Citation
Coupled-processes

Material Information

Title:
Coupled-processes interactions of contaminants, bacteria, and surfaces
Creator:
Bellin, Cheryl A., 1963-
Publication Date:
Language:
English
Physical Description:
xiii, 170 leaves : ill. ; 29 cm.

Subjects

Subjects / Keywords:
Bacteria ( jstor )
Biodegradation ( jstor )
Biomass ( jstor )
Contaminants ( jstor )
Oxygen ( jstor )
pH ( jstor )
Quinolines ( jstor )
Soil science ( jstor )
Soils ( jstor )
Sorption ( jstor )
Bioremediation ( lcsh )
Dissertations, Academic -- Soil and Water Science -- UF
Microorganisms ( lcsh )
Soil and Water Science thesis Ph. D
Soil ecology ( lcsh )
Soil microbiology ( lcsh )
Genre:
bibliography ( marcgt )
non-fiction ( marcgt )

Notes

Thesis:
Thesis (Ph. D.)--University of Florida, 1993.
Bibliography:
Includes bibliographical references (leaves 157-169).
General Note:
Typescript.
General Note:
Vita.
Statement of Responsibility:
by Cheryl A. Bellin.

Record Information

Source Institution:
University of Florida
Holding Location:
University of Florida
Rights Management:
Copyright [name of dissertation author]. Permission granted to the University of Florida to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
Resource Identifier:
030382223 ( ALEPH )
31022288 ( OCLC )

Downloads

This item has the following downloads:


Full Text









COUPLED-PROCESSES: INTERACTIONS OF CONTAMINANTS,
BACTERIA, AND SURFACES
















By

CHERYL A. BELLIN


A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY

UNIVERSITY OF FLORIDA


1993





























Copyright 1993

by

Cheryl A. Bellin












ACKNOWLEDGEMENTS


This dissertation was the collaborative effort of many people that either

directly or indirectly facilitated the completion of this document. Working on a

project entitled coupled processes is not easily accomplished in one laboratory

needless to say by one individual. During the last four years I received

assistance from many people, which I greatly appreciate. First, I would like to

thank Dr. Suresh Rao, for his insightful method of teaching and guidance. His

questions and discussions generated enthusiasm and challenged me to a

higher level of thinking. I would like to thank my committee members, Drs.

Bitton, Nkedi-Kizza, Hatfield, and Rhue for their helpful comments and

suggestions during my doctoral program. I especially thank Dr. Bitton for

facilitating the surface characterization of the bacterial isolates used in these

studies and Dr. Nkedi-Kizza for his critical review of the abiotic behavior of

quinoline.

I would like to thank my friends and colleagues in the lab, Drs. Linda

Lee, Denie Augustijn, Itaru Okuda, and Ms. Dongping Dai. Most of the time ...

the lab was a great place to interact and work. I would like to especially thank

Linda for her personal and professional insight when it was asked for and even

when it was not. I thank Ron Jessup and Gerco Hoogeweg for their modeling







efforts. I also thank Christianne Smethurst and Ann Benner for their assistance

in the laboratory. I give special thanks to Candace Biggerstaff who added

levity, friendship, and help in finishing this dissertation.

Several people in the Soil and Water Science Department have

contributed to the work presented in this dissertation. In particular, I would like

to thank Dr. Sylvia Coleman for her guidance and use of her laboratory for

microbial preparations, Chris Pedersen and Dr. Amiel Jarstfer for the use of

their laboratory and their insight on microbiology ecology, Dr. Willie Harris for an

introduction to clay mineralogy and x-ray diffraction, and Kevin Cubinski and Dr.

Ann Wilke for their help in designing the continuously stirred flow-through

reactor

I would like to acknowledge the financial support provided by the State of

Florida via a Soil and Water Science research assistantship and additional

funding provided through Battelle Pacific Northwest Laboratories (PNL) from the

Department of Energy.

I thank Dr. John Zachara and Dr. Cal Ainsworth for their insights on

quinoline sorption, Dr. Jim Fredrickson and Dr. Fred Brockman for the bacterial

isolates used in this study and the other Battelle PNL staff for my enhancing my

summer fellowship experience.

I thank my mother and father for their continued support and pride in the

work I was doing. I also want to thank Dave Cantlin for his friendship, support,

and patience that were essential throughout my stay at UF and in Florida.













TABLE OF CONTENTS



ACKNOW LEDGEMENTS ..................................... iii

LIST O F TABLES .......................................... vii

LIST O F FIG URES ......................................... viii

A BSTRA CT .............................................. xi

CHAPTERS

1 INTRODUCTION .................................. 1

Overview of the Problem ............................. 1
S option . . . . . . . . . . . . . . . . . . . . 7
Biodegradation .................................... 9
Transport ...................................... 18
Research Objectives ............................... 21

2 CHEMODYNAMICS OF N-HETEROCYCLIC COMPOUNDS IN
ABIOTIC SYSTEMS: BATCH AND FLOW-THROUGH
TECHNIQ UES .................................. 25

Introduction .................................... 25
Quinoline Sorption Dynamics ....................... 28
Research Question and Tasks ...................... 35
Materials and Methods ............................ 35
Results and Discussion ........................... 39
Sum m ary ..................................... 73

3 ALTERATION OF SURFACES BY BACTERIAL BIOMASS .... 75

Introduction .................................... .. 75
Research Question and Tasks ...................... 78
Materials and Methods ............................ 79
R results ....................................... 83







Discussion ..................................... 98
Sum m ary .................................... 101

4 QUINOLINE BIODEGRADATION IN FLOW-THROUGH
SYSTEM S .................................... 103

Introduction ................................... 103
Quinoline Biodegradation Dynamics .................. 121
Research Question and Tasks ..................... 126
Material and Methods ............................ 127
Results and Discussion .......................... 132
Summary ..................................... 145

5 SUMMARY AND CONCLUSIONS ................... 148

Sum m ary .................................... 148
C conclusions .................................. 154

REFERENCES .......................................... 157

BIOGRAPHICAL SKETCH .................................. 170












LIST OF TABLES


Table pag

2-1. Soil properties before and after steam autoclaving .............. 36

2-2. Column parameters for sterile soil columns................... 48

2-3. Summary of estimated transport parameters for quinoline. ........ 57

3-1. Column parameters and Kf values for quinoline, naphthalene, and
45Ca in sterile and inoculated Norborne soil columns ............ 87

4-1. Nutrient concentration (mg/L) extracted from the Norborne soil
colum n .......................................... 133












LIST OF FIGURES


Figure age

2-1. Calcium (1) and quinoline (0) BTCs: a) pH 6, v = 0.162 cm/s and
b) pH = 6.9, v = 0.063 cm/s. Lines correspond to equilibrium
(solid) and first-order models (dash). (from Szecsody and Streile,
1992) .. . . . . . . . . . . . . . . . . . . . . . . 27

2-2. Quinoline speciation diagram and the protonated and neutral
species structures ..................................... 29

2-3. Quinoline sorption isotherms for three soils normalized to their
cation exchange capacity and to the fraction of protonated
species. .......................................... 41

2-4. Stirred batch reactor (a) and quinoline sorption onto the Norborne
soil fraction < 50 jim (b) (where C = quinoline filtrate
concentration and Co = the initial quinoline concentration)........ 43

2-5. Sorption of quinoline on the Norborne soil in the presence of 2-
hydroxyquinoline .................................... 44

2-6. Examples of breakthrough curves for PFBA and 3H20 in Norborne
soil columns ......................................... 46

2-7. Quinoline and 45Ca breakthrough curves with flow interruptions in
0.005 M (closed symbols) and 0.05 M (open symbols) CaCI2
Norborne soil columns ................................ 49

2-8. Quinoline breakthrough curves in 0.005 M (closed symbols) and
0.05 M CaCI2 (open symbols) in pH adjusted Norborne soil
colum ns. ...... .. ... .. ... .. .. .. ... ....... .. .... 51

2-9. Repeated flow interruptions for quinoline in a 0.05 M CaCI2 (pH
6.2) Norborne soil column and bicontinuum model fit ............ 55







2-10. Conceptual diagram of quinoline sorption onto smectite clay
m inerals. ........................................... 60

2-11. Isotopic exchange of 12C-quinoline and 14C-quinoline in 0.05 M
CaCl2 (pH 6.2) in the Norborne soil ....................... 63

2-12. Breakthrough curves of quinoline in Eustis soil with 0.005 M CaCl2
and 30% methanol ................................... 67

2-13. Structural representation of organic matter (adapted from Bbhar
and Vandenbroucke, 1987) .............................. 69

2-14. Scanning electron micrograph of an organic soil at 6000 x and
1000 x ............................................ 72

3-1. Measured BTCs for PFBA (N) in a sterile column and for Quinoline
in a sterile (@), 3N3A inoculated (*), and B53 inoculated (0J) soil
column. Column designations are given in parenthesis
corresponding to Table 3-1 ............................. 84

3-2. Measured BTCs for 45Ca in sterile (@) and B53 inoculated (0 and
*) soil columns. Column designations are given in parenthesis
corresponding to Table 3-1............................... 85

3-3. Measured BTCs for Naphthalene in a sterile (*) and a B53
inoculated (0) soil column. Column designations are given in
parenthesis corresponding to Table 3-1 ..................... 86

3-4. Measured BTCs for PFBA (*), 45Ca (0), Quinoline (J), and
Naphthalene (0) in a B53 inoculated soil column............... 92

4-1. Schematic of sorption and biodegradation in soil aggregates (C
and C = the solute concentration in the pore water inside the
aggregate and the bulk solution, respectively) (adapted from
Mihelcic and Luthy, 1988c).............................. 106

4-2. The impact of varying the sorption partition coefficient on
biodegradation (L/kg) in the presence of aggregates with radii of
0.05 cm. (From Scow and Hutson, 1992)................... 108

4-3. Data (symbols) for aggregates with different radii and DSB model
simulations (solid lines) of mineralization of 50 ng 14C-labeled
glutamate/mL in the presence of gel exclusion beads. (From Scow
and Alexander, 1992).................................. 109






4-4. Measured and simulated BTCs for 2,4,5-T developed with the two
region model for the two cases of no degradation (C =0) and
degradation (a >0). (From Gamerdinger et al., 1990) .......... 111

4-5. Simulation of naphthalene degradation in soil suspensions. The
lines were generated using the bicontinuum model with first order
biodegradation kinetics. (model input parameters from Guerin and
Boyd, 1992).. ...................................... 113

4-6. Simulation using the bicontinuum model with first-order
biodegradation kinetics assuming irreversible sorption .......... 115

4-7. Naphthalene mineralization for strain NP-Alk in a soil free (o),
Colwood (a) and Oshtemo (b) soil slurries with 66.7 (0), 133 (),
or 200 (0) mg/mL (From Guerin and Boyd, 1992). ............ 116

4-8. Naphthalene mineralization time courses for strain 17484 in a soil-
free control and Capac (a) and Colwood soil suspensions (From
Guerin and Boyd, 1992) ............................... 117

4-9. Conceptualization of quinoline biodegradation in the presence of
sm ectite clay m inerals................................. 122

4-10. Schematic of CSFTR system used to monitor quinoline
biodegradation ..................................... 129

4-11. Quinoline biodegradation in a Norborne soil column with limiting
nutrients ........................................... 137

4-12. Biodegradation of quinoline and production of 2-HQ by the 3N3A
isolate in the CSFTR .................................. 140

4-13. Alteration of bacterial activity upon introduction of Norborne clay
and silt as measured by the change in biodegradation of quinoline. 142












Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy

COUPLED PROCESSES: INTERACTIONS OF CONTAMINANTS,
BACTERIA, AND SURFACES

By

Cheryl A. Bellin

August 1993

Chairperson: P.S.C. Rao
Major Department: Soil and Water Science

Bioavailability and biodegradation of organic solutes in soils are

thought to be controlled by coupled sorption and transformation processes.

