Solving the 

World’s Water

Challenges.

3rd Water Management for Shale Plays

October 2012
Corporate Presentation – October 2012 2

Ecosphere Energy Services, LLC

Today’s Agenda

• Oil & Gas Industry Challenges

• Water Treatment Challenges

• Water Treatment Strategy

• Company Introduction

• Technology Overview

• About Ozonix® 

• Products & Services

• Benefits & Capabilities

• Oil and Gas Applications

• Microbial Control Validation

• Scale Control Validation

• Case Studies

• Arkansas – Fayetteville 

Shale

• Oklahoma – Woodford Shale

• West Texas – Permian Basin

• Pennsylvania – Marcellus 

Shale

• Environmental Impact

• Industry Recognition
Oil and Gas │ Industry Challenges

Corporate Presentation – October 2012 3

Source: Energy Information Administration, Annual Energy Outlook 2012 

Gas Prices are Down Not Coming Back Soon

U.S. spot market prices

(2010 dollars per MMBtu)

Gas Price Projections

(2010 dollars per Mcf)
Oil and Gas │ Industry Challenges

Corporate Presentation – October 2012 4

0.00

1.00

2.00

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7.00

0

20

40

60

80

100

120

140

160

1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

Gas Price $/Mcf (Real 1976 Dollars)

Operating Cost Index

Equipment Cost Index

Gas Price

Source: Energy Information Administration, Office of Oil and Gas

Operators Must Reduce Costs

Indices for Gas Equipment and Annual Operating Costs and Gas Prices in Real 1976 Dollars
Oil and Gas │ Water Treatment Challenges

5

Water Related Task

Corporate Presentation – October 2012

Water Acquisition

Chemical Injection

Completions Process

Flowback & Produced Water

Wastewater Disposal

• Source Water Availability

• Environmental Impact 

• Water Quality

• Chemical Transportation

• Risk of Chemical Handling

• Environmental Impact of Chemical Spills

• Environmental Risk of Accidental Release

• Fracturing Fluid Migration into Water Aquifers

• Exponential Increase of Produced Water

• Cost and Availability of Storage

• Environmental Risk of Spills

• Lack of Disposal Options

• Costs of Disposal & Transportation

• Treatment and Handling of Solid Residual 

Waste

Associated Challenges
Water Acquisition

Chemical Injection

Completions Process

Flowback & Produced Water

Treatment For Reuse, Recycling

Oil and Gas │ Water Treatment Challenges

Corporate Presentation – October 2012 6

Water Has Become a Major Industry Concern

Recycling flowback and 

produced water is now a 

PRIORITY

Ecosphere’s Approach:

• Chemical-Free Treatment

• Disinfection Treatment 

with a Patented AOP

• No Waste Stream
• Barium Sulfate

• Hydrogen Sulfide

• Iron-Sulfide

Microbial Control & Scale-Inhibition

• Microbial Induced Corrosion (MIC)

• Sulfate Reducing Bacteria (SRB)

• Acid Producing Bacteria (APB)

• Calcium-Carbonate

Corporate Presentation – October 2012 7

Oil and Gas │ Water Treatment Challenges
Oil and Gas │ Water Treatment Challenges

8

Historic Fresh Water Fracturing Methods

Corporate Presentation – October 2012

Flowback and Produced Water Challenges

• Biocides

• Scale Inhibitors

• Corrosion Inhibitors

• Surfactants

• More Organics, Bacteria, Heavy Metals, Frac Chemicals, TDS, TSS

• Requires More of the Traditional Chemicals Previously Used

• Potential for H2S Souring, Corrosion, Scale, etc.

