Recent stories in both The Wall Street Journal and Bloomberg painted an ugly picture of America's energy boom. Hundreds of garbage bags filled with mildly radioactive waste were found at a deserted gas station in a remote North Dakota town and on flatbed trailers near a landfill. The bags contained what are known as "oil socks" used to capture silt from wastewater that results from hydraulic fracturing.
North Dakota state regulators are still trying to determine who is responsible for these improperly disposed materials. However, one of the trailers is believed to belong to a company that had provided services for top Bakken driller Continental Resources (NYSE:CLR). The discovery prompted Continental to cut ties with the company.
The Wall Street Journal article pointed out that North Dakota doesn't actually have a single storage facility capable of handing the radioactive waste. That problem, however, is a major opportunity for Nuverra Environmental Solutions (NASDAQOTH:NESC), which opened its Bakken landfill last year.
Nuverra's new state-of-the-art, state-approved facility accepts solid waste from oil-field exploration and production activities. That includes soil contaminated with drilling fluids, drill cuttings, geothermal production materials, and other solid-waste materials. Needless to say, this isn't a residential landfill, but was built specifically to provide an environmentally responsible location for disposal of drilling solids.
Providing responsible disposal is actually one of Nuverra's core operations. While Nuverra owns 56 liquid disposal wells across the country to properly dispose of fracking wastewater, it is also working with Halliburton (NYSE:HAL) to recycle this water as part of the two companies' H2O Forward agreement. This means only the water that can't be reused will be disposed.
Nuverra is now taking the next logical step in its efforts by working to recycle drilling solids as well. The company is collaborating with partners to develop solids treatment solutions and technology, as the following slide shows.
As that slide points out, Nuverra is working to eliminate the burial of drilling solids at the well site. Furthermore, it intends to build a thermal desorption system that would expand its treatment capability so that it can create marketable byproducts from the waste. This would reduce waste volume by 30%-50% while creating beneficial uses for the material.
Because of these investments, the landfill could be a really important strategic asset to Nuverra and Bakken shale producers such as Continental Resources. Not only does it offer proper disposal of drilling solids, but it can potentially turn that waste into beneficial byproducts. There's also the potential that the landfill could be used to solve the oil-sock problem, which would be a big win for Nuverra and the Bakken region.
Nuverra stands alone in its laser focus on providing environmental solutions to the energy industry. Its Bakken landfill could become the final resting place of these oil socks that some thought could be hidden away and forgotten. Clearly, this is an opportunity that Nuverra doesn't want to miss -- it can take advantage of the environmental missteps of the industry and sign up more customers to its full-cycle, sustainable environmental solutions.
Matt DiLallo owns shares of Nuverra Environmental Solutions. The Motley Fool recommends Halliburton. The Motley Fool owns shares of Nuverra Environmental Solutions. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.