The principal hypothesis is that sorbed substrates are unavailable to

microorganisms. The fact that microorganisms may actively change the local

environment further complicates the issue by altering the magnitude and

kinetics of sorption and degradation. The importance of coupled sorption-

biodegradation processes is recognized in regard to the impact on

environmental contamination and bioremediation.

Bioremediation technologies have generally had limited success in

achieving adequate levels of cleanup, primarily because of constraints on

bioavailability of sorbed contaminants. Thus, understanding the interactions







among sorption, biodegradation, and transport processes is needed to

elucidate rate-limiting mechanisms of contaminant biodegradation.

Quinoline, an ionizable organic base, is a contaminant of interest found in

energy-derived waste materials and products. Batch reactors were used to

measure quinoline equilibrium sorption coefficients in the absence of physical

constraints. Miscible displacement studies were conducted to simultaneously

measure quinoline sorption and biodegradation. The quinolinium cation was the

predominant species sorbed via cation exchange. However, the bicontinuum

sorption nonequilibrium model was inadequate in describing the measured

breakthrough curves for quinoline displacement through "sterilized" soil

columns. Quinoline-surface complexes limit the desorption and redistribution

within the sorbent matrix and thus, are likely to be unavailable for degradation.

Addition of bacteria (quinoline-nondegrader) reduced quinoline sorption

and retardation in soil columns, which were attributed to biomass-induced

changes in quinoline speciation and blockage of surface sites. In columns

inoculated with a quinoline-degrader, quinoline was rapidly degraded and

biodegradation kinetics could not be measured. The continuously stirred flow-

through reactor was used as an alternate technique to monitor rapid

biodegradation kinetics (kb < 0.5 seconds'1) and to measure the response to

imposed perturbations. Introduction of sorbent particles at steady state (i.e.,

biodegradation of quinoline to 2-hydroxyquinoline and other metabolites)

resulted in two responses: 1) addition of soil particles required readaptation of

the bacterial isolate and caused reduced degradation rates; and 2) soil particles







reduced 2-hydroxyquinoline uptake and degradation, while quinoline

biodegradation was not altered. In this case, bacterial activity may have been

reduced upon bacteria-sorbent association.












CHAPTER 1
INTRODUCTION



The motivation for this dissertation arose from my desire to work with

microorganisms and to determine their potential for bioremediation of

contaminated soils, aquifers, and sediments. There is an illusion that bacteria

are fragile, delicate creatures. The reality of the situation, after working with

them for the last few years, is that they at times seem to have a mind of their

own. They have the capability to alter their environment in order to enhance

their very existence. I believe that their potential in bioremediation practices is

unlimited if we can only come to understand how they interact with their

environment. As Marshall (1976) stated:


It is my belief that many microbiologists fail to appreciate the effects of
interfaces on microbial populations, despite the widespread occurrence
of solid-liquid, gas-liquid, and liquid-liquid interfaces in natural microbial
habitats. ... Importance must be given to the nature, distribution, and
unique physicochemical properties of interfaces, the interaction between
microorganisms and interfaces, and the modifying effects of interfaces on
the ecology of microorganisms. (v)



Overview of the Problem

The improper use and accidental release of toxic organic compounds

into the environment have led to widespread contamination of soils and








aquifers. Treatment of contaminated materials has included excavation,

incineration, vapor extraction, and soil washing technologies. These treatments

are often costly and only result in a transfer of the contaminant from one phase

to another. However, implementation of above ground and in situ

bioremediation practices may lead to degradation of organic contaminants.

Bioremediation practices using laboratory tested microbial populations

have failed to achieve adequate levels of cleanup for reasons which will be

discussed. Failures are not surprising because frequently laboratory studies

investigate processes in isolation and attempt to extrapolate to field sites where

temperature, pH, soil water content, and microbial populations vary daily and

seasonally. As Rao et al. (1993a) so accurately described:


Most laboratory-scale experiments, and some field-scale studies, are
designed for investigating environmental processes in isolation; at least
attempts are made to do so by controlling most variables except the one
whose impact upon the system is being investigated. In real-world
scenarios, even in the simplest of laboratory experiments, however, the
rates and magnitudes of a reaction or a process are often controlled by
one or more other processes, each of which may have its own set of
unique control variables at different spatial and temporal scales. This is
indeed the case for laboratory experiments and field studies on fate and
transport of organic chemicals in soils and aquifers. An explicit
understanding of the coupling and feedback among simultaneous
processes is essential in explaining experimental observations and for
developing predictive models. (1)



To illustrate the importance of process coupling, Rao et al. (1993a)

presented two different scenarios. In one case, sorption renders the

contaminant unavailable for biodegradation and in the second case









biodegradation is unaffected by sorption. The first example suggests that

differences in biodegradation may be due to the soil sorption capacity and/or

variations in microbial activity. The second example suggests that differences in

biodegradation are due solely to variations in microbial activity and bioavailability

sorptionn of contaminants) is not a factor.

The use of bioremediation technology is hinged upon improving existing

knowledge of the controlling processes and their appropriate coupling such that

the probability and predictability of remediating a contaminated site are

increased. To fulfill this task it is necessary to 1) determine the reasons for

bioremediation failures; 2) develop predictive coupled-process models for

describing contaminant fate in the environment; and 3) determine the

ramifications of introducing bacteria or stimulating bacterial growth in soil and

aquifer materials to promote biodegradation of contaminants.

The success of bioremediation of contaminated soils and groundwater is

limited due to (1) the ability to degrade chemicals to an acceptable level and (2)

the ineffectiveness of laboratory-tested microorganisms to biodegrade

chemicals under field conditions. Understanding the physical and chemical

constraints of biodegradation in soils and aquifers may improve the designs of

bioremediation programs and provide an understanding of the reasons for

chemical persistence. Therefore, information is needed regarding microbial

transformations of organic chemicals in soil-water systems, as affected by the

interaction of chemical, physical, and biological processes.







4
A lack of consideration of physico-chemical and biological processes can

result in discrepancies between model predictions and experimental

observations. Investigation of organic chemical behavior in natural systems

and development of solute transport models that account for biodegradation

and sorption are necessary to adequately predict the environmental behavior of

such chemicals. These models can then be used to gain insight into the

processes that affect the fate of chemicals in the environment, for prescribing

management strategies that prevent or minimize groundwater contamination,

and for designing effective remediation procedures for contaminated sites.

Coupled-process models attempt to describe contaminant sorption,

degradation, and water flow by incorporating pertinent processes controlling the

fate of contaminants. Mathematical descriptions of existing coupled-process

models were reviewed by Brusseau et al. (1992). Development of an unbiased

coupled-process model requires a multidisciplinary approach. However, models

often contain a particular emphasis on a single process depending on the

researcher's background. The conceptual basis for the coupling of sorption

and biodegradation during transport was presented by Rao et al. (1993b).

Emphasis was given to the importance of adequately describing contaminant

sorption and the impact of the biomass on contaminant behavior.

Various levels of complexity arise when describing the processes that

control contaminant behavior. Frequently models are limited by the ability to

accurately measure the parameter of interest. When dealing with aquifer







5
materials, steady water flow is assumed. However, the unsaturated zone adds

seasonal variations in soil water content and temperature which directly or

indirectly impact the primary processes controlling the fate of contaminants. A

description of the sorption dynamics is primarily concerned with equilibrium or

rate-limited reactions, whereas microbial processes require descriptions of

microbial kinetics (e.g., growth and biodegradation) and biomass distribution.

Extensive data have been gathered describing individual processes that

determine the behavior of hydrophobic organic compounds (HOCs).

Equilibrium sorption coefficients (Kp) for HOCs can be estimated from aqueous

solubility and octanol-water partition coefficients among others (cf., Green and

Karickhoff, 1990; Gerstl, 1990). The sorption mass-transfer coefficients (k2) can

be estimated for a variety of soils and HOCs from the inverse, log-log

relationship noted between k2 and Kp (Brusseau and Rao, 1989a) or Koc

(Augustijn, 1993). Specific interactions between ionizable organic acids and soil

caused deviations from the behavior of HOCs (Brusseau and Rao, 1989a).

Complex sorption interactions of organic bases such as the nitrogen

heterocyclic compounds (NHCs) in soil have not been adequately investigated

to assess if this relationship is valid for NHCs.

The estimation of the model parameters related to biomass growth

dynamics of specific degraders and substrate degradation kinetics in soil and

aquifer materials is somewhat uncertain. Monod-type equations are used to

describe the behavior of pure culture systems. However, these models did not








adequately describe degradation in mixed culture laboratory systems (Scow et

al., 1986; Simkins et al., 1986). Therefore, these models are not likely to predict

field-scale observations. Blackburn (1989) claims that laboratory-scale

predictions of field-scale observations are destined to fail because of the

complexity of the spatial scales of interest (for further discussion see Rao et al.,

1993a). Blackburn (1989) suggested that the Heisenberg Uncertainty Principle

applies to microbial dynamics which states that by simply making an

experimental observation (since most experimental techniques are invasive,

though in some cases noninvasive techniques may be used), the system is

perturbed and is no longer an adequate representation of the original system.

Despite these arguments, complex degradation models have been developed

that incorporate availability of electron acceptors and electron donors, nutrients,

and the oxygen status in aquifers (Widdowson et al., 1987; 1988; MacQuarrie

and Sudicky, 1990). Because of the inability to describe the parameters at the

field scale, many of these models are not validated.

Existing coupled process models are highly limited by a lack of

experimental observations (laboratory and field scales) that quantitatively

demonstrate the effects of process coupling, specifically the manifestation of

such coupling on contaminant migration/degradation rates and profiles.

Laboratory studies coupling sorption, degradation, and transport are limited to

HOCs; most are conducted in batch reactors. The simultaneous sorption,

transformation, and transport of NHCs in dynamic soil systems has not been








studied. NHCs can exist in their protonated or neutral form depending on the

pH in the system. Therefore, to estimate the fate of these compounds, an

adequate representation of the appropriate linkages between the controlling

processes is essential. For these compounds, variations in pH will have

ramifications on the microbial community and their activity as well as on the

sorption dynamics. The following section is a review of the key processes that

control the fate of organic compounds and discuss the factors important in

developing a coupled- process model.


Sorption

The distribution of HOCs between the solid and solution phases is

characterized by an equilibrium sorption partition coefficient (Karickhoff et al.,

1979; Chiou et al., 1983). Most often the Freundlich isotherm is used:


S_ Kf C1/n (1-1)

where S is the sorbed concentration (gg/g), Kf = Freundlich sorption coefficient

[mL(1/n) 4g[1-(1/n)]/g], C = equilibrium solution concentration (Ag/mL), and 1/n

= Freundlich isotherm constant. Equilibrium sorption models are often used in

solute transport models. However, equilibrium assumptions are generally

inadequate in describing local-scale and field-scale sorption because

nonequilibrium conditions predominate.

Sorption nonequilibrium for HOCs can be described using the

bicontinuum model (Brusseau and Rao, 1989b). Conceptually, the model








describes partitioning of compounds into the soil organic phase or adsorption

of compounds onto surfaces. Nonequilibrium sorption is represented by a two-

step process in which sorption in the first domain is instantaneous, while mass

transfer constraints limit sorption in the second domain. Thin organic coatings

distributed throughout the soil may result in minimal constraints for sorption

mass transfer, whereas sorption into large organic particles may increase solute

diffusion due to limited accessibility of sorptive regions. Factors that limit the

rate of HOC sorption that have been proposed include intraparticle diffusion

(IPD) (Wu and Gschwend, 1986; Ball and Roberts, 1991) and intraorganic

matter diffusion (IOMD) (Brusseau et al., 1991). Regardless of the actual

mechanism responsible for rate-limited sorption, contaminants are likely to

reside within the interior regions of the sorbent matrix. The consequences of

this occurrence on biodegradation will be discussed in the next section.

Sorption of NHCs has been described by the Freundlich isotherm

(Zachara et al., 1986, Ainsworth et al., 1987). Linearity of the sorption

isotherms varied, approaching a linear isotherm at low concentrations and

surface coverages (Ainsworth et al., 1987). The protonated species is the

predominant form of NHCs sorbed and is expected to sorb primarily onto cation

exchange sites. These sites may be associated with phyllosilicate minerals or

organic matter. In either case, sorption is likely to be rate limited due to

migration into clay interlayers and aggregates or organic matter matrices.

