Understanding how new trends and business decisions are correlated can help investors recognize rewarding opportunities. For example, U.S. natural gas reserves are growing, drilling companies are pursuing cost-saving measures, and other firms are positioning to meet the growing demand in a young market that is on the edge of exploding.

Natural gas production is paving a new road
Range Resources (NYSE:RRC), Chesapeake Energy (NYSE:CHK), and EQT Corporation (NYSE:EQT) all operate branch offices in southwestern, Pennsylvania, self proclaimed Energy Capital of the East. Why? Because the heart of the Marcellus Shale, the most productive gas field in America, spans the region, state, and nearby borders. Given shale gas production increases and new forecasts, the self-proclamation may become a reality. In fact, Pennsylvania's Department of Environmental Protection recently stated that drilling firms' produced 1.4 trillion cubic feet of gas, double what was reported during the same time last year. This 50% production growth occurred within the Marcellus Shale, the most productive gas field in America. Even with Marcellus production expected to soar or remain at high levels in coming years, drilling firms will continue to find new ways to increase their bottom line.  

The road to savings
Even though drilling companies are more efficiently and effectively producing natural gas than in previous years, these operations are still capital intensive. And because of the infrastructure development and transportation necessary to recognize, explore, and drill well sites, drilling companies constantly look for cost-reducing measures.

A key solution is compressed natural gas, or CNG. CNG is a safer, cheaper, and environmentally friendlier alternative fuel derived from natural gas. Mark Karney, an alternative fuel director for General Motors' (NYSE:GM) Fleet and Commercial Division, said that CNG powered vehicles save between 40%-50% in daily operating costs while giving off 20%-30% less emissions than most other vehicles.

CNG is on the threshold of becoming a sustainable fuel source for the future.

An industry shift is now under way
Drilling companies continue to implement measures to capitalize on the CNG movement. For example, Chesapeake's goal was to convert 100% of its fleet to CNG by 2015, saving over $11 million in the process.  If it maintains its current pace, it will break the 80% mark by 2014. Additionally, according to its website, Chesapeake partnered with GE in 2012 to "develop infrastructure solutions that will help accelerate the adoption of natural gas as a transportation fuel." Peake Fuel Solution, a Chesapeake affiliate, hopes to generate cash streams by bringing the CNG technology to market once it is developed.

Range Resources is also making drastic changes. It recently struck a deal with GM and purchased a fleet that utilizes CNG. Even though it is headquartered in Oklahoma and operates well sites across America, 56% of all Range's CNG vehicles are operated within the Marcellus Shale region. Range's payback on the investment is only two years.

All else equal and using the aforementioned data, Range's cash flow two years from now will be 40%-50% higher in regard to the daily operating costs of its vehicles. Considering a 17 gallon tank (size of its GM truck tank), its 180 CNG operating trucks, and a $1 saving using CNG instead of orthodox gas (conservative estimate), Range will add $3,060 to its bottom line...each time the trucks are filled.

To date, Range's purchase is the largest single order of CNG pickups for GM. And moving forward, we will likely see more.

The opportunity
Even though less than 1% of all vehicles in America utilize CNG, investors should look for growth in the industry. For example, Both Ford and GM are ramping up research and production budgets to meet rising demand for the vehicles.

Perhaps the best entry level for investors, though, is through the CNG fueling stations. EQT seems to be best positioned to reap the benefits of the transformation. Not only does it run its vehicles on CNG and produce the natural gas like Chesapeake and Range, but EQT owns and operates a fueling station.

In December 2012, EQT sold over six times more CNG than in January the same year. Now, it is expanding its station size to meet the growing demand. This brief analysis does not even consider the numerous federal and state incentive programs available to companies that utilize CNG. For instance, EQT's CNG station was launched in part because of $700,000 made available through the Pennsylvania Department of Environmental Protection.

Natural gas is plentiful, drilling companies are looking to improve their bottom line, automakers are making new models, and government agencies are offering incentives. All of these items are correlated. By understanding the connection, investors can be first movers in an industry that could fuel their ambitious investing goals.

Brendan Marasco has no position in any stocks mentioned. The Motley Fool recommends General Motors and Range Resources. The Motley Fool has the following options: long January 2014 $30 calls on Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.