At this point, the hydraulic fracturing revolution is out of the bag. The advanced-drilling technique has made it possible for exploration and production (E&P) firms to tap the abundance of natural gas and other hydrocarbons locked within North America’s various shale formations. As this revolution has progressed, fertile fields such as the Marcellus, Eagle Ford and Bakken have now become standard additions to the energy sector’s lexicon.

But like emerging-market investors trying to find the next China in its infancy, the search for the next prolific shale play is on.

For the E&P industry, that chase could have them visiting our neighbors to the North because in Canada, Alberta’s Duvernay shale could be the next hotbed of activity. The region has geology very similar to the Eagle Ford in Texas, with a virtual ocean of fuel, giving it the potential to be Alberta’s go-to liquids-rich shale field.

However, production still remains in its embryonic stages, and the E&P sector has just now begun to drill promising test wells. For investors, jumping in to the Duvernay before it becomes the next Bakken could be a great portfolio play.

Rich Reserves and Existing Infrastructure

Covering over 100,000 square kilometers along the edges of the Canadian Rockies foothills, the Duvernay could be one of the most fertile fields in the nation and usher in a new wave of strong production. Like North Dakota’s Bakken, the Duvernay was one of the major fields that launched North America’s petroleum industry more than 65 years ago. Today, it’s poised for a rebirth as a vast source of natural gas and natural gas liquids — all thanks to the horizontal drilling revolution.

Those advances have unearthed some mighty big reserves. According to analysts at the Bank of Montreal, the Duvernay could hold as much as 750 trillion cubic feet of gas, with preliminary reports indicating that it contains between 75 and 115 barrels of liquid for every 1 million cubic feet of natural gas.

Putting that into perspective, that’s approximately 30% larger than the Eagle Ford. Using current technology, producers should be able to pull roughly 5 billion barrels of liquids and 150 trillion cubic feet of gas from the field. Again, that’s more than the Eagle Ford.

And there’s certainly an end market for all of those rich natural gas liquids. The oil sands industry requires those liquids — or condensate — to dilute bitumen and make it flow through pipelines like TransCanada’s (NYSE:TRP) Keystone XL. Those liquids have been in short supply in recent years, and some analysts estimate that oil sands firms would need to import them from offshore locations.

The real kicker for the Duvernay’s future success, though, comes from its past. As any Canadian oil patch veteran knows, oil and gas development in the area is old hat. That means plenty of critical infrastructure is already in place in order to get Duvernay shale gas to market.

Large processing facilities and pipelines dot the region, so there would be little need to build expensive and expansive infrastructure, making it potentially cheaper to develop than plays in the northern hinterland. For example, British Columbia’s Horn River basin — which contains roughly 78 trillion cubic feet of natural gas — has seen relative little interest due to the fact that the area is remote and infrastructure is lacking.

In 2011, only 17 horizontal and 13 vertical test wells were drilled, and only a handful have been drilled thus far in 2012. However, that all could be changing soon, as land sales in the region have surged since the big-energy boys have finally taken notice of the Duvernay’s potential.

According to an analysis by geosciences company Canadian Discovery, the oil patch has spent $672 million on buying Duvernay land. Prices per acre continue to rise and have jumped more 55% since 2009.

Adding the Liquids-Rich Play

Until recently, Duvernay’s acreage was home to just smaller and wildcat production firms. Now a virtual who’s-who of energy players have moved into the region. ConocoPhillips (NYSE:COP), Apache (NYSE:APA) and Canadian Natural Resources (NYSE:CNQ) now all hold land in the shale formation. However, the biggest winner in the Duvernay could be another beleaguered natural gas play.

As one of the largest producers of natural gas in North America, EnCana (NYSE:ECA) has seen its share price fall along with overall natural gas prices. That’s prompted the producer to look toward liquid-rich plays, rather than just focus on dry gas. It purchased more than $300 million worth of land in Duvernay in Q1.

Those land acquisitions have been strategically placed, and EnCana estimates that its holdings cover more than half of the land available in the liquids window. Likewise, EnCana has unveiled the most aggressive drilling program in the region out of its competitors like Talisman (NYSE:TLM).

Overall, the shale play could be exactly what EnCana needs to finally get itself moving again. Early test wells have recently suggested that condensate yields are around 75 to 300 barrels of liquid for every 1 million cubic feet of natural gas for its acreage. EnCana CEO Randy Ereman thus boasted at the company’s annual meeting in Calgary in June that EnCana could give away the gas and still make money on the liquids because condensate prices are tied to Brent crude, not natural gas.

That’s critical considering that low dry-gas prices have been a yoke around the E&P firm’s neck for roughly a year. While it’s still in its infancy, the Duvernay could be that much-needed catalyst to take EnCana shares much higher over the future. For investors, the knocked-down energy producer remains a value.

As of this writing, Aaron Levitt did not own a position in any of the aforementioned securities.