Becoming the ‘new’ fuel of choice around the world

Energy investors need to remember three things to make incredible returns in the coming decades:

Asia, Asia, and Asia.

Asia is going to make energy investors rich. Specifically, India and China will. And more specifically, they'll make folks rich in natural gas. I know you've heard the "billions of people need this and that resource" argument before, but hear me out...

From 1997 to 2007, China's total energy consumption rose from 38 quadrillion British Thermal Units (BTUs) to 76 quadrillion BTUs, roughly equal to 74 trillion cubic feet of natural gas. However, coal supplied 75% of that energy, while natural gas contributed a scant 2%.

Japan and South Korea already consume trillions of cubic feet of imported natural gas per year. India became a net importer in 2004. China became a net importer of natural gas in 2007, and that's not going to change. The country wants natural gas to supply about 7% of its energy needs by 2015. Even if China's energy consumption remained flat (and it won't), it would need to add five trillion cubic feet of natural gas from somewhere.

The problem is, China produced just 2.7 trillion cubic feet of gas in 2008. To add five trillion cubic feet of supply, the country must TRIPLE its production... or look elsewhere. But it'll face a lot of competition for natural gas in Asia.

In 2008, China, India, Japan, South Korea, and Taiwan imported a combined 5.5 trillion cubic feet of natural gas. China's natural gas imports are up 53% from 2008. India's natty imports are up 23%. Annual growth in global demand jumped from 7.5% in 2009 to a predicted 17% in 2010.

While coal and oil are still huge parts of the Asian energy picture, natural gas is becoming the "new" fuel of choice around the world.

(The demand for natural gas isn't just for energy. According to Indian hedge-fund manager

We need to position ourselves to profit from that demand. At the very least, we should own shares of major oil companies like ExxonMobil, which is positioning itself to profit from Asia's voracious demand. But the sweet spot will be finding small companies in the right places.

At the S&A Resource Report, my plan is to find the most promising juniors – companies looking to discover energy supplies for China. With great teams working in far-away places, a few of those companies will make investors rich.