Boomtowns throughout history have occurred because of the promise of wealth and prosperity; dreamers following after the next big thing and hoping to make a name for themselves and find security for their families. In the old west of the US it was the gold rush that brought people out to the desolate small towns in places like San Francisco, Deadwood, South Dakota, or La Paz, Arizona.
In every case there is some commodity, industry, or other venture that brings people flocking into a previously uninteresting place at a break-neck pace to claim their piece of the newly discovered or promised pie. Would anyone care about West Texas if oil didn't spring up out of the ground in large pools?
Probably only the goat farmers would care; to be honest.
Boomtowns almost always follow a cycle of incredibly quick growth, social disruption often to the point of lawlessness, and more often than not a "bust," or desertion of the area once the commodity dries up or the industry becomes obsolete. You can find upon a quick search many towns worldwide which have gone from nothing to centers of commerce, to deserted ghost towns in very short spans of time. Some survive as shells of their former glory. Butte, Montana's, current population is less than one-third of its peak a century ago.
Right now due to the long-term commodity boom being ushered in by emerging market growth and the profligacy of major western central banks and governments there are a number of towns that qualify for the label of commodity boomtown.
Williston, North Dakota, in the U.S. is probably the most stunning example of a town literally exploding overnight. In a country with structural U-6 unemployment of more than 15% Williston has an effective rate of 1.5%. The growth of the oil industry finally taking advantage of the Bakken Field of Western North Dakota, and Eastern Montana, has created a town that is on a moonshot growth trajectory. Fast food jobs are being offered at $15/hr. The median income in 2011 was $55,000+ per year and the city will double to more than 50,000 in the next 10 years, and those numbers are very conservative.
The U.S. is just beginning its turn as the world's biggest oil producer, which is due to last for a long time as the estimates of how much it is sitting on range from the outdated 3% of the world's reserves to as high as 26% of the world's reserves. It has hundreds of years of Natural Gas and coal as well.
Towns like Billings, Montana, itself a former boomtown, may also benefit from the new drilling techniques. The exploration work is happening now and we'll know in the next year or two if there are economically-viable deposits left in the Heath plate. Billings will grow simply as a function of its location as a transportation hub thanks to the growth in North Dakota, and north of it in Alberta, Canada.
Speaking of Alberta, it is another shale oil/natural gas play of near epic proportions. Its wages (70% higher than national average), unemployment (30% below national avg.) and GDP (30% faster growth than the rest of Canada) data are impressive. More impressive than that is the size and number of deals being made by Asian oil companies from China, Japan, and Malaysia, in recent months to source future production for their countries. Production costs there are so cheap and even with liquefaction and transport the cost is still cheap enough to fill current demand, no less the demand that is projected if these countries want to grow (China and Malaysia) or just hold serve (Japan).
China's energy demands will grow far beyond its ability to self-produce. Next door in Mongolia, near the city of Ulaanbaator, is enough coal alone to power China at its current needs for the next 150 years at 1/3 the price that China is currently buying it from Australian companies. Add to that a precious metals deposit at Oyu Tolgoi that has been estimated at $350 billion dollars in just gold and copper at current prices. That number, for anyone familiar with mining drill results, will rise as the project is developed and a clearer picture is created. Rio Tinto (RIO) bought out Ivanhoe Mining's 51% stake in the project and production is due to begin next year. Mongolia, and Ulaanbaator, is in the early stages of its commodity boom that will last for the next 50 years. It is very possible that we will talk about that city in 20 years the same way we talk about Abu Dhabi today. Such is the size and breadth of the mineral and energy wealth there. Since it is mostly high desert environmental and permitting concerns are minimal.
Cities around Southeast Asia such as Vung Tau, Vietnam which will become the oil and gas focal point for southern Vietnam for the next century, Siem Reap, Cambodia, the crown jewel of tourism with Angkor Wat, and Yangon, Myanmar, now that the West has lifted economic sanctions after 60 years of isolation, will all benefit from the regional growth of their more economically advanced neighbors: Singapore, Malaysia and Thailand. Myanmar will become a major point of entry for goods coming from India, Africa and the Middle East both because of the massive oil and gas pipeline being built by CNOOC between the Bay of Bengal and Kunming as well as the port complex at Dawei, which will allow shippers to bypass the Malaccan Straits and open up trade between the Greater Mekong SubRegion (GMSR) and the rest of the world; bring Cambodian rice and rubber, Thai palm oil, rice and crude oil and even Vietnamese coffee and cashews.
ASEAN's connectivity plan to link the entire GMSR via the Singapore-Kunming Rail Line is part of its long-term plan to open up the resource-rich region to and improve trade both with the rest of the world and within ASEAN itself. The last sections of road and rail are due to be completed between now and 2016.
For some of these towns their status as boomtowns may be due less to their proximity to irreplaceable resources than to their favorable geography as the world's economy shifts from the U.S. and Europe toward the Pacific Rim. But, regardless of why they will grow, the groundwork is being laid now for a generation or two of economic growth, which will reward the savvy investor handsomely. U.S., Japanese and European multinationals that invest in these places now are good bets while the local economies develop homegrown companies to satisfy economic demands. General Electric (GE) and Coca-Cola (KO) are already setting up shop in Myanmar, for example. Toyota (TM) is investing heavily in the growing Thai and Indonesian automobile markets. Singapore's banks like DBS Group (DBS) will be there to finance these deals and companies like Keppel Corp. (KEP) will build the offshore oil rigs.