Anhydrous processing to convert methane into oxygenates (such as methanol), liquid fuels, or olefins uses an initiator to create methyl radicals. These radicals combine with sulfur trioxide to form methyl-sulfonate radicals. These radicals attack fresh methane, forming stable methane-sulfonic acid (MSA) while creating new methyl radicals to sustain a chain reaction. This system avoids the use or creation of water, and liquid MSA is an amphoteric solvent that increasing the solubility and reactivity of methane and SO.sub.3. MSA from this process can be sold or used as a valuable chemical with no mercaptan or halogen impurities, or it can be heated and cracked to release methanol (a clean fuel, gasoline additive, and chemical feedstock) and sulfur dioxide (which can be oxidized to SO.sub.3 and recycled back into the reactor). MSA also can be converted into gasoline, olefins, or other valuable chemicals.