• Compatibility Issues with Anionic Friction Reducers

• Compatibility Issues with Gel Systems

• Leaching Minerals from the Formation

• Fresh Water Treatment Costs: 

 $0.10 to $0.70 Per Bbl
Oil and Gas │ Water Management Strategies

Corporate Presentation – October 2012 9

1. Sourcing and Disposal

2. On-Site Water Recycling

3. Off-Site Water Recycling

• A Traditional Strategy

• An Inefficient Use of Resources

• Recycled Water Treated and Cut with Fresh Water

• Treated Water is Used as the Fracturing Fluid

• Water is Transported via Truck or Pipe

• Flowback and Produced Water is Treated 

 at a Centralized Location
Oil and Gas │ Water Management Strategies

Corporate Presentation – October 2012 10

Water Treatment Options

Ecosphere's Patented OZONIX® Technology

Chemical 

Biocides

Ultraviolet 

(UV) Flocculent Chlorine 

Dioxide

Thermal 

Evaporator Membranes Electro

Oxidation

Hydrodynamic 

Cavitation

Acoustic 

Cavitation

Ozone 

(O3)

SRB ✔ ✔ ✔ ✔ ✔ ✔

APB ✔ ✔ ✔ ✔ ✔ ✔

GHB ✔ ✔ ✔ ✔ ✔ ✔ ✔

HEAVY METALS ✔ ✔ ✔ ✔ ✔ ✔

SOFTENING ✔ ✔ ✔ ✔

SCALE 

REDUCTION ✔ ✔ ✔ ✔ ✔

HYDROCARBON ✔ ✔ ✔

FLOW RATES Moderate Moderate Slow Moderate Slow Slow Extremely High (3,360 GPM Per Mobile Unit)

SECONDARY 

WASTE No No No No Yes Yes No

MAINTENANCE Low High Moderate Moderate High High Low

Treatment 

Objective
11

U.S. Patents: 7,699,994 / 7,699,988 / 7,785,470 / 

7,943,087

 │ Technology Overview

Corporate Presentation – October 2012
12

• REDUCE COSTS

• PRODUCE BETTER WELLS

• Eliminate Bacteria & Prevent Scale

• Destroy Highly-Resistant Biofilms

• Reduce Chemical Handling & Costs

• Oxidize Oil & Grease, H2S, Iron, etc.

• Recycle Water for Re-Use

• Preserve Vital Water Resources

• Environmentally Friendly 

• Customer Friendly 

Benefits

With Ozonix®

Everyone Wins

Corporate Presentation – October 2012

 │ Oil and Gas │ Benefits
Performance Features

• 420 gallon per minute flow rates

• Self-contained mobile frac tank

13

 │ Oil and Gas │ Products

OZONIX® EF10, EF20, EF60 & EF80

Performance Features

• 840 gallon per minute flow rates

• Self-contained mobile frac tank

Performance Features

• 2,520 gallon per minute flow rates

• Self-contained 53’ mobile trailer

Performance Features

• 3,360 gallon per minute flow rates

• Self-contained 53’ mobile trailer

Corporate Presentation – October 2012
 │ Oil and Gas │ On-Site Treatment

Recycled 

Water Source

Pump Trucks

Chemical Trucks

Blender

Wells

Surface Water
 │ Oil and Gas │ On-Site Treatment
 │ Oil and Gas │ Off-Site Treatment
45 Billion SRB / ml 95 SRB / ml

17

 │ Oil and Gas │ Results

*Source of the influent water (tested by an independent laboratory) was a 30k bbl storage pit of 100% produced water from the Fayetteville Shale

Proven Microbial Control

Corporate Presentation – October 2012
 │ Oil and Gas │ Results

Corporate Presentation – October 2012 18

• 610 Oil & Natural Gas Well around the U.S.

• 1.6+ MILLION Gallons of Chemical Biocide Eliminated from Fracturing Operations

• Multiple Long Term Contracts: 

• Arkansas – Fayetteville Shale

• Oklahoma – Woodford Shale

• Texas – Permian Basin

2+ Billion Gallons of Water Recycled 
Microbial 

Control

Scale

Prevention

Corrosion

Control

Friction

Reduction

• SRB (Sulfate Reducing Bacteria) Elimination, H2S 

Elimination

• APB (Acid Producing Bacteria) Elimination

• Iron Sulfide, Calcium Carbonate, Barium Sulfate Inhibition

• Microbial Biofilm Destruction

• Organic Scale & Corrosion Control

• Iron Oxidation & Scale Crystallization Inhibition

• Compatible with Friction Reducer and Gel System

• Water Softening, Reduced Surface Tension

19

Chemical-Free Water Treatment

Corporate Presentation – October 2012

 │ Oil and Gas │ Benefits
 │ Field Proven

20

Validated Case Studies from Major Shale Plays

Corporate Presentation – October 2012

Billions of Gallons Treated:

