China changes everything. Demand for energy there (as well as the rest of the developing world) is skyrocketing. And while we're--finally--seeking out new sources, it'll take years to find them and bring them online.

Some forecasts are direr—Goldman Sachs has warned of $105 oil. I'm not going to join that predictions game, and I'm sure we'll see some fluctuations in price up and down.

But this I know: My investing models continue to point to marketbeating profits in energy stocks for the foreseeable future.

When that changes, we'll be out. But until it does, you've got to include energy investments in your portfolio.

Here's a stock I want you to own now: It's the first company to produce commercial crude from oil sands in Canada.

Few people know this, but Alberta, Canada, is the “Saudi Arabia of oil sands.” There’s enough oil in those sands to last the next fifty years. We’re still in the early stages of this oil-sands boom.

Not too many years ago, this technology was a pipe dream. Costly and inefficient. But with oil around $60 -- and the science greatly improved -- this is a growing business that'll keep getting better.

My favorite play here is Suncor Energy (SU), a Canadian energy company that produces light crude oil, diesel fuel and custom blends. The company also explores for and refines crude oil, and was the first company to produce commercial crude from the oil sands in Canada.

Suncor’s Sunoco subsidiary (unrelated to the U.S.-based company of the same name) refines crude oil and processes fuels, petrochemicals and heating oils. The company markets gasoline in Ontario primarily through 500 Sunoco-branded gas stations.

Last year, Suncor acquired ConocoPhillips’ Denver refinery and 43 Phillips-branded gas stations.

Fundamentally, Suncor is probably the strongest oil company on my current Buy List. It has incredibly healthy operating margins, and is ready to handle the long-term energy boom.

It’s one of the largest producers of oil and natural gas in North America.

The company recovers bitumen—a very heavy oil—from the oil sands and refines it into useable products.

Suncor is a fully integrated energy company with a long, successful history in the oil and natural gas businesses. In the second quarter of this year, net earnings were $112 million, and cash flow from operations was $305 million. The company has increased shareholders’ wealth 16-times over in the last ten years.

During the quarter, Suncor made significant progress in rebuilding portions of the oil sands plant damaged by a January fire, and they expect to return to full production capacity in the third quarter. Major repairs are complete, and the remainder of the reconstruction effort is now focused on replacing piping and electrical systems to support operations.

Planned maintenance, which had been originally scheduled for September, was brought ahead and was near completion at the time of its last earnings announcement. Once that is done, Suncor expects to commission new expansion projects at the oil sands plant and increase production capacity by the end of the year.

Tar sands companies like Canadian Natural Resources and Suncor are sensitive to oil prices. However, the oil they get out of the tar sands is sweet. They use natural gas to generate a lot of steam to get the oil out of the tar sands, extra-expensive sweet crude that’s in high demand. These tar sands companies will be doing very well for a long

time. Yes, the cost of natural gas has gone up, but the margins to extract the crude are still very fat.

We’ve already made a lot of money with Suncor (up 120%) and I expect to make a lot more. We're still in the early stages of this oilsands boom. The company will boost daily capacity to a half-million barrels by adding their third plant. And overall, they expect to boost output 50% by 2008. Buy it under $61.

This Article is from the Fall 2005 Top 10 Special Report. Get the latest stock recommendations from other top financial experts today!  Request your FREE copy of the newest report from NewsletterAdvisors.com.  Click here.