This process has been around for a while but wasn't economical at low oil prices:

http://en.wikipedia.org/wiki/Gas_to_liquids

I question the $20/bbl claim. Seems to me there might be a zero missing when you add in all the costs, such as transportation of NG to the refinery, not to mention building a refinery capable of commercial scale production.

This is the same process as coal-to liquids actually, with a few extra steps:

http://www.worldcoal.org/coal/uses-of-coal/coal-to-liquids

Liquification will help fill the gap between oil and whatever come next, but as a replacement for oil it suffers from the same problem of finite supply. I haven't seen any hard numbers, but my guess is you'd replace 20% of oil, which is pretty good until you consider that gas to liquids competes with NG as a home heating source. That's not to say it won't be used where practical, but I think the long term approach will be coal to liquids using nuclear energy as a power source. Coal is more accessible than NG and once you stop using it to generate electricity even more becomes available.

The common factor in all these scenarios is the attempt to rescue the private automobile. There's a lot of vested interest in keeping this technology alive as long as possible, but in the end I believe the automobile will be replaced by high speed rail serving dense urban environments. Electric cars will probably be used in a local setting, but for mass transportation automobiles are just too inefficient when you add up all the costs. Just the cost of building and maintaining roads is becoming prohibitive, then there's insurance, the medical and health costs, the services needed to support it - the list goes on and on. Tokyo is a good example of what the future might look like. You don't need a car to get around there, in fact you can't even own one unless you have a private parking space. No overnight street parking in Tokyo. Not enough room. Pointless driving there anyway - you just sit in traffic all day.

ebear