Diesel and jet fuel are usually made from crude oil. But with oil prices rising even as a glut of natural gas keeps prices for that fuel extraordinarily cheap, a bit of expensive alchemy is suddenly starting to look financially appealing: turning natural gas into liquid fuels. A South African firm, Sasol, announced Monday that it would spend just over 1 billion Canadian dollars to buy a half-interest in a Canadian shale gas field, so it can explore turning natural gas into diesel and other liquids. Sasol's proprietary conversion technology was developed decades ago to help the apartheid government of South Africa survive an international oil embargo, and it is a refinement of the ones used by the Germans to make fuel for the Wehrmacht during World War II. The technology takes 'a lot of money and a lot of effort,' said Michael E. Webber, associate director of the Center for International Energy Environmental Policy at the University of Texas, Austin. 'You wouldn't do this if you could find easy oil,' he said. But with the huge spread between oil and gas prices, and predictions of oil topping $100 a barrel next year, the conversion technology could be a 'a money-maker for whoever is a first mover in that space.' Several other companies have intermittently tried to make liquid fuels from natural gas or coal. For example, the energy company Baard has been planning a coal-to-liquids plant in Ohio but has not been able to pull the pieces together, and Peabody Coal has discussed a similar plant. Sasol figures that the natural gas needed for a gallon of diesel, plus operating costs, comes to about $1.50 a gallon. In comparison, a gallon of diesel made from crude oil now costs more than $2, even before refining, and many forecasts are for the price of oil to go higher. But there is a hefty cost of building the chemical plant to do the conversion, which might run over $1.5 billion for a new Canadian plant that would handle 40,000 barrels a day. The calculations also exclude another cost: greenhouse gas emissions, which may be higher for a conversion plant than a typical refinery, depending on how the work is done. A barrel of oil has historically cost one to two times as much as the equivalent amount of energy from natural gas. But right now, vast supplies of natural gas from shale formations in North America have driven prices down, so oil is triple the price of the gas equivalent. The new ratio creates 'a very attractive economic option,' said Lean Strauss, senior group executive at Sasol. 