Natural gas start-up Tellurian (TELL 14.85%) has more than doubled in 2021, but could there still be enough upside potential ahead to justify the higher price tag?

In this Fool Live video clip, recorded Oct. 4, contributor Jason Hall discusses what investors should know before jumping in.

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Jason Hall: Tellurian, ticker TELL continually has been one of the most interesting businesses that are followed for the past two or three years. What is Tellurian? It's a start-up. Let's start there. This is a start-up, this is a business that does have some operations, but they are minimal and they're certainly not enough to pay its actual cost. This is a company that's attempting to build natural gas liquefaction and export facility in Louisiana.

Here's the idea. Coming out of the Permian Basin, we talked about that earlier with Diamondback (FANG 3.75%). There's a tremendous amount of natural gas. A lot of that gas is what they call stranded gas. There's not infrastructure in place to remove it and actually get it into the pipelines to use and there's not enough output to justify the expense of putting in the large infrastructure that you usually see for gas pipeline.

Tellurian is looking to try to bridge that gap and access a lot of that low-cost gas to bring it in to lower its production costs but to also meet the very real need for energy around the world. The bottom line is that we're going to need a tremendous amount more energy as the global middle-class continues to expand, we're looking at like a billion more people in the global middle-class over the next decade, the global population is going to grow by about a billion people. Draw your own conclusions there.

Natural gas is much lower profile in terms of particulars, these mosquito is like right in my face, got her actually, it's the girls that bite you, anyway, so much lower profile in terms of particulates and carbon impact in coal. Definitely better than using things like fuel oil to produce energy. There's a tremendous amount of demand. Also a lot of people don't realize that it's also really important feedstock for chemical manufacturing. It's a major feedstock for fertilizer. It's a major feedstock for car tires, other rubber products, plastics. You think about all of these COVID vaccines. A lot of those are being transported and they are being injected with plastic. It's really important in the global supply chain. Here's the risks.

These guys have got to find $20 billion-$30 billion to build this facility. They have now officially got enough long-term contracts for supply for natural gas to justify building the first phase. The next step is raising the capital. If the company can raise the capital, enormous this could be a 50-bagger potentially. I'm throwing big numbers out there they could be. This could also be a zero in a couple of years because they don't bring it enough cash flow right now to pay the bills. They have to sell stock to raise enough capital to build this facility.

But Charif Souki, one of the founders, he is the founder of Cheniere Energy (LNG 0.63%). This is a company that has been enormously successful. He was run out, he was actually pushed out of the business by activist investors led by Carl Icahn but his idea was to try to do better with Tellurian and somebody that has experienced incentive before, I think they're going to do it.