The Next Big Commodities Boom Is Happening Here
Think about how much money you would have made had you bought property in the Bakken Shale eight years ago…
#-ad_banner-#As recently as 2006, an acre of land in this desolate North Dakota region was selling for as little as $500. That means back then you could have purchased a 200-acre plot for no more than $100,000.
Then the “American Energy Boom” hit. Suddenly, acreage that was once thought of as worthless farmland instantly became invaluable as people became aware that the Bakken was home to massive amounts of untapped oil and gas reserves.
As a result, today that same 200 acres could be worth over $4 million…
Landowners weren’t the only ones who would have gotten rich on the deal either. Investors in companies exploring the Bakken were rewarded with small fortunes as floods of new capital poured into the region.
For example, Kodiak Oil & Gas (NYSE: KOG), one of the first companies to start drilling here, ran from $0.25 a share in 2009 to $11.81 today — a staggering 4,438% gain over that time.
It’s the same story for Continental Resources (NYSE: CLR) and Painted Pony Petroleum (TSX: PPY), two of the other major players in this group. While their gains aren’t nearly as impressive as Kodiak’s, both stocks still managed to return 500%-plus since bottoming in 2009.
That’s the power of commodities investing. All it takes is one resource discovery to propel a company — or, in some cases, an entire region — into complete economic prosperity. While such finds are rare, when they happen they often make those who got in early fabulously wealthy.
Today we want to share with you a discovery that, like the Bakken did a few years ago, is presenting early investors with an opportunity to make a small fortune in the commodities sector.
In fact, there is so much opportunity in this region that Dave Forest — StreetAuthority’s resident commodity expert — recently went on record saying that this place will likely be home to the first “$1 Trillion Boomtown.”
Dave explains the details of this “boomtown,” as well as how he came across it, in his most recent research report, Three Ways to Profit From the World’s First $1 Trillion Boomtown:
It was a tip from one of my contacts in the mining industry that led to my recent trip to this potential $1 Trillion Boomtown.
What I saw on this trip confirmed my suspicions that two commodity trends here are going to blow the local economy through the roof.
Specifically, in addition to incredible natural-gas prospects, this region has lately become one of the most desired places on the planet for copper and gold exploration and development.
I had the chance to helicopter over one of the project sites, providing a perspective on just how big these developments are.
As the shot below from the chopper shows, one company is building 12 miles of new road to access the mine. The company is also constructing over 70 miles of new power lines to connect this remote area to the regional grid.
Capital to develop these mining projects is already gushing in too. In July, a major $16 billion miner acquired a 75% interest in an enormous copper project here. Around the same time, one of the world’s top mining companies flew its head of exploration all the way from Australia to invest close to $15 million in the region.
But mining prospects aren’t the only thing this town has going for it…
This country is also prospering thanks to the same two commodities that created fortunes for investors in North Dakota’s Bakken shale just a few years ago: oil and natural gas.
Not only is this town situated in the center of massive new oil and gas deposits — it’s also located on the edge of a deepwater bay, giving cargo ships easy access to the ocean.
Once the infrastructure is completed, a recent Credit Suisse Global Equity Research report estimates that firms in this future boomtown will be able to produce natural gas for $4 per million BTUs (MMbtu).
And because of its prime location, companies in this region are strategically positioned to sell liquid natural gas (LNG) to high-value markets like Japan and Korea at prices up to $16.90/MMbtu.
That’s a stunning profit margin of over 300%.
That means for select drillers operating here, there’s a huge arbitrage opportunity simply because of this town’s geographic location.
So where, then, does that location happen to be?
Simply put, it’s a small remote town on the outskirts of eastern Canada. I’d give you the name, but I doubt it would do any good. Chances are less than 1 in 1,000 people knows about it.
But even though this town is relatively unknown, that hasn’t stopped companies working here from attracting the market’s attention. For example, one of Dave’s favorite picks in this space, Bellatrix Exploration (NYSE: BXE), has more than doubled its share price in the past 18 months…
But Dave thinks this rally has only just begun. Right now, Bellatrix owns 120,000 acres of prime real estate in this small Canadian coastal town. If Dave is right, each of those acres could contain billions of cubic feet of natural gas, most of which Bellatrix will be able to ship abroad at a substantial premium.
Those lease holdings are already proving to be wildly profitable too. During the first six months of 2013, Bellatrix posted a 100% success rate after drilling 26 wells.
To be fair, it’s unlikely that Bellatrix will continue to drill with such a high win rate. Even the best exploration and production companies are lucky if they can strike oil 33% of the time.
But it just goes to show you the opportunities to be had in this area. As it stands, this small Canadian town could be sitting on two of the biggest commodity trends of the next ten years. And like most commodities booms, these trends have the potential to make early investors incredibly wealthy.
There’s plenty more to say about this “$1 Trillion Boomtown,” but simply don’t have time to go into all the details in today’s issue. So to explain the specifics, I urge you to check out Dave’s brand new report. In it, he’ll tell you all about this “boomtown,” as well as give you the names and ticker symbols of several other companies he likes here — including one that is up 1,500% in the past 12 months alone. To get the name of this stock, or to simply find out more about the next big trend in commodities, follow this link.