Given the complexity of exchange reactions involving organic cations, the








bicontinuum model may not adequately describe the behavior of NHCs in soil

materials. This aspect will be explored further in a later section (see Chapter 2).


Biodegradation

Bioavailability

Biodegradation is a dominant mechanism affecting organic chemical

transformations in soils and aquifers. Microbial degradation of most small

organic compounds (molecular mass < 600) occurs intra-cellularly (Bitton et al.,

1988). Thus, the rate of biodegradation is limited by the dynamics of 1)

physical-chemical processes (e.g., solubility, sorption, hydrodynamic dispersion)

that leads to a lowering of solute concentration in the solution phase; 2) soil or

environmental factors that limit physiological activity of the appropriate microbial

consortia; 3) microbial factors that limit substrate uptake by the microorganisms

(e.g., cell permeability and hydrophobicity); and 4) intra-cellular genetic or

biochemical factors (e.g., presence of appropriate enzyme systems, presence

and expression of genes) that limits utilization of the compound. The

recalcitrance of different organic chemicals in a specific soil, or the variations in

degradation rates of a specific compound in several soils, may be explained to

a large extent by understanding these key factors.

Inoculation of soils and aquifers with microorganisms capable of readily

degrading chemicals may result in a partial or complete lack of contaminant

removal due to various environmental stresses not present under laboratory

conditions. Contaminant persistence may result from the following factors








(Madsen, 1985; Goldstein et al., 1985): 1) low substrate concentrations not

supporting microbial growth; 2) microorganisms encountering toxins or

predators; 3) microorganisms using more readily available carbon sources; and

4) introduced microorganisms not reaching the contaminated site.

Enhanced on-site or in-situ biodegradation provides a method for

removing organic contaminants in soils and aquifers. Utilizing indigenous

microorganisms is preferable to "inoculation" or injection because they are

already adapted to the local environment. However, in the subsurface

environment, the complex interaction between microorganisms, substrates, and

surfaces may alter this process. Biodegradation rates may be limited by

chemical properties of substrates, interactions of the substrate with surfaces, or

simply by the lack of necessary enzymes (Madsen, 1985). Availability of slightly

soluble substrates may be controlled by the rate of dissolution (Stucki and

Alexander, 1987; Miller and Bartha, 1989; Huang and Chou, 1990), or by low

aqueous concentrations which may not induce the necessary enzymes for

biodegradation (Madsen, 1985). Similarly, sorption of the substrate by soil may

reduce substrate concentrations in solution below levels necessary for enzyme

induction.

Sorption of substrates might also enhance biodegradation rates by

decreasing the substrate concentration to levels that are not toxic to

microorganisms responsible for degradation (van Loosdrecht et al., 1990).

Sorption more likely reduces or inhibits biodegradation rates in soils (Stotzky









and Rem, 1966; Madsen, 1985; van Loosdrecht et al., 1990). For example,

sorption was found to decrease the amount of substrate available to

microorganisms capable of degrading several compounds, including diquat

(Weber and Coble, 1968), benzylamine (Subba-Rao and Alexander, 1982; Miller

and Alexander, 1991), alkylamines (Wszolek and Alexander, 1979), glucose

(Gordon and Millero, 1985), 2,4-Dichlorophenoxyacetic acid (Ogram et al.,

1985), amino acids (Dashman and Stotzky, 1986), toluene (Robinson et al.,

1990), benzidine (Weber, 1991), quinoline (Smith et al., 1992), and flumetsulam

(Lehman et al., 1992). Degradation was adequately described by a second-

order rate equation with the assumption that only solution-phase chlorproham

and dibutyl phthalate are biodegraded in the presence of sediments (Steen et

al., 1980).

Biodegradation of contaminants may be limited when contaminants are

sequestered within the organic or inorganic components of the sorbent matrix

that are not directly accessible to microorganisms. Biodegradation may also

be limited by mass transfer (IPD and IOMD) from the interior of the sorbent to

the exterior solution. Bioavailability is limited in these examples because intra-

aggregate pores are too small to be accessible to bacteria (Steinberg et al.,

1987, Scow and Alexander, 1992). The substrate sorbed within organic matter

is accessible only after desorption or diffusion out of the sorbent matrix. Mass

transfer constraints have been shown for sorption/desorption of hydrophobic

organic compounds (HOCs) in soils and sediments (Wu and Gschwend, 1986;







12
Brusseau and Rao, 1989b; Brusseau et al., 1991), for biodegradation of HOCs

(Rijnaarts et al., 1990; Robinson et al., 1990), and for denitrification (Myrold and

Tiedje, 1985). For naphthalene, which exhibits reversible sorption/desorption

(Mihelcic and Luthy, 1988a,b), biodegradation was not dependent upon

desorption kinetics from fine-sized material (Mihelcic, 1988). For larger

particles, biodegradation of naphthalene was dependent upon intra-particle

diffusion from the solid-phase to the solution-phase, which suggests mass

transfer constraints or reduced bioavailability of the sorbed naphthalene

(Mihelcic and Luthy, 1988c).

For quinoline, highly selective cation exchange reactions may control

mass transfer from the soil to solution, thereby limiting biodegradation. Smith et

al. (1992) suggested that biodegradation of quinoline in dispersed clay

suspensions is limited by desorption of the highly stable quinolinium ion surface

complex. However, it is not known if these same rate-limiting steps control

biodegradation rates in soils and sediments or if diffusion-limited mass transfer

constraints (IOMD, IPD) are operative. For this reason, mechanistic models

coupling the sorption, degradation, and transport in soil and aquifer systems

are needed to understand the rate-limiting steps of organic chemical

biodegradation.


Effects of Surfaces on Biodearadation

At the cellular-scale, the influences of surfaces on bacterial activity have

been monitored indirectly in a variety of disciplines. Reported observations









suggesting the influence of surfaces on bacterial activity have been dismissed

because of possible secondary responses occurring at the surfaces (van

Loosdrecht et al., 1990). Ogram et al. (1985) demonstrated that sorbed 2,4-

dichlorophenoxy acetic acid (2,4-D) was protected from biodegradation and that

only the solution-phase 2,4-D was degraded by free and attached bacteria. The

degradative activity of free and attached bacteria, however, could not be

differentiated. In a similar study, 2,4-D was suggested to be degraded by

bacteria in the sorbed and solution phase (Zou et al., 1992); however,

degradation rates were thought to be faster by "free" bacteria rather than

sorbed-phase bacteria. Aamand et al. (1989) also suggested that only bacteria

in the solution phase were degrading the aquifer contaminants.

More recently, Guerin and Boyd (1992) argued that a bacterial isolate (P.

putida 17484) was capable of utilizing sorbed naphthalene from the surface,

contrary to the paradigm that degradation occurs intracellularly. Another

bacterial isolate (NP-Alk) was thought to be unable to degrade naphthalene in

the sorbed- phase. Therefore, organism-specific properties must be considered

in determining the potential for degradation. These observations will be

discussed further in Chapter 4. Determining the influence of surfaces on

biodegradation and whether or not bacteria have the ability to degrade

contaminants in the sorbed or solution phase is still unresolved. Further, a

predictive model requires knowledge of the distribution of the active microbial

biomass and microbial growth dynamics (e.g., contingent upon substrate,









nutrient, and electron acceptor concentration and bacterial population) in

combination with factors discussed above.


Biomass Distribution

Microbial biomass is subject to sorption and transport processes.

Therefore, bacteria may exist in the soil either sorbed (attached) or in solution

(free). Physical, chemical, and microbial factors controlling the distribution of

bacteria in porous media have recently been summarized by Harvey (1991),

Lindqvist and Enfield (1992b), and Tan et al. (1992). Bacteria grow after they

attach to surfaces if essential carbon and energy sources are available. Growth

and development of bacterial colonies generally is followed by the production of

extracellular polysaccharides and promote the formation of bacterial biofilms

(van Loosdrecht et al., 1990; Fletcher, 1991). Under nutrient- and substrate-rich

conditions, as may be the case near waste disposal sites, biofilms may be

formed.

Mathematical models for biodegradation are developed assuming that

the microbial biomass may be distributed in biofilms, microcolonies, or uniformly

throughout the porous medium (Baveye and Valocchi, 1989). The assumption

of microbial biofilms suggests that surfaces are uniformly coated by biofilms in

which the degradation of the contaminant and the utilization of the electron

acceptor takes place (Rittman and McCarty, 1980). The microcolony approach

suggests that bacteria exist in discrete microcolonies and that growth and

substrate utilization rates correspond to the microbial population (Molz et. al.,









1986; Marshall, 1992). Recent microscopic evidence suggests that bacteria

exist in microcolonies with bacterial cells extending out into the soil pore spaces

(Vandevivere and Baveye, 1992). The difficulty in mathematically describing the

dimensions of the biofilms and microcolonies limits the utilization of these

models in soils and aquifers. The uniform microbial description, commonly

used in solute transport models, makes no assumptions about the distribution

of bacteria (e.g., discrete colonies or biofilms) in solution or on the surfaces

(Corapicoglu and Haridas, 1985; Kindred and Celia, 1989). This concept

suggests that overall growth and metabolism are not influenced by the microbial

distribution.


Biomass Impacts on Contaminant Sorption and Transport

Growth or addition of bacteria may drastically alter the chemical, physical

and microbiological environment of soil surfaces (Fletcher, 1991). Chemical

properties of soil surfaces may be altered by bacterial biomass thereby

influencing contaminant transport (Stucki et al. 1992; van Loosdrecht et al.,

1990; Stotzky, 1966). Physical alterations including blockage of pores by

bacterial biomass and blockage of sorptive regions in the soil may occur

altering water flow and sorption contaminants (Tan et al., 1992; Vandevivere

and Baveye, 1992). Bacterial transport (e.g., solution phase bacteria) and their

facilitation of contaminant migration was recently demonstrated (Lindqvist and

Enfield, 1992a). The impact of bacterial biomass is becoming recognized as an

important process influencing contaminant sorption and transport (Rao et al.,







16
1993b). Therefore, the impact of bacterial biomass near hazardous waste sites

is of interest.


Environmental Factors Influencing Biodegradation

Environmental variables may be significant in surface soils where

microbial communities are in direct contact with the soil atmosphere. Seasonal

cycles in temperature and soil-water content distinguish this zone from aquifer

systems that may exhibit more constant conditions. Groundwater temperatures

are relatively constant; however, temperatures may be as low as 10 to 15C

which may reduce microbial activity. Surface fluctuations in temperate regions

may reduce bacterial activity throughout the winter months. In contrast,

bacterial activity will likely be high in warmer, tropical environments. Variations

in temperature over the usual range of interest (5-40C) are not likely to

influence the degradation pathway, only the rate of microbial degradation and

the microbial density. Changes in soil-water content, on the other hand, may

influence microbial communities and their activity.

Quantitative and qualitative differences result when observing aerobic and

anaerobic degradation. Deep, saturated aquifers may be depleted in oxygen

and bacterial populations may be limited by the availability of alternate electron

acceptors (NO3, SO4, CO3). In oxygen depleted zones, fermentation results in

incomplete degradation of contaminants. Flow heterogeneities may create

zones of mixing thus supplying adequate nutrients and cofactors to stimulate a

diverse and numerous group of microorganisms. On the other hand, a







17
contaminated area can turn an oxygenated aquifer into an anoxic region, if the

heterotrophic respiration exceeds oxygen input or recharge. In well-drained

soils and shallow aquifers, microbial populations are predominantly aerobic,

utilizing gaseous or dissolved oxygen as an electron acceptor which would

degrade organic contaminants to metabolites and ultimately mineralized to C02,

H20, and other elements. Even in a well-drained soil, however, anaerobic

regions (e.g., microsites) may develop as oxygen is depleted potentially altering

the end products of metabolism.


