The U.S. is sitting on top of a fuel goldmine, it seems.

Not shale gas or crude oil, but fresh water and suitable land to produce 25 billion gallons of algae-based biofuel--a month's worth of the country's fuel needs each year.

The discovery comes from the U.S. Department of Energy's Pacific Northwest National Laboratory (PNNL), which looked in-depth at the water resources needed to produce suitable amounts of algae for the production of biofuels.

Algae grows best in areas of plenty of sunlight and water. To provide the stable conditions allowing the algae to grow best, warm weather and a humid environment are also preferred.

That makes the U.S. Gulf Coast perfect, not least for its abundance of water.

Biofuel research has turned towards algae in recent years after the discovery it has the ability to generate oil, which can then be turned into fuels.

Better still, it's abundant on a truly enormous scale, and doesn't bring with it the issues courted by biofuels from crops, which are accused of diverting resources needed for important food crops to fuel production.

The potential is huge, though so are the resources needed to produce such quantities of algae solely for fuel.

Water is the chief requirement, the scientists estimating that water use would equal one quarter of the quantity currently used by agriculture. That's an enormous amount, but the study does point out that the water could come from virtually anywhere, including fresh or salty groundwater, and seawater.

Plenty of land would also be required, with each 'algae farm' setting aside several pools of six to 15 inches deep, though again the study suggests there's land to spare for such a task.

Ultimately, the PNNL's study quotes estimates, rather than hard figures, but if such a system was put into place it could drastically reduce the U.S.'s oil imports.

And like any other biofuel, the algae-based fuel is much closer to carbon neutral than oil sequestered deep under ground over millions of years.

You can read about the report in more detail on the PNNL website.

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