Contaminated water is a growing concern across North America, especially as related to the oil and gas industry.  A December 2011 article posted by staff at the Natural Resources Defense Council highlighted more than 30 reported incidents across 13 U.S. states of drinking water contamination with hydraulic fracturing as the suspected cause.  The author emphasized that those listed were only a sampling of reported cases “where a homeowner had enough detailed knowledge to know that a nearby well was recently fractured and specifically included that information in reports.”  Cases were reported at wells owned by large publicly-traded companies such as Southwestern Energy Corp. (NYSE: SWN), Ballard Petroleum (now Encana Corporation (NYSE: ECA)), Chesapeake Energy Corp (NYSE: CHK), Devon Energy Corp. (NYSE: DVN) and Range Resources Corp. (NYSE: RRC).

Movie goers that have seen “A Civil Action,” starring John Travolta and Julia Roberts, can imagine that type of lawsuits that are ongoing in those communities claiming damages because hydraulic fracturing has polluted their water.  Albeit that movie was about dumping toxic waste, it has a similar undertone as big business is disputing the claims of the residents.  Concerned investors and citizens are encouraged to perform their due diligence on pollution and water contamination from hydraulic fracturing and other common practices in the oil and gas industry to better understand the magnitude of the problem.

There is a company that is establishing a growing presence with its ability to offer a solution to the malevolent hydraulic fracturing business.  BioLargo, Inc. (OTCBB: BLGO), a creator of patented iodine technologies, has developed CupriDyne™-SAP, a proprietary technology uniquely suited to detoxify water in a variety of applications, including the oil and gas industry.  Using Iodine in a stable molecular form, CupriDyne™-SAP is able to eradicate bacteria and sop-up heavy metals and radioactive elements.  Iodine, one of nature’s most powerful cleaners, is simply combined with the somewhat ineffective filtration processes that are presently used.  The reaction products are harvested; leaving clean water as the end product and eliminating the threats that watersheds, wells and groundwater in the area currently face.

The possibilities for the BioLargo technology are tremendous in the energy sector.  Enormous amounts of water are used and/or generated (saline water is extracted from the ground with the oil and gas) every day in collecting oil and gas reserves.  The ratio of produced water to oil is roughly 10 barrels of produced water per 1 barrel of oil.  According to the American Petroleum Institute, more than 18 billion barrels of waste fluids from oil and gas production are generated annually in the United States.  That’s more than two million barrels of tainted water every hour…and that’s just in the U.S.

Energy is an integral part of the Canadian economy.  In 2009, the $80.2 billion energy sector represented 6.7% of Canada’s gross domestic product.  Canada’s oil sands industry has been put under a microscope in recent years because of its contaminative nature.  The oil sands of Northern Alberta are the second largest oil deposits in the world, behind only Saudi Arabia.  Because of the way that the oil is trapped in the sands, it takes special processes – and plenty of water – to extract the oil and make it fluid enough to travel through pipelines.   In general, three to four barrels of water are used/contaminated for each barrel of oil produced from tar sands.

In June of 2011, the Canadian Association of Petroleum Producers said, “Oil sands growth and new production from existing conventional oil reserves will drive Canadian crude oil production to about 4.7 million barrels per day by 2025.”  That means that billions of barrels of polluted water will be generated in the process each year as well.

So what happens with the contaminated water?  Theoretically, it is should be processed to ensure that it is non-toxic.  According to the U.S. EPA, “Produced waters contain levels of radium and its decay products that are concentrated, but the concentrations vary from site to site. In general, produced waters are re-injected into deep wells or are discharged into non-potable coastal waters.”

Water contamination in the oil and gas industry is a growing concern.  As such, people, companies and countries are starting to hone-in on what BioLargo has to offer.  That’s why investors should be taking note of its corporate happenings.  The company has been appointed as a founding member of a Canada’s Natural Sciences and Engineering Research Council (NSERC) “Industrial Research Chair in Oil Sands Tailings Water Treatment” formed to solve the contaminated water and tailing ponds problems associated with the oil sands industry, leaving the company in a prime position for growth.

“The core technology is well established and with the addition of our world-class team members over the past year, it is now a great time for BioLargo to refine, focus and execute to help solve serious problems that face industry and our world,” said Dennis Calvert, President and CEO of BioLargo in a recent company statement.

The bottom line is that green energy initiatives (i.e. solar, wind) are fantastic in theory and gaining momentum in frequency of use, but still nascent in energy’s big picture.  Oil and gas are still going to be the primary sources of energy for the foreseeable future.  There are plenty of reserves in North America to accommodate less reliance on foreign oil, but the industry has to transition its processes into having less of an impact on the environment and population.  BioLargo holds a key to that evolution.

BioLargo (BLGO) Stock Quote and News:

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