Biodegradation Models

Specific growth rates of microbial populations have been represented by

a variety of mathematical models (Pirt, 1975; Alexander and Scow, 1989; Bazin

and Menell, 1990). The empirical power rate model:


ac kbCn (1-2)


where kb is the biodegradation rate constant (1/T), simplifies to a first-order

kinetics model when n = 1 (Hamaker, 1972). Concern over the use of this

model is expressed as it is often presented with no theoretical justification for its

use (Bazin et al., 1976).

The description of the microbial growth rate when it is restricted by the

concentration of a growth-limiting substrate is given by the Monod equation

which was developed from enzyme kinetics:









A max --S (1-3)
Ks+S

where g is the specific growth rate of the biomass (1/T), Amax is the maximum

specific growth rate (1 /T), S is the substrate concentration (M/L3) and Ks is the

substrate half saturation constant (M/L3). This equation is commonly used to

describe the bacterial growth upon contaminant degradation.

Often, organic contaminant degradation is limited by availability of an

electron acceptor or an additional carbon substrate. The modified Monod

equation couples the dependence of bacterial growth on another carbon

substrate or electron acceptor:

A- [ S A mO] (1-4)
K T+S 4I<_+O

where 0 is the oxygen concentration (M/L3) and K0 is the oxygen half

saturation constant (M/L3). Equations may also incorporate an inhibition

coefficient to account for growth rate limitations due to a toxic feedback

mechanism (Harvey and Widdowson, 1992). In order to adequately describe

contaminant behavior, all parameters necessary for these models must be

measured at the particular scale of interest.


Transport

The governing differential equation that serves as the basis for most

coupled-process models used in soils and aquifers is









a(ec) [v D vq [v qC] [ ]a(PS) ,i (1-5)
at at

where C = solution-phase concentration (M/L3); S = sorbed-phase

concentration (M/M); t = time (T); p = soil bulk density (M/L3); 0 = fractional

volumetric water content dimensionlesss); D = hydrodynamic dispersion

coefficient (L2/T); x = distance (L); q = Darcy flux for water flow (L/T); and Oi

= rates (M/L3T) of loss or gain via various sinks and sources. In Eq (1-5),

multi-dimensional, advective-dispersive solute transport in a heterogeneous

porous medium under transient water flow conditions (first two terms on the

r.h.s.) is coupled to sorption dynamics (third term on r.h.s.) and biodegradation

kinetics (last term on r.h.s.). Differences in published models arise from the

specific manner in which sorption and degradation kinetics are modeled,

whether transient or steady flow is considered, and if one- or multi-dimensional

transport is of interest.

For one-dimensional steady, saturated water flow conditions in a

homogeneous medium, eq (1-5) can be restated as


8C DC vC C EaS + 1 (1-6)
at aW2 ax 9at -0

where v= (q/0) is the average pore-water velocity (L/T).

Assuming that sorption can be represented by the bicontinuum sorption

model with a Freundlich isotherm and that first-order biodegradation kinetics

apply to biodegradation (o = kbOC), eq (1-6) is restated as follows:









[1+C-k I ac -2 8C ac P S2_
[I+---P F] acn D2" D -v --.C kbC (1-7)
0 at ax2 ax 0 at


where kb represents the pseudo first-order rate constant (1/T) for

biodegradation (assumed to occur only in the solution phase), Kf is the

Freundlich sorption coefficient (mL0/n) jg[1-(1/n)1/g), and 1/n is the Freundlich

sorption isotherm coefficient. Note that the Freundlich model (eq 1-1) is used

to represent equilibrium sorption isotherms. Thus, isotherm nonlinearity may be

accounted for with this model which results in nonlinear mass transfer and

mixed order (1/n) equations. The model may be written in nondimensional

form (Nkedi- Kizza et al., 1989):


ac* +(,e R-1)(1/n)C*(1/n)-18 C*
ap ap

1 a2C* 1ac* ) yC (1-8a)
P ax2 aX ap


(1 R-)LaS: (C*(l/n)- S*) (1-8b)
at
by defining the following dimensionless parameters: C* = C/Co, p = vt/L, X =

x/L, y = kv/L, S* = [S2/1-F)KC(1/n)-1], R = [1 + ((p/0) KfCo(1/n)l)] is the

retardation factor, which represents equilibrium sorption; P = vL/D is the Peclet

number, which represents the hydrodynamic dispersion in the column;

p3 = {[1 + (Fp/6)KfCo'/n)-']/R} represents the fraction of instantaneous









retardation; o = {[k2(1-p)RL]/v} is the Damkohler number, which is

proportional to the ratio of hydrodynamic residence time (L/V) to the reaction

time (1/k2); L is the length of the column (L); F is the fraction of sorption in the

instantaneous regions; k2 is the first-order rate coefficient (1/T).

At the field scale, heterogeneous flow fields are often assumed to be

represented as being macroscopically homogeneous (MacQuarrie and Sudicky,

1990). The effects of local-scale pore-velocity variations are represented by a
"macrodispersion" term for the whole flow field. MacQuarrie and Sudicky (1990)

showed that such an approach can lead to a serious overestimation of

substrate degradation rate as a result of far greater mixing of the substrate and

dissolved oxygen plumes predicted to occur at the local scales when a macro-

dispersion concept is employed. This is a clear demonstration of the

importance of appropriately understanding local-scale physical heterogeneity in

explaining and predicting macro-scale observations of biodegradation.

Similarly, heterogeneities in the flow fields may create mixing zones where high

concentrations of electron donors (i.e., organic acids produced by fermentation

processes active in oxygen limited regions) and acceptors (i.e., oxygen) create

high microbial populations and degradation capacities.


Research Objectives

Over the past two decades, studying each factor that influences the

environmental behavior of organic chemicals in isolation has resulted in the

accumulation of an extensive database on several key processes. As Rao et al.

(1993a) pointed out:








Having made impressive advances in our understanding of the key
processes (transport, transformations, and sorption), it is now important
to examine the linkages between these processes. Coupled-processes
models provide the stimulus for a paradigm shift--from the reductionist
approaches to the relational approaches--where an investigation of the
inter-relations among the processes is considered even more important
than the examination of individual processes themselves. (8)


The primary objective of this dissertation research is to investigate soil-

solute-microorganism interactions and their importance in contaminant

persistence and transport in soil and aquifer materials. Reactions that are

important in coupling sorption, biodegradation, and transport of quinoline will be

investigated. From these results, the bioavailability of NHCs and thus, the

success of bioremediation practices will be assessed.

The following questions are proposed to address the following solute-

sorbent-microorganism interactions:

(1) Solute-sorbent What sorption processes limit bioavailability of

NHCs in remediation practices? Is the nonequilibrium sorption of

NHCs accurately described by the bicontinuum model?

(2) Microorganism-sorbent-solute: Do bioremediation practices

influence NHC sorption and transport?

(3) Solute-microorganism: What essential nutrient and oxygen

contents are required for biodegradation?

(4) Microorganism-sorbent Is bacterial activity (i.e., biodegradation)

altered in the presence of surfaces?







23
The following chapters address the questions stated above by studying

quinoline sorption and degradation. Quinoline, a NHC, is a contaminant found

in energy-derived waste materials and products and has the potential to be

transported to the subsurface soil and groundwater (Zachara et al., 1986).

Quinoline sorption has been characterized in batch systems using clay minerals

and soils. Desorption was recently shown to limit biodegradation of quinoline to

its primary metabolite (2-hydroxyquinoline) in batch systems (Smith et al., 1992).

In Chapter 2, process-level sorption kinetics of quinoline are examined and the

utility of the bicontinuum model is evaluated. Understanding the behavior of

quinoline sorption in flow through systems is necessary to determine the

processes controlling bioavailability. Equilibrium and mass transfer coefficients

for sorption and desorption were measured using batch and miscible

displacement techniques. The bicontinuum sorption model coupled with the

advective-dispersive solute transport model (during one-dimensional steady,

water flow) was used to assess the behavior of NHCs. This information was

then used to determine the rate-limiting processes controlling bioremediation

practices of NHCs.

The impact of biomass on the sorption and transport of three solutes

(naphthalene, 45Ca, quinoline) in a subsurface soil are investigated in Chapter

3. These compounds were selected because of their known interactions in soil

(i.e., cation exchange or hydrophobic partitioning). Miscible displacement

techniques were used to measure sorption and transport of the above








compounds during steady, saturated water flow conditions through

homogeneously packed, sterile or bacterial-inoculated soil columns. Pre-

inoculation of the Norborne soil with bacteria (108 cfu/g) simulates

contaminated subsurface soils and aquifers where bacterial populations may be

high. In this chapter I investigated the consequences of biostimulation practices

that attempt to remediate contaminated sites.

In Chapter 4, I explored the process coupling of sorption and

biodegradation of quinoline in flow through systems. First, growth limiting

factors were determined using miscible displacement techniques. This was

accomplished by monitoring breakthrough of quinoline and its primary

metabolite, 2-hydroxyquinoline, in bacterial-inoculated columns. Second, a

continually stirred, flow-through reactor was designed to monitor rapid

biodegradation kinetics and to assess the impact of surfaces on

biodegradation. These studies were used to determine processes important in

coupling sorption and biodegradation by investigating the impact of surfaces on

bacterial activity, and the conditions necessary for successfully remediating

contaminated sites.

Insights gained during my investigation of coupled processes and the

arduous task of dealing with living organisms are summarized in Chapter 5.

The significance, failures, and future opportunities of this research are also

presented in this chapter.












CHAPTER 2
CHEMODYNAMICS OF N-HETEROCYCLIC COMPOUNDS IN ABIOTIC
SYSTEMS: BATCH AND FLOW-THROUGH TECHNIQUES


Introduction


Sorption of NHCs may occur via cation exchange of the protonated

species on clay minerals or in organic matter and/or via partitioning of the

neutral species into organic matter. In contrast, sorption of HOCs occurs

primarily via "partitioning" into the organic phase. The dynamics of HOC

sorption have been conceptualized and described by the bicontinuum sorption

model (Karickhoff, 1980; Brusseau et al. 1991, Ball and Roberts, 1991).

However, the adequacy of this model to describe the behavior of NHCs is

uncertain.

Nonequilibrium sorption has been separated into transport- and sorption-

related processes. Transport-related nonequilibrium affects both sorptive and

nonsorptive compounds and results from heterogeneities in the flow paths.

When using non-aggregated media in packed-column laboratory studies,

transport-related nonequilibrium is generally determined to be negligible.

Sorption-related nonequilibrium results from specific solute-sorbent interactions

or diffusive mass transfer constraints. Organic matter is considered to be a

flexible polymer-like substance (Behar and Vandenbroucke, 1987) in which






26
diffusional constraints within the matrix (IOMD) cause sorption nonequilibrium of

HOCs. Nonequilibrium may also result from IPD (intraparticle diffusion) inside

microporous particles which contain organic coatings. HOCs are not likely to

exhibit chemical nonequilibrium because sorption occurs via partitioning

(Karickhoff et al., 1979; Chiou et al., 1983). Sorption of inorganic cations has

been shown to be rapid onto cation exchange sites and limited only by diffusion

to/from the exchanger surface (Nkedi-Kizza et al., 1989). Brusseau et al.

(1991) suggested that compensation of charge (i.e, cation sorption) likely

occurs near surfaces of organic matter; therefore, diffusional constraints of

HOCs and cations differ because of the path length and sorbent matrix.

Specific interactions of NHCs with the sorbent as well as and mass transfer

constraints within organic matter or phyllosilicate minerals are likely to limit

sorption of NHCs. Sorption of the quinolinium ion (i.e., cationic form of NHC)

onto predominantly organic matter associated CEC sites was suggested to be

faster than sorption of the neutral species (i.e., similar to HOCs) into the organic

matrix (Brusseau et al., 1991).

Quinoline, is a contaminant found in energy-derived waste materials and

products. Therefore, it was selected as a probe to evaluate the bicontinuum

sorption model and to further characterize the sorption dynamics of NHCs. A

first-order model did not adequately describe the complex interaction of

quinoline sorption onto clay modified alumina where 90% of the sites were

suggested to be readily available (Figure 2-1; Szecsody and Streile, 1992).









