel facility in La.

Royal Dutch Shell is considering building a giant plant in Louisiana that would convert natural gas into diesel fuel, The Wall Street Journal reports, citing several people familiar with the company’s plans. The plant, which could cost more than $10 billion, would be similar in size to Shell’s Pearl gas-to-liquids facility in the Mideast nation of Qatar, the unnamed sources say. Pearl, which went into operation last June, turns natural gas into enough diesel to fill more than 160,000 cars a day. Shell declined to comment on its plans. The Anglo-Dutch company is expected to take up to two years to develop detailed engineering plans to determine if the plant is economically viable before submitting the project for approval by the company’s board. Shell’s plans are the latest sign that companies are seeking new ways to exploit extensive natural-gas discoveries in the United States. The boom in gas production from shale has sent natural-gas prices down 50% over the past year to slightly more than $2 per million British thermal units, the lowest level in a decade. Diesel prices, meanwhile, are near a record high, up 4% from a year ago. In September, South Africa’s Sasol Ltd. announced it was undertaking an 18-month feasibility study for a $10 billion gas-to-liquids facility adjacent to its existing chemical plant in Calcasieu Parish. Shell considered locating the facility in Texas and Louisiana but opted for the latter because the state offered better incentives, a person familiar with the matter says. The diesel produced at the plant could be exported to Europe and Latin America.