One way to profit from the global growth in energy industry is to invest in companies that provide the infrastructure, equipment, engineering and services to the industry.This strategy follows the theme whereby it is best to invest in firms that provide the tools and services to a specific industry as opposed to investing directly in the companies of the industry.Last week I wrote an article using the global auto industry as an example.

In the energy industry for instance, the oil producers contract out most of the activities such as the production of mechanical components for land and offshore drilling rigs, drilling services, servicing rigs, vessel fleet services, construction, installation and maintenance of pipelines, etc. These companies help the oil producers focus on their core operations while they take care of the rest of the work involved. In addition to the oil industry, these equipment, engineering & construction firms offer their services to other industries such as utilities, construction, transportation, etc.

The Top 15 Companies that serve the energy industry primarily in the oil and gas market are listed below:

Source: PFC Energy

The following chart shows the performance of National Oilwell Varco, 2011’s top ranked firm and the four major integrated oil majors since 2006:

Click to enlarge

Source: Yahoo Finance

While the growth of the oil majors was 50% or lower CAM rose by over 130% in the time period shown.

Other firms in this sectors that investors can consider include US-based McDermott International Inc. (MDR) and KBR Inc. (KBR), Swiss-based Foster Wheeler AG (FWLT) and Japan-based Chiyoda Corporation.

Disclosure: Long TKPPY