1.1


0.9


0.7
o
0
S0.5
U

0.3


0.1


-0.1


1


0.8


0.6
U

0.4


0.2


0


Figure 2-1. 0
p1
ar


Pore Volumes


0 50 100 150 200 250 300 350
Pore Volumes
alcium (0) and quinoline (o) BTCs: a) pH 6, v = 0.162 cm/s and b)
-H = 6.9, v = 0.063 cm/s. Lines correspond to equilibrium (solid)
id first-order models (dash). (from Szecsody and Streile, 1992).









Therefore, the mechanisms influencing quinoline sorption must be accurately

determined to assess the conceptual validity and adequacy of the bicontinuum

model.


Quinoline Sorption Dynamics

Figure 2-2 describes the ionization of quinoline between the protonated

(QH+) and neutral species (Q) as a function of pH. Mathematically, the

ionization of quinoline is represented by


QH+ Q0 + H+ (2-1)


Ka [Q][H+] (2-2)
[QH+]

where Ka is the ionization constant.

Sorption of quinoline has been characterized in batch systems using soil

and clay materials (Ainsworth et al., 1987, Zachara et al., 1988; 1990), and in

column studies using modified and pure clays (McBride et al., 1992; Szecsody

and Streile, 1992). Quinoline sorption was adequately described by the

Freundlich isotherm (see Chapter 1). These studies suggest that the

quinolinium ion (QH+) is the predominant species sorbed via cation exchange

at low concentrations. As surface coverage increases, quinoline likely

occupies lower energy sites and multiple layers of quinoline at the sorbent

surface may form. More importantly, sorption varies with pH reflecting quinoline

ionization (Fig. 2-2, eq 2-1) and preferential retention of the organic cation.













1.00


0.75 -D$
0+

. 0.50 pKa= 4.92
C.)
U-
0.25


0 2 4 6 8 10
pH


Figure 2-2. Quinoline speciation diagram and the protonated and
neutral species structures.







30
Sorption of the quinolinium ion has been shown even at pH values as much as

2 units greater than its ionization constant (pKa = 4.92) (Zachara et al., 1986;

Smith et al., 1992). Therefore, in a Ca+2 saturated homoionic soil, the following

cation exchange reaction can be used to describe quinoline exchange with

Ca+2:


CaR2 + 2QH -- 2QHR + Ca+2 (2-3)

where QH + is the aqueous concentration of the quinolinium ion, Ca +2 is the

aqueous concentration of Ca +2, CaR2 is the Ca on the exchanger complex, and

QHR is the quinoline on the exchanger complex. The equilibrium constant

describing this reaction is given as follows:

Ke = [(QHR)2 (Ca+2)] (2-4)
[(CaR2)(QH+) 2]

where () refers to the activity of QH + and Ca +2 in the solution and exchange

phase. The conditional equilibrium constant (Kex) or Vanselow selectivity

coefficient (K ) for eq 2-3 is depicted as


Kv [XQHR (Ca2)](2-5)
[XcaR2(QH )2I

where X is the mole fraction, (QH +) is the activity of QH + in solution, and (Ca +2)

is the activity of Ca +2 in solution. In eq 2-5, the activities in the exchanger

phase are represented by X. The selectivity coefficient (K) is related to the

equilibrium constant (Ke), if the reaction is reversible, by the relationship:











Kv Kex fca+ 2 (2-6)
f2


where the activity coefficients in the solid phase (f) of the exchanging ions

convert activity to mole fraction.

Quinoline and other NHCs form complexes with negatively charged solid

surfaces such as clay layer silicates (Zachara et al., 1986; 1987; 1988).

Selectivity coefficients (Kv) were developed for comparing the affinity of one

cation versus another to occupy a cation exchange site. The exchange of

quinoline and Ca +2 does not solely consider cation exchange because of the

strong quinoline-surface complexes. In this example, Kv includes the exchange

of quinoline and Ca 2 and the stability of the quinoline complexes on the

exchange phase. In eq 2-5, Kv > 1 indicates selectivity for QH + in the solid

phase whereas KV < 1 indicates Ca +2 is preferred. The high quinolinium

exchange selectivity coefficient on Na-montmorillonite (Kv = 200 to 1300) and

clay isolated from the Norborne soil (K, = 104 to 108) suggests that strong

quinoline-surface complexes are formed (Ainsworth et al., 1987; Zachara et al.,

1990). In these soils and pure clay minerals, Kv varied with pH and with

surface coverage which was suggested to be due to sorption of the neutral

species, occupation of high energy sites at low surface coverages, and surface

condensation. Reconfiguration of the quinoline molecule to a planar position

within interlayers of clay minerals may contribute to the hysteretic behavior

(Zachara et al., 1986; 1990) implying constraints to quinoline desorption. The








32
implication of this on quinoline transport in soils and aquifers will be examined in

a later section (Chapter 5).

A high Kv for quinoline suggests that quinoline may be favored over

inorganic cations on the exchange complex. Other NHCs (e.g., acridine,

pyridine), were shown to reduce quinoline sorption in low pH soils (4.7) where

compounds are protonated and sorption occurs via cation exchange (Zachara

et al., 1987). However, competition in soils where the neutral species

predominates (pH 7) was not apparent.

Predictive models have not been developed which adequately describe

the sorption and transport of NHCs (Szecsody and Streile, 1992). Sorption of

NHCs has been shown to be dependent upon the pH and cation exchange

capacity of the sorbent matrix. Therefore, accounting for these factors with an

individual parameter would enable the use of a predictive model for soils that

vary in their cation exchange capacity and pH. If the predominant sorption

mechanism is cation exchange, normalization of quinoline sorption to QH + and

the CEC of the soil of may be described by


S, KC1/n (2-7)

where S is the sorbed concentration [mol QH +/molc(-)], Ki = Freundlich-type

sorption coefficient [(L(1/rnmol QH +[-(n)/mol(-)], C, = equilibrium solution

concentration [mol QH +/L], and 1/n = isotherm constant. This relationship

resembles a Freundlich-type isotherm where the Kif describes the sorption of

NHCs accounting for variations in the cation exchange capacity and pH of the

soil.









The ion exchange of quinoline and Ca+2 in a system initially saturated

with Ca +2 was described in eq 2-5 and represented by KV. Freundlich

isotherms are not considered to be ion exchange isotherms. However,

assuming sorption of the protonated species onto cation exchange sites and

the fraction of the CEC occupied by quinoline is small, the K, may be related to

the Kv by the following relationship:


KV fc2 OH N Kv (2-8)




where N is the normality of the background electrolyte solution. However,

Zachara et al. (1988) predicted, based on eq 2-1, that the total sorbed quinoline

exceeded the fraction of quinoline existing as the quinolinum ion. Additional

sorption of quinoline could have been due to sorption of the neutral species,

clustering of the sorbate, surface condensation, or protonation of quinoline at

the exchanger surface (Ainsworth et al., 1987; Zachara et al., 1988). However,

measurement of enhanced acidity, thus, protonation of quinolinium at soil

surfaces, is not a trivial task. Sorption of the neutral species and cooperative

adsorption have been reported (Ainsworth et al., 1987) to occur at high surface

coverages via entropic or van der Waals forces.

Sorption of quinoline onto soils (pH 4 to 7) was thought to occur via

cation exchange in the presence of cosolvent mixtures [volume fraction of

cosolvent (f) < 0.4] (Zachara et al., 1988). Fu and Luthy (1986a) suggested

that cosolvents decreased quinoline sorption in response to an increase in









quinoline solubility. Quinoline isotherms at high concentrations (25 to 1000

mg/L) were suggested to be linear in water-methanol systems up to fo = 0.5

(Fu and Luthy, 1986b). Sorption at low concentrations (" 0.15 gg/mL) was

suggested to be nonlinear in aqueous systems (1/n = 0.75) and in

methanol/water solutions (20 vol % methanol; 1/n = 0.67) (Zachara et al.,

1988). Isotherm linearity has been shown to increase upon addition of

cosolvents for partitioning of solutes into an organic matrix; however, if ion

exchange predominates specific interactions with cation exchange sites may be

altered. For organic bases and acids, addition of solvents increases the fraction

of neutral species (Perrin et al., 1981; Lee, 1993). In the presence of

cosolvents, changes in the pKa values for organic bases are minimal (Perrin et

al., 1981). However, substantial increases in pKa values for organic acids have

been shown due to solute-solvent interactions resulting in decreased sorption of

phenolic compounds and increased sorption of carboxylic acids (fc > 0.2) (Lee,

1993).

Considering that the quinolinium ion sorption occurs predominately onto

cation exchange sites at low surface coverages, one could envision rate-limited

desorption of quinoline out of interlamellar regions of clay minerals and

aggregates or intra-organic matter regions. Such mass transfer constraints

delay the release of contaminants leading to persistence, inadequate

remediation, and limited bioavailability.









Research Question and Tasks

The primary objective of these studies are to investigate the process-level

kinetics of quinoline sorption by soils addressing the question: what are the

rate-limiting processes controlling bioremediation practices of NHCs?

Equilibrium and mass transfer coefficients for sorption and desorption were

measured as a function of pH, molarity (M) and sorbent. The bicontinuum

nonlinear sorption model coupled with the advective-dispersive solute transport

model was used to assess quinoline sorption and transport during one-

dimensional, steady water flow.


Materials and Methods

Sorbent

The soils used in this study and their properties are presented in Table 2-

1. Soils were sterilized for 30 min by steam autoclaving 50 g samples that were

brought to 15% water content and incubated for 24 hours. The process was

repeated two additional times and the soil was used in all subsequent

experiments unless otherwise noted. The soils used in the batch and column

experiments were initially saturated with Ca +2. Cation exchange measurements

were measured at the pH of the soil (See Table 2-1).


Solutes

Pentafluorobenzoic acid (PFBA; 150 mg/L) and 1-2O (6000 cpm/mL)

were used as conservative, nonsorbing tracers to assess the hydrodynamic









Table 2-1. Soil properties before and after steam autoclaving.

pH in 0.005 CEC location of
Soil M CaCl2 f0C cmol(-)/kg CEC

Eustis 5.3 0.0039 3.20 organic matter and kaolinitic
Sterile Eustis 5.4 0.0032 4.44 clay minerals
Norborne 6.4 0.0015 11.91 smectite clay minerals and
Sterile Norborne 6.4 0.0015 11.76 organic matter
Webster 6.9 0.037 47.9 organic matter and
smectite clay minerals


dispersion and extent of physical nonequilibrium conditions prevailing during

transport through the soil columns (Brusseau and Rao, 1989a). Quinoline

concentrations in the influent solutions for the column studies ranged from 4 to

10 mg/L. 'C-quinoline (Sigma) and spiked to obtain solutions at 10,000

cpm/mL. Batch studies were conducted for 2-Hydroxyquinoline (2-HQ) and

quinoline over the concentration range of interest at either 1 to 10 and 1 to 5

mass to volume ratios. Isotopic exchange of 40Ca and 45ca (6,000 cpm/mL)

was also investigated. Aqueous solutions of the chemicals were prepared in

filter-sterilized (0.2 pm) 0.005 or 0.05 M CaCl. Background matrix solutions

(0.005, 0.05 M CaCI2) were filter sterilized (0.2 gm) to minimize biodegradation

of organic solutes.


