The United States has a big problem. It may seem like a nice problem to have, but it’s a serious problem nonetheless.

Our country simply has too much natural gas on its hands.

#-ad_banner-#Thanks to the shale gas revolution, tapping into productive new seams has become quite easy for the hundreds of public and private gas producers around the country.

But as I remind readers of my newsletter, Scarcity & Real Wealth, just as scarcity creates wealth, abundance creates the opposite effect. Many firms are curtailing their natural gas production plans because prices are just too low, mothballing previously active drilling platforms.

Of course, the greatest panacea to flagging prices is higher demand. Industry players are now drawing up plans to utilize natural gas in new ways. In addition to its already-strong presence in the power generation industry, natural gas is also becoming a key player in our nation’s export picture, and can even be found in more trucks that have been retro-fitted to use natural gas a fuel.

Yet there’s another potentially huge source of demand that is just now coming into focus. It’s called gas-to-liquids (GTL), and by some estimates could generate so much demand for natural gas that all of those mothballed gas platforms will be corralled back into production.

I’ll spare you a deep technical discussion. In short, converting natural gas into a liquid (i.e. gasoline, diesel, etc.) is done through a three-step process that extracts unneeded molecules and distills the remainder into a clean and pure liquid that has the same exact chemistry as gasoline or diesel fuel.

GTL isn’t a new technology. Plans to turn natural gas into diesel fuel and gasoline have been around for nearly seven decades. But few had interest in exploiting this technology. Yet in recent years, two new developments have occurred. The GTL technology has improved, and natural gas prices have plunged. (Equally important, natural gas is so abundant that it’s likely to stay competitively priced even as demand starts to build).

Consider these two numbers: $4 and $25. Diesel fuel currently costs around $4 per gallon, and thanks to the changing dynamics of GTL, one company is poised to start producing diesel fuel for just $25 a barrel. There are 42 gallons in every barrel of oil, which means that a barrel of diesel fuel is worth $168 at the retail level, but can be produced for just $25.

If natural gas prices doubled, then GTL still makes sense. If natural gas prices tripled, GTL still makes sense. Better still: using natural gas instead of crude oil to make diesel fuel is better for the environment. The fuel burns more cleanly and produces less greenhouse gas pollution. This is some pretty compelling stuff.

The biggest backer of GTL technology is a little-known company based in Johannesburg, South Africa, named Sasol (NYSE: SSL). The company may not be well-known here in the United States, but in parts of the world that are moving quickly to capitalize on massive beds of natural gas, Sasol is already a household name.

For example, the company is currently constructing multi-billion GTL complexes in Nigeria, Uzbekistan and Qatar, and in just a few short years, it will be producing hundreds of thousands of gallons of diesel fuel and gasoline. Could China be next? That country is said to be sitting on shale gas reserves that may be 50% larger than our own massive amount of untapped gas.

Here’s why Sasol is about to become a household name in the United States. Plans are afoot to build a massive GTL facility in Louisiana that will be three times larger than Sasol’s next-largest GTL complex (in Qatar). As a point of comparison, the Qatari plant already tosses off more than $250 million in operating cash flow. The U.S. plant, if it comes online later in this decade, will be significantly more profitable.

By the end of fiscal (June) 2007, Sasol was still seen as a minor player on the global energy stage. The company had around $11 billion in annual revenue, meaning it wasn’t even among the top 50 of the world’s energy producers. Yet as the company grows, it’s climbing up the ranks. Sales hit $15 billion by fiscal 2009, and $20 billion by fiscal 2011, and once Sasol’s global GTL plans reach fruition, we’ll be looking at annual revenues exceeding that.

For dividend investors, the picture looks even better. Right now, Sasol pays two dividends a year (a regular practice for international companies). Based on the two most recent payments, the stock has a trailing yield of about 4.1%. That’s pretty enticing on its own, but as Sasol’s new facilities begin to come online, expect those payouts to climb further — giving investors who buy in at today’s prices an even higher yield.

P.S. There’s another opportunity I’m telling my Scarcity & Real Wealth readers about — one that has the potential to make investors as much as 189% profits in as little as three months. It all has to do with a “hated” company in an industry most investors have “left for dead.” But insiders are quietly talking about a success story that’s quietly brewing below the surface. To get the details, click here.