• Fayetteville Shale

• Woodford Shale

• Eagle Ford Shale

• Permian Basin

• Marcellus Shale

Ozonix® Treatment Facts:

• 51,418,796 bbl Treated

• 2,159,589,432 Gallons Treated

• 610+ Wells Completed

• 120 bbl/min Capabilities
 │ Field Proven │ Case Study

21

Fayetteville Shale, Arkansas

On-Site Frac Fluid Treatment with 40% Recycled Water at 120 BPM

Corporate Presentation – October 2012

*Lab Data Provided by American Interplex Corporation; Compilation of 468 Lab Samples Taken From 142 Wells

163,109 

27,099 

713 

 -

 50,000

 100,000

 150,000

 200,000

Avg Pit SRB Avg Inf SRB Avg Eff SRB

SRB (MPN/ml)

Average Sulfate Reducing Bacteria (SRB)

Red = Pit; Orange = Influent; Blue = 

Effluent

Woodford Shale, Oklahoma

100% Produced Water Recycling
 │ Field Proven │ Case Study

22

Permian Basin, West Texas

On-Site Frac Fluid Treatment 80/20 Fresh Water/Flowback Mixture Ratio at 80 BPM

Corporate Presentation – October 2012

*Source of Case Study is EES’ Sub-Licensee Hydrozonix, from Operations in the Permian Basin, West Texas. 

0

50,000

100,000

150,000

200,000

250,000

300,000

3 3 4 4 5 5 6 6 7 7 8 8 9 9 10 10 11 11

# of Cells Per Milliliter

Stage Number

Bacteria Treatment Results

Influent

Effluent

99.98% 

REDUCTION
 │ Field Proven │ Case Study

23

Permian Basin, West Texas

Increasing Use of Flowback and Produced Fluid

Corporate Presentation – October 2012

*Source of Case Study is EES’ Sub-Licensee Hydrozonix, from Operations in the Permian Basin, West Texas. 

0%

10%

20%

30%

40%

50%

60%

70%

10/14/1111/13/1112/13/1101/12/1202/11/1203/12/1204/11/1205/11/1206/10/1207/10/1208/09/1209/08/1210/08/12

120 Wells Completed

14 Million Barrels Treated

Of that, 3 Million Barrels Recycled 

Flowback & Produced Fluid
 │ Field Proven │ Case Study

24

Marcellus Shale, Pennsylvania

Produced Water Recycling

Corporate Presentation – October 2012

*Source of Case Study is EES’ Sub-Licensee Hydrozonix, from Operations in the Marcellus Shale, Pennsylvania

-5.00

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30.00

35.00

40.00

-1.00 1.00 3.00 5.00 7.00 9.00

Change in Differential Pressure (PSIG)

Time in Hours

Scale - Tube Blocking Test Results

Effluent - Treated Fluid

Influent - Raw Fluid
25

“One of the Dominant Providers of Water Treatment for the Shale-Gas 

Industry”

“Techno-Economic Assessment of Water Management Solutions”

Selected as 3x (2010, 2011 & 2012) TOP 50 Water Companies

“Building Momentum for Advanced Water Technology Solutions”

2012 Product Leadership Award

North American Disinfection Equipment for Shale Gas Wastewater 

Treatment – Best Practices

By: Frost & Sullivan

 │ Industry Recognition

Corporate Presentation – October 2012
26

 │ Contact Us

Corporate Presentation – October 2012

U.S. Oil and Gas

Service Provider

Global Energy

Service Provider

www.Hydrozonix.com www.EcosphereTech.com
600 S. German Lane Building #9

Conway, AR 72034

P: 501.205.0797

F: 772.781.4778

www.ecospheretech.com

Stock Symbol: ESPH │ ISO 9001 Certified