Experimental Setup

Batch techniques (Nkedi-Kizza et al., 1985) were used to assess

sorption/desorption kinetics and equilibrium constants for quinoline in sterile

systems. A stirred batch reactor was used to measure quinoline sorption









kinetics. The soil fraction < 50 gm was used in the stirred batch reactor to

minimize separation of the soil suspension. The soil fraction (2 g) was added to

150 mL 0.005 M CaCIl At various time intervals, the suspension was sampled

and immediately separated through a 0.45 jim teflon filter. The filtrate (C) was

analyzed to determine the quinoline concentration at various time intervals for 4

days. Flow-through column techniques (Brusseau et al., 1990) were utilized to

determine sorption rate coefficients for quinoline using sterile background matrix

solutions. The sterile soil was packed into a Kontes glass column (5 cm long,

2.5 cm i.d.). Bed supports on both ends of the column consisted of a teflon

diffusion mesh with a glass membrane porous filter (1 jim). The pumps and

tubing were disinfected by rinsing with methanol. The glass columns and

solution vessels were sterilized by autoclaving. After packing, approximately

150 pore volumes of 0.005 or 0.05 M CaCl2 solution were pumped through the

column to achieve saturated, steady water flow conditions. Experiments were

conducted under saturated, steady water flow conditions at pore water

velocities of 15 to 90 cm/hr. In displacement studies, the molarity (0.005 M,

0.05 M) and pH of the displacing solution were varied.

Solute concentrations were monitored continuously or by collecting

column effluent fractions. Flow through UV detection (Gilson Holochrome or

Milton Roy LDC) was monitored continuously at 230 nm for quinoline and 2-HQ

and 254 nm for PFBA. Detector response was recorded using a strip chart

recorder (Fisher Series 5000). Effluent samples were collected intermittently









and analyzed by HPLC-UV techniques (Gilson 115 UV detector, Gilson Model

302 pump, Waters WISP 710B autosampler, HP333492A Integrator) to verify

sample purity and to compare the initial solute concentration to the maximum

effluent concentration. Quinoline and 2-HQ were eluted from a reversed-phase

column (Supelco LCPAH column) at a flow rate of 1 mL/min with a mobile

phase of 10/10/80 (v/v/v) methanol, acetonitrile and water adjusted to pH 2

with HCI. Soil column effluent pH was monitored on-line using an Ingold

microelectrode (Lee et al., 1991). Effluent fractions of the radiolabeled

compounds were collected with an automatic sample collector (ISCO Model

273). The activity of each radiolabeled compound was assayed using a liquid

scintillation counter (Searle Delta 300).


Data Analysis

Retardation factors (R) were calculated from area above the BTC for

quinoline and naphthalene (Nkedi-Kizza et al., 1987); a linear extrapolation

technique was used to extend the BTCs to C/Co= 1 in order to estimate the

area above the BTC. For 45Ca pulses, the R was calculated by moment

analysis techniques (Brusseau et al., 1990). The curve fitting program CFITIM

(van Genuchten, 1981), which is based on nonlinear least-squares optimization

techniques, was used to estimate the Peclet number (P) from the BTC for

PFBA. For nonsorbed solutes (R= 1), two model parameters can be optimized:

P and the solute pulse size (J). Since the pulse size was determined

experimentally, only the value for P was estimated by fitting to the measured







39
BTC for PFBA or 3120p. For sorbed solutes (R> 1), five model parameters can

be optimized: P,R, /, o, and J. For 4"5Ca and naphthalene BTCs, R was fixed

(estimated as described above), J was experimentally determined, P was fixed

as the value estimated from PFBA BTCs, and the values of nonequilibrium

sorption parameters (8 and () were estimated from parameter optimization

using the CFITIM program. For quinoline BTCs, the curve fitting program

FLOINT (Brusseau et al., 1989) with nonlinear sorption isotherms was used to

estimate the parameters when flow interruption techniques were used to

enhance the investigation of sorption nonequilibrium processes.


Results and Discussion

Sterilization Techniques

Initial batch studies were conducted to characterize the sorption of

quinoline and to assess techniques used for soil sterilization. Batch sorption

experiments were conducted using three nonsterilized air-dry soils and two soils

sterilized by steam autoclaving techniques. Autoclaving had minimal effect

(<2%) on the properties of the Norborne soil (Table 2-1). CEC measured by

45Ca isotopic exchange (Babcock and Schulz, 1970) and the MgNO3 extract

procedure (Rhue and Reve, 1990) resulted in similar values for nonsterilized and

autoclaved soils (See Table 2-1). Measurement of 45Ca isotopic exchange over

time suggested that cation exchange on Norborne soil was completed within

the first 5 minutes. Isotopic exchange, thus, migration of 4"9a into the interlayer

exchange sites, was virtually instantaneous. The CEC of the Eustis soil









increased about 28% after autoclaving. The standard deviation of the CEC

estimates for this sample, however, was high. Nonuniformity in soil sampling

may have caused some of this error. On the other hand, the increase may

have been caused by release of organic acids, alteration of the organic matter

structure, or a change in the interfacial pH though the bulk pH is the same.

The soils (Table 2-1) varied in pH, cation exchange capacity, and location

of charge. The quinoline sorption isotherm, plotted on a log-log scale, was

normalized to the protonated species (QH +) in the sorbed and solution phases

and the CEC of the soil (mmol(-)/g). The sorption data for all soils can be

represented by a single scaled isotherm (Figure 2-3), suggesting that quinoline

sorption occurs primarily via cation exchange. Sorption isotherms were

nonlinear (1/n = 0.68 to 0.8) over the concentration range investigated. At

higher concentrations (Figure 2-3), sorption of quinoline increases in the

Norborne and Webster soil. The S-type sorptive behavior for these soils occurs

at high concentrations (100 mg/L), where > 95% of quinoline is present as the

neutral species.

Cooperative interactions between the sorbed species and multilayer

sorption has been suggested to enhance quinoline sorption clay minerals at

high concentrations (Ainsworth et al., 1987). However, at this concentration

less than 1% of the cation exchange sites are occupied by quinoline. This

behavior may result from aggregation of sorption sites where quinoline sorption

occurs in collocation with clay mineral aggregates or organic matter. The
















0
0


- D


Eustis
Sterile Eustis
Webster
Norborne
Sterile Norborne


EILE
El^
ev


ID
MC


I I I I


Log C, [mol QH+/L]


Figure 2-3.


Quinoline sorption isotherms for three soils normalized
to their cation exchange capacity and to the fraction of
protonated species (See eq 2-7).


0
E





0)
0


no


go41^








Eustis soil (pH 5.3) has a higher fraction of QH + present for the same initial

quinoline loading than the other soils (pH 6.4 and 6.9) (see Figure 2-2). The

isotherm nonlinearity for the Eustis soil remains constant at high concentrations

of QH +. This suggests that sorption of the neutral species may be occurring in

the higher pH soils. Another possible explanation is that high energy cation

exchange sites are the first sites occupied by quinoline, followed by sorption

onto lower energy sites such has been shown for sorption of inorganic

compounds (O'Connor et al., 1983).

Investigation of quinoline sorption kinetics suggested that sorption

occurred via a three step process (Figure 2-4). About 20% of quinoline sorption

occurred onto readily available or instantaneously accessible sorption sites.

These sites have typically been thought to exist on external regions of the

sorbent matrix (Brusseau and Rao, 1990). However, these sites may include

external sites or readily accessible internal sites depending upon the

architecture of the sorbent (Okuda, 1993). Sorption of quinoline occurs

predominantly on cation exchange sites located within organic matter and

smectite minerals. The slower rates of quinoline sorption likely correspond to

sorption and redistribution in the internal less-accessible regions of the sorbent.

In a binary solute batch system, quinoline sorption at low concentrations

was unaffected by the presence of its primary degradative metabolite, 2-

hydroxyquinoline (2-HQ), at pH 6.8 (Figure 2-5). The data points at the highest

quinoline concentration had the greatest amount of scatter in the data which


























0-


-0.1


-0.2 -

0
-0.3


-0.4


-0.5


-0.6
0


Figure 2-4.


N2


S 10 20 30 40 50 60
Time (hr)
Stirred batch reactor (a) and quinoline sorption onto
the Norborne soil fraction < 50 prm (b) (where C =
quinoline filtrate concentration and Co = the initial
quinoline concentration).


Soil
Suspension


















2HQ (mg/L) **
0 0
0 1
A5
*10

0
0







0

34 8 12
C (mg/L)
oo





0 4 8 12 1
C (mag/L)


Figure 2-5.


Sorption of quinoline on the Norborne soil in the
presence of 2-hydroxyquinoline.


70

60


50

..40

E 30


20

10

0









caused variation in the 1/n values. McBride et al. (1992) suggested that by

adding 2-HQ (5 and 20 mg/L) quinoline sorption in soil columns was reduced

as much as 23%. Competitive adsorption has been shown for NHCs such as

pyridine, quinoline, and acridine (Zachara et al., 1987) where the compounds

adsorb onto the same limited number of cation exchange sites. For HOCs,

competitive sorption is not likely because sorption occurs via partitioning (Chiou

et al., 1983). 2-HQ exists in its neutral form (pKa = 1.7) in the Norborne soil.

The predominant mechanism of 2-HQ sorption is hydrophobic partitioning, while

quinoline sorption occurs predominantly onto cation exchange sites. Therefore,

competitive sorption was not expected. If however, organic matter is located in

conjunction with the phyllosilicate minerals (Stevenson, 1985) quinoline sorption

may have been reduced due to the interference of 2-HQ and quinoline sorbing

in the same location of the organic matter-mineral complex. This behavior may

become more apparent in column studies (McBride et al., 1992) where

diffusional mass transfer constraints further limit sorption. These studies

suggest that 2-HQ production upon quinoline biodegradation is not likely to

reduce quinoline sorption by competing for available sorption sites.


Sorption Dynamics

Physical characterization. The 3H20 and PFBA breakthrough curves

(BTCs) for all soil columns were symmetrical and sigmoidal in shape (e.g.,

Figure 2-6) suggesting the absence of transport-related nonequilibrium. Peclet

numbers (P) were all greater than 80 indicating minimal hydrodynamic


















0 9*
0.


0 0

*


0
0O


0


00H


S 0 PFBA


0*

0.
0 *
00


1 2 3 4 5

Pore Volumes (p)


Figure 2-6.


Examples of breakthrough curves for PFBA and 3H20
in Norborne soil columns.


0.8


0.6


0.4


0.2


00
0








dispersion (Table 2-2). Slight retardation (R z 1.15) of BTCs for 3H20 on the

Norborne soil suggests that this tracer was sorbed. Sorption of 3H20 onto a

soil high in iron oxide content that contains predominately kaolinitic clay

minerals has been previously reported (Nkedi-Kizza et al., 1982). The Norborne

soil also contains iron oxides with 2:1 type clay minerals (Zachara et al., 1990);

thus, 3H20 sorption is likely. Sorption of 3H20 may indicate that water is

exchanged with hydrated sorbed ions on the clay surface (Szecsody and

Streile, 1992). Batch studies were conducted to measure 3H20 sorption onto

sterile Norborne soil. The sorption coefficient (Kd) was 0.03 (+ 0.001) mL/g.

These Kd values are consistent with retardation factor (R) values ranging from

1.09 to 1.12 observed in different columns. The pore volumes determined by

3H20 after correcting for sorption resulted in similar pore volumes as

determined using gravimetric methods, and the BTC data for displacement.

3H20 was not sorbed onto the Eustis soil (R ; 1.0).


Chemical characterization. Monitoring 45Ca and quinoline sorption and

transport under specific chemical and physical conditions (e.g., molarity of

solution, pH, and pore-water velocity) will help understand mechanisms

influencing quinoline behavior. The data for 45Ca and quinoline were utilized to

explore the accessibility of cation exchange sites by an inorganic cation and an

organic cation. Nonequilibrium sorption was explored by observing isotopic

exchange of both 45Ca/40Ca and 14C-quinoline/12C-quinoline, as well as the

exchange of quinoline for calcium. The behavior of these two solutes were









Table 2-2. Column parameters for sterile soil columns.


Column ID


CaCl2

mol/L


Norborne soil columns:
BQ5 0.005
A 0.005
B 0.05
BQ3 0.005
BQ8 0.005
BQ10 0.005
Floint 0.05
pH5.1 0.005
pH4.7 0.05

Eustis soil columns:

BQ2 0.005
DCMA 0.005


p e

pH g/cm3 mL/cm3


1.48
1.49
1.54
1.48
1.47
1.45
1.42
1.47
1.51


5.3 1.79
5.3 1.75


0.44
0.45
0.42
0.44
0.49
0.45
0.44
0.44
0.47



0.32
0.33


*nd = not determined


compared in a soil where sorption occurred primarily in organic matter (70%)

and kaolinitic minerals, and in a soil where sorption occurred primarily on

smectite type minerals and organic matter.

