http://news.discovery.com/tech/alternative-power-sources/seawater-alternative-jet-fuel.htm
The answer, according to Dorner, is a modified version of the chemical reaction known as the Fischer-Tropsch process.
Typically Fischer-Tropsch starts with carbon monoxide and hydrogen and, using metal catalysts and heat, ends with a mixture of methane, waxes and synthesis gas (syngas), which can then produce fuel or plastic.
Fischer-Tropsch is expensive and energy-intensive, which often limits its usefulness. One of the few times it has proven economical was using solid coal to produce liquid fuel for World War II Germany.
Instead of coal, Dorner and his colleagues want to use the carbon dioxide dissolved in seawater (140 times the amount found in the atmosphere) and hydrogen stripped from water as the base materials for the reaction.
http://simple.wikipedia.org/wiki/Fischer-Tropsch_process
The Fischer–Tropsch process (or Fischer–Tropsch Synthesis or F-T) is a set of chemical reactions that turn a mixture of carbon monoxide gas and hydrogen gas into liquid hydrocarbons (fossil fuels like gasoline or kerosene). The F-T process has received attention for many different reasons, like a way to make diesel low in sulfur.
http://www.newscientist.com/article/dn17632-how-to-turn-seawater-into-jet-fuel.html
Dorner and colleagues found that using the usual cobalt-based catalyst on seawater-derived CO2 produced almost entirely methane gas. Switching to an iron catalyst resulted in only 30 per cent methane being produced, with the remainder short-chain hydrocarbons that could be refined into jet fuel.
Heather Willauer, the navy chemist leading the project, says the efficiency needs to be much improved, perhaps by finding a different catalyst.
http://defensetech.org/2012/10/02/converting-sea-water-to-navy-jet-fuel/
JP-5 is what fuels Navy jet fighters and results in multiple fuel transfers to aircraft carriers to maintain their onboard fuel stock. Producing that fuel from the abundant sea water would save the Navy from executing those sometimes risky transfers.
“The potential payoff is the ability to produce JP-5 fuel stock at sea reducing the logistics tail on fuel delivery with no environmental burden and increasing the Navy’s energy security and independence,” said Heather Willauer, a research chemist with NRL.
Navy officials estimate the process used to convert the seawater to fuel would cost the Navy between $3 and $6 per gallon.
And to something related,not sure if legit.
http://auto.howstuffworks.com/fuel-efficiency/alternative-fuels/salt-water-fuel.htm
You may have heard about an invention created by a 63-year-old named John Kanzius that claims to create an alternative fuel out of salt water. Through sheer serendipity, Kanzius, a former broadcast engineer, found out something incredible — under the right conditions, salt water can burn at high temperatures……
…..During his first test, however, he noticed a surprising side effect. When he aimed the RFG at a test tube filled with seawater, it sparked. This is not a normal reaction by water.
Kanzius tried the test again, this time lighting a paper towel and touching it to the water while the water was in the path of the RFG. He got an even bigger surprise — the test tube ignited and stayed alight while the RFG was turned on.
News of the experiment was generally met with allegations of it being a hoax, but after Penn State University chemists got their hands on the RFG and tried their own experiments, they found it was indeed true. The RFG could ignite and burn salt water. The flame could reach temperatures as high as 3,000 degrees Fahrenheit and burn as long as the RFG was on and aimed at it.