However, rising steel costs, the shortage of skilled labour and last month’s election of ultraconservative Iranian President Mahmoud Ahmadinejad could stop Sasol from achieving its goal of setting up an Iranian GTL plant.

New Sasol CE Pat Davies said on Friday that the company was unlikely to make a decision on a potential Iranian gas-to-liquids project in “the next year or so”, Business Day reported.

Sasol would wait and watch how relations between Washington and Tehran developed, Davies said.

Iran was expected to be the site of Sasol’s third gas-to-liquids plant after Qatar and Nigeria, where projects are already under way.

Meanwhile, Davies told Business Day that talks in Australia about a possible gas-to-liquids venture were progressing at a slower pace than expected, but the Australians remained “very keen”.

Speaking from Perth, locally based Sasol Chevron representative Tony Pytte said the company had been quietly working away in Australia for several years.

"We've been examining the opportunities here for a few years," he said.

"The federal and state governments have been very supportive, so the issues are commercial. It's a matter of making a good deal with the right gas suppliers. We are talking to suppliers now, but the discussions are confidential."

But GTL projects were massive and it could still be several years before a project was up and running, according to Pytte.

GTL provides a clean-burning, low-emission diesel fuel. Diesel offers lower greenhouse gas emissions than gasoline but conventional diesel has high sulphur and particulate emissions.

However, GTL overcomes these problems, and with diesel technology continually improving and the need to reduce greenhouse gas emissions becoming more urgent, GTL has a bright future, according to Pytte.

While the capital outlay to develop a GTL project was higher than that involveed in developing an oil-to-liquid facility, the GTL process was a lower cost process, as natural gas was cheaper than oil, he said.

Oryx, a $900 million GTL venture developed by Sasol and Qatar Petroleum and Sasol of South Africa, is on schedule to begin production in 2006.

It will initially produce 34,000 barrels a day and will eventually expand production to 100,000 barrels a day.

Qatar is investing billions of dollars in clean GTL technology.

Royal Dutch/Shell Group and Exxon Mobil are also developing GTL operations in Qatar. Shell's Pearl project aims to produce 70,000 barrels a day of clean GTL distillates by 2009, doubling in size later, while Exxon Mobil has signed a preliminary accord for a plant to produce 154,000 barrels a day starting in 2011.

Market analysts say that these products will be sold in Europe, the US and Asia, where they will be blended with other fuels to improve overall quality, or will be used by specialist transporters, like inner-city bus fleets, that are legally required to cut emissions, according to an International Herald Tribine report.