The rapid growth in U.S. natural gas production over the past few years has radically transformed the nation's energy landscape, with many hailing the United States as the "Saudi Arabia of natural gas."

Not only is cheap and abundant shale gas benefiting America's manufacturers and other energy-intensive businesses, but it's also reducing the nation's reliance on foreign energy and contributing to an improvement in its trade balance.

In fact, the U.S. is now less reliant on foreign energy than at any time in the past quarter-century, in part because gas imports plunged to their lowest level in 25 years in 2013. Let's look at the main reason why, along with some of the companies that are driving -- and benefiting from -- this encouraging trend.

A gas drilling site in Pennsylvania's Marcellus shale. Photo credit: Flickr/Nicholas A. Tonelli.

U.S. gas imports plunge to 25-year low
According to a recent note from the U.S. Energy Information Administration, U.S. net imports of natural gas in 2013 fell 14% to 1,311 billion cubic feet, or Bcf, the lowest level since 1989. Meanwhile, U.S. natural gas production likely set a new record of 24,282 Bcf last year.

Total gas imports in 2013 fell 8% year over year to 2,883 Bcf, as pipeline imports decreased by 6% to 2,786 Bcf and liquefied natural gas imports decreased by 45% to 97 Bcf. Gas imports from Canada, which accounted for roughly 97% of total U.S. gas imports last year, decreased by 6% to 2,785 Bcf, while LNG imports from Qatar and Trinidad and Tobago fell by 78% and 38% from 2012 levels to 7 Bcf and 70 Bcf, respectively.

Gas imports fell last year primarily due to the strong growth in domestic natural gas production, the EIA said. Record U.S. gas production in 2013 was fueled primarily by rapid growth in Pennsylvania's Marcellus shale, a vast gas-rich shale formation that spans several states including Pennsylvania and West Virginia.

Why the Marcellus is growing so rapidly
Production from the Marcellus recently surpassed the 14 Bcf per day mark, up from less than 2 Bcf/d as recently as 2010. The play now accounts for more than a fifth of the nation's gas production. Energy companies are eager to drill in the massive shale formation due to its extremely low breakeven costs, which are significantly better than other shale gas plays such as the Haynesville and the Barnett.

For instance, Cabot Oil & Gas (NYSE:COG), perhaps the lowest-cost producer in the entire play, can generate triple-digit rates of return from its Marcellus wells with a gas price as low as $3 per MMBtu. Similarly, Range Resources (NYSE:RRC) requires a price of $4 per MMBtu to earn a roughly 105% rate of return, while Chesapeake Energy's (NYSE:CHK) most economical wells in the northern Marcellus earn a 117% rate of return at $4 gas.

Not surprisingly, as gas prices have surged over the past year, these low-cost Marcellus operators have reaped windfall profits. Cabot's first-quarter adjusted earnings more than doubled and its operating cash flow jumped 20% year over year, as its Marcellus production surged 44% year over year and its average natural gas price realizations rose 8.5%.

Similarly, Range's first-quarter profit jumped to $33 million from a net loss of $76 million in the year-earlier quarter, and adjusted cash flow increased 20% year over year, as the company's production grew 21%. Meanwhile, Chesapeake's first-quarter adjusted net income more than doubled to $405 million, fueled in part by a 72% year-over-year increase in its realized natural gas price and 28% year-over-year growth in production from the northern Marcellus.

Investor takeaway
The rapid growth in Marcellus shale production has not only helped make our country less reliant on imports, but it has also reversed a previous trend of unprofitability among gas producers as gas prices have risen. With Henry Hub gas prices expected to remain in a range of $4-$5 per MMBtu in the near future, companies such as Cabot Oil & Gas, Range Resources, and Chesapeake Energy should continue to generate strong margins, profits, and cash flows.