Engineers at The Ohio State University in the US devised a process that transforms shale gas into products such as methanol and gasoline - all while consuming carbon dioxide.
The process can also be applied to coal and biomass to produce useful products, researchers wrote in the journal Energy & Environmental Science.
Under certain conditions, the technology consumes all the carbon dioxide it produces plus additional carbon dioxide from an outside source, they said.
The same team has discovered and patented a way with the potential to lower the capital costs in producing a fuel gas called synthesis gas, or "syngas," by about 50 per cent over the traditional technology.
The technology, known as chemical looping, uses metal oxide particles in high-pressure reactors to "burn" fossil fuels and biomass without the presence of oxygen in the air. The metal oxide provides the oxygen for the reaction.
"Renewables are the future. We need a bridge that allows us to create clean energy until we get there - something affordable we can use for the next 30 years or more, while wind and solar power become the prevailing technologies," said Liang-Shih Fan, who led the project.
The engineers also developed chemical looping for production of syngas, which in turn provides the building blocks for a host of other useful products including ammonia, plastics or even carbon fibres.
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