Figure 2-7 shows the BTC for 45Ca in 0.005 and 0.05 M CaCl2. The

retardation factor for 45Ca in the 0.005 M CaCl2 soil column is 37.6, whereas

the R in 0.05 M CaCl2 is 5.0. The sorption coefficient (Kd) of 45Ca is related

directly to the CEC of the soil, and inversely to the normality (N) of the

background electrolyte solution (Kd CEC/N) (Wilklander, 1964). Therefore, a

factor-of-ten increase in N should result in a 10-fold decrease in Kd. This was

indeed the case for sorption coefficients for 45Ca in the sterile 0.005 M CaC12


80
137
108
190
nd*
nd
120
97
nd



110
84
















L U JL U iU
E cP. oo...
* 0 0 0


ED a


18h


0

S




> 19.2 h

17.8 h


Flow Interruption


- 0



- DO


20


U

U


U


40


Pore Volumes (p)


Figure 2-7.


Quinoline and 45Ca breakthrough curves with flow
interruptions in 0.005 M (closed symbols) and 0.05 M
(open symbols) CaCL2 Norborne soil columns.


0.8




0.6




0.4




0.2


o Quinoline pH 6.2

* Quinoline pH 7

S45 Ca

45Ca


. . i c i iI









column (1.0 mL/g) and 0.05 M CaCl2 column (11.0 mL/g). In contrast, ionic

concentration molarityy) of background matrix had minimal impact on quinoline

sorption at pH > 6.2 (Figure 2-7). The pH of the 0.005 M CaCl2 column is 7

and the pH of the 0.05 M CaCl2 column is 6.2. The fraction of protonated

species is greater at pH 6.2 (5%) versus pH 7 (1%). The decrease in pH in the

lower background matrix concentration (0.005 M) column may compensate for

the decrease in sorption due to higher ionic concentration. Batch studies at pH

6.2 for 0.05 M CaCl2 and in pH 6.8 for 0.005 M CaCl2 suggest that sorption

(Kd) is greater (z11%) as the molarity of the background matrix solution

decreases. Charge compensation in the diffuse double layer at higher

electrolyte concentrations may reduce the sorption of quinoline. In a subsoil

with a pH 7, the effects of ionic strength on quinoline sorption were negligible

(Zachara et al., 1986).

The influence of pH is evident upon comparing the BTCs in Figure 2-7

and 2-8 at the same background electrolyte concentrations. A decrease in pH

results in a increase in quinoline sorption. Increased sorption at lower pH

values is expected based on the increase in the fraction of QH The influence

of background electrolyte concentration was not clearly determined. Previous

investigation suggested that sorption decreased 60% at pH values near its pKa

when the ionic strength increased from 0.001 to 0.1 M CaCI2 (Helmy et al.,

1983; Zachara et al., 1986).




















0.8


0.6


0.4


0.2


0 50 100 150 200
Pore Volumes (p)


Figure 2-8.


Quinoline breakthrough curves in 0.005 M (closed
symbols) and 0.05 M CaCI2 (open symbols) in pH
adjusted Norborne soil columns.


250









Measuring the influence of background electrolyte concentration on

quinoline was confounded by a simultaneous change in electrolyte

concentration and pH (Figure 2-7). Poising the soil pH at some value other

than the natural pH is often difficult. Repeated flushing of the soil column with

0.005 M CaCI2 resulted in a pH 6.9. The final pH after flushing the soil

column with 0.05 M CaCl2 ranged from 6.2 to 6.4, decreasing the pH about 0.6

pH units. As the pH of the soil approaches the pKa of the compound of

interest, sorption is increasingly sensitive to slight pH changes (Figure 2-2).

Therefore, sorption measurements of ionizable compounds must be conducted

at a constant pH.

The use of nutrient solutions was shown to alter the sorption of quinoline

(McBride et al., 1992). As a result, use of buffers was avoided. To alter the soil

pH, HCI may be added to the system. The addition of other ions may change

the overall ionic strength and the cation exchange complex, thereby influencing

quinoline sorption and possibly the phyllosilicate mineral structure. A titration

device was used to maintain a constant pH of soil-suspensions while quinoline

sorption was measured (Zachara et al., 1990). However, this procedure does

not lend itself to use in flow-through column techniques. In these column

experiments at the lower pH values, the background electrolyte solution was

adjusted with HCI and flushed until the pH was essentially constant ( 0.3 pH

units). Soil columns were flushed at 0.5 mL/min for about 2 weeks. Additional

acid was not added to adjust the pH of the quinoline solution due to changes in









electrolyte concentrations and ionic composition. Therefore, the pH was not

adequately controlled. Experimental techniques must be carried out with the

utmost detail when investigating the behavior of ionizable compounds. A

controlled experiment with the system poised at a particular pH value has not

been conducted to accurately measure the influence of ionic strength on

quinoline sorption in soil columns.


Flow interruption. The accessibility of the cation exchange sites (i.e, clay

interlayer positions and organic matter) was evaluated by examining the

dynamics of 40Ca/45Ca isotopic exchange and exchange of quinoline for 4Ca.

The 45Ca BTC was symmetrical and showed about a 5% drop in concentration

after an 18-hour flow interruption in the 0.005 and 0.05 M CaCl2 columns

(Figure 2-7). This suggests that cation exchange and diffusion into clay

interlayer sites and organic matter regions was rapid, and that near equilibrium

conditions were attained under flow conditions for the column. Flow

interruptions suggested that migration of 45Ca into interlayer sites and organic

matter matrices was not limiting mass transfer or isotopic exchange kinetics.

Szecsody and Streile (1992) also found isotopic exchange of 40Ca/45Ca to be

rapid in columns packed with clay-modified alumina. Exchange of 40Ca/45Ca in

organic matter was rapid and not limited by mass transfer into the organic

matrix (Nkedi Kizza et al., 1989). They speculated that the compensation of

charge may occur at the exterior of the organic matter matrix and Ca does not

necessarily need to migrate within the sorbent.









Considerable asymmetry of the quinoline BTC at pH 7 in the sterile

Norborne soil (0.05 and 0.005 M CaCl2) is indicative of nonequilibrium behavior

during displacement of quinoline for 4Ca (Figure 2-7). A large drop in effluent

concentration (;35 to 50%) during the flow interruptions greater than 17 hours

indicates strong nonequilibrium behavior (Brusseau et al., 1989). Figure 2-9

shows the nonequilibrium behavior upon repeated flow interruptions in the 0.05

M CaCl2 Norborne soil column at pH 6.2. The first flow interruption (at 20

hours) results in a 50% drop in concentration. Subsequent flow interruptions

(24 hours) suggested that quinoline sorption is rate-limited into interlayer

positions of phyllosilicate minerals and possibly into interior regions of organic

matter matrices.

Symmetrical BTCs for PFBA and 3H20 preclude physical nonequilibrium

constraints (e.g., mobile-immobile water) as a possible reason, and 45Ca cation

exchange was rapid. Therefore, quinoline sorption nonequilibrium must be due

to other constraints.

O'Loughlin et al. (1991) reported that sorption of a N-heterocyclic

compound (2-methyl pyridine) into 2:1 clay interlayers was rate-limited, whereas

sorption onto edge-sites of kaolinite was rapid which suggests that steric

hindrances are limiting sorption. However, similar molecular dimensions of

quinoline (1.02 nm X 0.76 nm x 0.36 nm; Weast, 1984) and hydrated Ca (0.6

nm; Bohn et al., 1979) suggest that size considerations alone are not likely to

account for the observed sorption nonequilibrium of quinoline. Szecsody and


































20
Pore Volumes (p)


Figure 2-9.


Figure 2-9.


Repeated flow interruptions for quinoline in a 0.05 M
CaCl2 (pH 6.2) Norborne soil column and bicontinuum
model fit.


0.8


0.6


0.4


0.2


40








56
Streile (1992) attributed sorption nonequilibrium to kinetic constraints from site-

specific chemical processes between the quinoline and montmorillonite. Over

the concentration range used in this study, the protonated form is likely the

predominate species sorbed via cation exchange. In the bulk solution of the

soil columns, quinoline exists essentially in the neutral form. Zachara et al.

(1990) demonstrated that even when pH values are pH (pKa +2) and most of

quinoline exists in its neutral form, the quinolinium ion is still the predominant

form sorbed. In addition, surfaces can be up to 2 units lower in pH than the

bulk solution pH (Bates, 1973) and protonation reactions are rapid. Therefore,

availability of quinolinium ions in solutions is not likely to limit sorption.

The bicontinuum model provided an inadequate description of quinoline

behavior in Norborne soil columns (Figure 2-8, 2-9). The frontal portion of the

curve adequately describes the rapid access to the easily accessible external

sites. Nonlinearity of the quinoline sorption also caused self sharpening of the

front of the BTC. The model fits were optimized for nonequilibrium parameters

B and o (Table 2-3), and are shown in Figure 2-9. The quinoline displacement

in the column adjusted to pH 4.7 was conducted at 0.5 mL/min, whereas

displacement studies in the other three columns listed in the Table 2-3 were

conducted at 2 mL/min. The Norborne soil has 0.16% organic matter in

addition to smectite clay minerals. The large fraction (0.5) of sites

instantaneously accessed by quinoline was attributed to sorption on edge sites

(as much as 20%) and easily accessible interlamellar sites of smectite minerals












Table 2-3. Summary of estimated transport parameters for quinoline.

ID pH R Kf 0 B F k2

BQ5 7.0 11.0 3.18 0.762 (0.52-1.0) 0.536 (0.47-0.59) 0.493 1.336
Floint 6.2 12.6 3.87 0.814 (0.41-1.22) 0.508 (0.43-0.59) 0.466 1.337
pH4 4.7 28.6 8.58 0.178 (0.17-0.18) 0.821 (0.79-0.85) 0.814 0.074
BQ10 3.0 140 43.1 0.261 (0.11-0.41) 0.503(0.26-0.75) 0.499 0.041
BQ2 4.75 0.69 1.727 (0.98-2.47) 0.507 (0.41-0.60) 0.375 8.286
DCMA 5.3 11.0 1.82 0.984 (0.39-1.58)) 0.535 (0.42-0.65) 0.488 2.615

values in parenthesis are 95% confidence intervals.


and exterior regions of organic matter. Simultaneously describing the large

fraction of instantaneously accessible sites and the slow redistribution of

quinoline within the clay interlayers is not possible using the bicontinuum model.

Therefore, rapid sorption of the quinolinium ion followed by the rate-limited

diffusion of quinoline into the phyllosilicate minerals is not an accurate

conceptualization for quinoline sorption.

Specific chemical interactions (e.g., hysteresis, reconfiguration of the

molecular arrangement) likely limit desorption, and steric hindrances may limit

redistribution within phyllosilicate minerals. The molecular configuration was

suggested to change from an upright position to a planar position within clay

minerals (Zachara et al., 1988). As a result, desorption is strongly inhibited due

to delocalization of charge over the entire molecular surface. Subsequent

migration within interlamellar regions may be restricted due to desorption and









redistribution of the quinoline molecule and limited accessibility due steric to

hindrances.

The significance of the interlayer spacing in this smectite clay mineral

during quinoline sorption is apparent, given that the majority (up to 80%) of the

charge associated with the clay mineral originates in the interlayer spacing from

isomorphic substitution. The predominant form of clay in the Norborne soil is

biedellite which is characterized by substitution of Al+3 for Si+4 in the

tetrahedral layer. The clay fraction was isolated from the Norborne soil and

prepared for X-ray diffraction to measure changes in d-spacing upon

replacement of quinoline for 40Ca. Mounts were prepared by placing a known

amount of clay suspension onto a clay tile and saturating with 1 M CaCI2. The

sample was rinsed with deionized water to remove excess Ca. The tile was

equilibrated for about 48 hours at both 56 and 87 % relative humidity and the d-

spacing was measured. Sufficient quinoline was then added to the clay tile to

occupy 1% of the total sites. Measurements of the d-spacing were repeated at

56 and 87 % relative humidity. A decrease in the d-spacing upon addition of

quinoline would indicate the collapse of the clay interlayers and a potential

source of nonequilibrium sorption.

