2011 was a pretty horrible year for the stock price of Alpha Natural Resources (NYSE: ANR). However, growing cash flows and falling stock prices usually present an increasingly attractive picture from a value perspective. Despite the news that low natural gas prices are hurting coal producers, it's still worth looking into and drawing my own conclusions.

Company snapshot:

Market Cap $4.7 billion
Cash $575 million
Total Debt $3 billion
Forward P/E 18.5
Price-to-Book Ratio 0.6
Recent Price 20.76
Dividend Yield N/A

Source: S&P Capital IQ.

Alpha Natural Resources owns about 150 coal mines. The company is the fifth largest global supplier of coal and the third largest supplier of metallurgical coal in the world. With 25 million to 30 million tons of export terminal capacity on the East Coast of the United States and through the Gulf of Mexico, the company has plenty of export capacity to serve the rest of the world.

On the supply end of things, Alpha acquired Massey Energy Co. last June. In addition to increasing Alpha's reserve base and production capacity, the acquisition also has the potential to generate annual synergies of $220 million to $260 million by mid-2013, which should have a noticeable effect on the company's operating margin.

The demand side
With any resource provider, it's important to note the drivers of demand in the future. With coal, the main factors are electricity generation and steel production. As a major player in the coal export market, Alpha benefits from the growth of countries such as China and India, two of the main importers of coal. China consumes more currently, but India's demand is likely to grow faster because it is working off a smaller base. Either way, both countries continue to drive coal demand growth.

While the low price of natural gas continues to increase the likelihood of natural gas power plants replacing older coal-fired plants here in the U.S., the story is very different in the rest of the world. Globally, electricity demand is predicted to grow by 90% from 2008 to 2035, representing 4,160 gigawatts of additional generation capacity.

Along that growth trend, coal is projected as the fastest growing source of fuel in 19 of the 26 years between 2010 and 2035. Globally, coal is very much a major fuel and will remain that way for a very long time.

As a major player in the global market for metallurgical coal, steel demand is also very important. As of October, worldwide steel consumption was forecast to grow 6.5% in 2011, followed by another 5.4% increase in 2012 according to The World Steel Association. This is despite lagging developed markets. In the five years from 2007 to 2012, developed markets have actually seen a decrease in steel consumption of 15%, versus the developing markets' increase of 44%.

Foolish bottom line
As a major player in the coal export market, Alpha Natural Resources is positioned to take advantage of growth in developing markets through its exposure to the growing electricity generation and steel production in countries like India and China. If coal demand stays strong worldwide, the company is poised to benefit.

Looking for more 2012 stories that deserve your attention? Check out The Motley Fool's brand new report, " The Motley Fool's Top Stock for 2012 ." It highlights a company that is revolutionizing commerce in Latin America. You can get instant access to the name of this company for free.