State-owned Sinopec is set to sign up for an American technology that can recycle most wastewater produced from hydraulic fracturing.

Sinopec will likely sign the contract with Beijing Woteer Water Technology – an investor in Boston-based startup Oasys Water – by the end of this year, a marketing manager at Woteer surnamed Yu told Interfax.

“As the shale gas industry is only just taking off in China, there are still many problems concerning choosing the right solution and business model, which is why it is taking so long for us to sign the final contract,” said Yu.

“The cost is not high, but it varies for different projects, regions and so on. I think companies such as Sinopec and PetroChina should pay greater attention to the wastewater technology in the early stages of a project and look for the right integrated solution,” Yu added.

Sinopec held a field test of Oasys Water’s membrane brine concentrator (MBC) technology at a shale play in the United States last month, Wang Daxin, technical director at Woteer, previously told Interfax.

The technology uses forward osmosis to treat and desalinate wastewater, recycling up to 80% of it and reducing the need for freshwater.

Woteer led a round of financing for Oasys in September 2013, raising a total of $15 million.

At the same time, Oasys announced a partnership with Woteer to provide MBC technology as an “economically and technically superior alternative” to conventional evaporative technologies used in China’s industrial water treatment market.

Oasys has pitched the MBC system to the oil and gas industry as a cheaper and greener way to treat industrial waters – particularly byproducts from fracking – as it can be powered by renewable energy sources and has lower maintenance costs than competing technologies.

Sinopec would not be the first Chinese company to sign up for the technology. The Changxing power plant in Zhejiang province – owned by China Huaneng Group – will use Oasys Water’s process to treat wastewater from flue gas desulphurisation.

The planned wastewater treatment will desalinate up to 650 cubic metres of wastewater per day. The technology will be sent to Zhejiang early next year.

Ecological cost

Chinese state companies are aware of the need to protect the environment, but many have not fully considered the ecological cost of their projects, said Yu.

It is normal for shale gas exploration to cause some level of environmental pollution, as is the case with conventional gas exploration, said Bao Shujing, shale gas director at the China Geological Survey.

However, Chinese reports that shale gas drilling has many serious environmental side effects are “just media hype,” said Bao.

“We cannot stop making progress in shale gas development,” Bao told Interfax.

But failing to deal with wastewater properly could damage China’s environment even further, said Yu.

Woteer has sold four 25-ton wastewater treatment units to Houston-based National Oilwell Varco in the US, which plans to use the equipment to provide professional services for shale gas companies.

“We found wastewater in the US looks just like soy sauce, said Yu, adding that companies will not be able to ignore wastewater treatment.