PDO currently produces some 450,000 m3/day of water as an associated co-product of its oil output of 135,000 m3/day. The volume of this production water has been steadily increasing over time and is predicted to rise to above 900,000 m3/day by the year 2009 (Figure 1). In 1998 approximately 40% of the produced water was injected by PDO for reservoir pressure maintenance. The remaining volumes were disposed of into shallow and deep reservoirs. PDO is predicted to spend some US$130 mln on produced water management over the coming 8 years of which US$120 mln is related to disposal into deep reservoirs. Understandably significant effort is invested in exploring alternatives to Deep Water Disposal. The lifecycle cost of DWD over a 20-year period has been calculated at PV US$ 0.13/m3 of water disposed. This lifecycle cost is used to benchmark alternatives. To date conventional water clean-up technology has been estimated as having a lifecycle cost of between PV US$0.3-US$0.5/m3 water treated. During 1998, and with input from Shell Research Thornton, a new technology to the oilfield industry, termed reed bed technology was identified as an attractive produced water clean-up technology. Reed bed technology is a phytoremediation process, which promotes degradation of hydrocarbons and sorption of heavy metals while consuming some of the produced water. An experimental facility, 800 m2 capable of treating 20 m3/d of produced water, was commissioned at the Desert Agriculture Project in January 1999. The results, to date, have been encouraging with >98% removal of hydrocarbons from the Marmul production water. Heavy metal sorption is still under investigation. Evapotranspiration rates are in line with predictions with a 50% water volume reduction across the bed. Based on the success of this experimental facility a larger pilot, 6 hectares treating 3,000 m3/d of produced water, has been constructed and is being commissioned at Nimr. Based on the pilot costs, a lifecycle cost estimate for Reed Bed technology is estimated at PV US$0.07/m3 water. After 18 months operation, the time taken for system to reach optimal capacity, a decision will be taken on whether Reed Bed technology can be successfully applied in PDO. The challenge for PDO is to find a value crop that can be grown with the reed bed effluent to offset the capital investment and provide opportunities for the local community.