No obvious changes in d-spacing were indicated in the 1% quinoline

saturated samples compared to the Ca saturated samples at either relative

humidity. A decrease in the d-spacing was detected upon decreasing the

relative humidity. The d spacing was 1.6 nm at 87% relative humidity of which









0.92 nm is occupied by an octahedral and tetrahedral layer. Therefore, the

interlamellar region is approximately 0.68 nm. This procedure was limited by

the fact that only 1 % of the total CEC sites were occupied by quinoline; 99% of

the exchange sites were occupied by Ca. Therefore, no changes were

detected. To enable the detection of d spacing changes a larger fraction of

sites would need to be saturated with quinoline. However, saturating the

exchange complex with quinoline would likely alter the sorption mechanism and

would not be comparable to low quinoline concentrations (see Figure 2-3).

Figure 2-10 conceptualizes the process hypothesized for quinoline

sorption onto smectite clay minerals. The size of the interlayer spacing of the

smectite clay, the Ca, and quinoline are approximately drawn to scale.

Quinoline replaces Ca on edge and readily accessible interlayer CEC sites

(Figure 2-10a), representing the fraction of instantaneous sites (F) associated

with the clay minerals. After this initial step, quinoline must desorb and migrate

further within the interlamellar region of the clay mineral. Displacement of Ca

by quinoline in interlayer regions may be physically constrained (Figure 2-10a),

which may contribute to sorption nonequilibrium. Ca is hydrated and initially

occupies CEC sites in the interlayer positions. Smith et al. (1992) suggested

that quinoline displaced interstitial water upon reorientation to a planar position

on the surface. Therefore, the hydration energies associated with quinoline and

40Ca may be important in understanding rate-limitations of quinoline sorption.



















Reorientation of quinoline to planar position

( )
^^\ $I0


Redistribution of quinoline within clay interlayers





Collapse of clay interlayers
Figure 2-10. Conceptual diagram of quinoline sorption onto smectite clay minerals.


0 0
r^








Quinoline may also be drawn into a planar orientation (Figure 2-10Ob)

delocalizing the charge over the whole quinoline molecule. At this stage,

quinoline molecules in the solution phase may pass further into the interlamellar

regions of the clay mineral due to compensation of the electrostatic charge by

the previously sorbed quinoline molecule (Figure 2-10c). Some of these sites

may essentially be inaccessible once quinoline has occupied the interior of clay

minerals and formed a stable surface complex. After breakthrough and

washout of quinoline from the Norborne soil columns, mass balance suggested

that 5 to 10 % of the quinoline introduced into the column remained on the soil.

Repeated washing with 80% methanol was insufficient to completely wash out

residual quinoline within the interior clay aggregates. Introduction of a cation

more selective for the exchange complex than quinoline would be a more

efficient method for removing quinoline from the exchange complex.

The inability to successfully remove residual quinoline from interlayer

positions further supports that strong quinoline surface complexes are formed

or that the interlayers have collapsed (Figure 2-10Od). This depicts the

tetrahedral layer charge being drawn to the quinoline molecule and collapse the

interlayer spacing restricting further migration into this region. Electrical

neutrality must be maintained at all times suggesting that two quinoline

molecules must replace one calcium. Therefore, the total collapse of the

interlayer regions is not likely. However, formation of strong surface complexes

and several molecules sorbed in the interlayers may create a buildup of

molecules redistributed throughout the interlamellar region.









Isotopic exchange of 12C-quinoline/14C-quinoline was measured to

determine the exchange of quinoline molecules during displacement with 0.05 M

CaCl2 in a Norborne soil column (Figure 2-11). The breakthrough of quinoline

was first monitored in a 0.05 M CaC12 background matrix solution. After 7 flow

interruptions (3 shown in Figure 2-9), the equilibrium solution concentration was

98% of the influent concentration. At this point, a solution of 14C-quinoline and

12C-quinoline (same total concentration) in 0.05 M CaCI2 was introduced into

the column. The breakthrough of 14C-quinoline was delayed following

preconditioning with 12C-quinoline and the drop in relative concentration (25%

versus 50%) during flow interruption decreased. Apparent increased retention

(delayed breakthrough) in the 14C-quinoline column may have been caused by

decreased pH (6.1). However, the change in pH causes about a 1% increase

in the fraction of QH+ and it is not likely to cause this shift in breakthrough.

Two cases will be presented as alternatives for the isotopic exchange data.

First, the decreased drop in relative concentration of the 14C-quinoline versus
12C-quinoline BTC suggests that equilibrium is more readily approached by 14C-

quinoline. A decrease in rate-limited sorption sites would result in a reduced

drop during the flow interruption. This may occur if quinoline surface

complexes are formed in interlamellar regions. However, this would

simultaneously decrease cation exchange capacity, resulting in early quinoline

breakthrough (lower R). In fact breakthrough was delayed, therefore, this was

reasoned not to be a viable option.



















0 0
0
0.*
0 *
0 0
0 0
0
0 *

0.


f
o.


0O


0 *)
*oe* 0
o
*0 0


40


20
Pore Volumes (p)


Figure 2-11.


Isotopic exchange of 12C-quinoline and 14C-quinoline
in 0.05 M CaCl2 (pH 6.2) in the Norborne soil.


0
P00


0.8



0.6



0.4


0.2


0 12 C-Quinoline

* 14 C-Quinoline


10


r-









Another possibility is that the 140C-quinoline approaches equilibrium more

rapidly than the 12C-quinoline. The sigmoidal shape of the BTC for 14C-

quinoline is indicative of equilibrium sorption and a linear isotherm is expected

from exchange of 12C- and 14C-quinoline. Quinoline sorption isotherms were

nonlinear 1/np0.7 in batch systems upon exchange of quinoline for 4Ca. The

self-sharpening front for the 12C-quinoline BTC is indicative of nonlinear sorption

(Brusseau and Rao, 1989b). The sharp front may also indicate nonequilibrium

conditions suggesting access into the interlayer positions and replacement of

calcium is difficult. Initial access of quinoline into interlayer positions may

enhance subsequent access of interlayer regions due to charge compensation

and reorientation (Figure 2-10c). To test this hypothesis, a BTC of 14C-

quinoline on the backside tail (5-10% residual quinoline) could be conducted. If

the sharp front occurred on the BTC then it would suggest that as the percent

of quinoline on the exchange complex increased access to other interlayer sites

would increase.

From these two cases, nonequilibrium conditions prevail upon

introduction of quinoline, suggesting that some sites are extremely constrained

by diffusional and chemical factors. A fraction of the sites are considered to be

unavailable and thus, bioavailability is likely to be limited.

In the pH 3 and pH 4.6 columns, the minimal drop in effluent

concentration during flow interruption (Fig. 2-6) suggested that quinoline

sorption is near equilibrium. However, the relative concentration only reaches









95-98% after the flow interruption. In the pH 6.2 column, C/Co approached 1

rapidly after the flow interruption. In the pH 6.2, 4.7, and 3 columns, the flow

interruption resulted in a 50, 18, and 2% drop in relative concentration,

respectively. Diffusion into clay interlayer positions is pH dependent. At first

glance it appears that nonequilibrium is greater at higher pH values. However,

as the pH decreases the fraction of protonated species increases and R

increases which may alter access into these regions. A larger R, a highly

selective exchange coefficient, and steric hindrances may further limit quinoline

entry into the clay interlayer positions. Rate-limited sorption of quinoline may be

related to both the magnitude of selectivity coefficients (Ainsworth et al., 1987)

and the ability of quinoline to delocalize its charge over the entire surface of the

compound (Zachara et al., 1990).

Replacement of hydrogen ions for 40Ca on exchange sites may alter the

clay interlayer environment, thus, quinoline migration into interlayers. As a

result, the ability to access interlayer positions as the pH decreases may be

further constrained. It may be possible that mass transfer is restricted beyond

the time allowed for flow interruption (8.8 h, pH 3 column), modeling the data

assuming flow interruption occurred for a longer period of time (16.6 d) would

result in a large drop during flow interruption. The model fit (granted the error

associated with the use of this model) suggests that mass transfer is more

constrained than indicated for the 8.8 hour flow interruption. However, a flow

interruption for as much as 10 days in a pH 5 column resulted in only an 8%









drop in the relative concentration and approached a relative concentration of

98%. The k2 values determined from model fits for the lower pH columns are

less than the higher pH columns (Table 2-3). Sorption is about 25 times faster

at higher pH values than in lower pH soils. The trend indicates reduced access

to interlayer positions as pH decreases.

Consideration must be given to differences in the nature of organic

matter versus clay minerals in describing the quinoline sorption. Diffusion of

quinoline into interlamellar regions was suggested to be rate-limited. However,

sorption of quinoline into organic matter matrices was not clearly defined in the

Norborne soil due to the presence of smectite clay minerals. Therefore, column

studies were conducted on a Eustis soil where a majority of the CEC is located

in the organic fraction of the soil and the remainder are associated with the

kaolinitic clay minerals.

A large drop in effluent concentration (;35%) during the 17.8 hr flow

interruption in the Eustis soil column is indicative of nonequilibrium sorption into

organic matter matrices (Figure 2-12). It was suggested that sorption of the

neutral species behaved similarly to HOCs (IOMD), while sorption of the

quinolinium ion onto exterior regions of organic matter was rapid (cation

exchange) (Brusseau et al., 1991). However, flow interruption techniques

enhanced detection of sorption nonequilibrium and suggested that

nonequilibrium conditions predominated in organic matter matrices (Eustis soil)

and phyllosilicate minerals (Norborne soil). Access to rate-limited sites was





















CP0O


0 0
0


00 0
0


0 15.5 h
7/
* 15.5 h


Flow
Interruption


07 Oete
0
0


23h
23 h


Pore Volumes (p)


Figure 2-12.


Breakthrough curves of quinoline in Eustis soil with
0.005 M CaCI2 and 30% methanol.


0.8


0.6


0.4


0.2


0*


0


0

0
I-,.


* 0.01 NCaCI2

o 30 % Methanol







68
suggested to be faster into the organic matter matrix than into the clay minerals

(Table 2-3). Organic matter is thought to be a flexible deformable organic

polymer; therefore, migration into this type of matrix may be less restricted than

into interlamellar regions of clay minerals.

Nonequilibrium due to IOMD arises due to restricted diffusion within the

polymer-like matrix of organic matter (Brusseau et al., 1991). Specific

interactions of quinoline with functional groups of organic matter are likely to

change the nature of this flexible organic polymer. Redistribution of charge

upon migration of quinoline within the organic matter may cause the matrix to

collapse around the quinoline molecule and restrict diffusion. Brusseau et al.

(1991) suggested that Ca sorption occurred at the exterior or the organic matter

because of the long range interaction of electrostatic charge. Alternatively, Ca

migration into interior regions of organic matter may be rapid. The

nonequilibrium behavior of quinoline suggests that quinoline migration into the

interior regions of the organic matter is rate limited. Hydrophobic and cation

exchange interactions may occur with the quinoline molecule due to charge

separation on the molecule.

Figure 2-13 is a proposed schematic diagram of organic matter (B6har

and Vandenbroucke, 1987). The structure is composed of regions of randomly

distributed hydrophobic and hydrophilic regions comprised of aromatic and

aliphatic structures, respectively. Envision quinoline migration into this organic

matrix: specific interactions between quinoline and hydroxyl groups may occur
















0
N-


\;,^^0 0


00/ 0 ( 0




NH ...
20








Figure 2-13. Structural representation of organic matter (adapted
from Behar and Vandenbroucke, 1987).








70
followed by redistribution of charge and reconfiguration of the matrix around the

quinoline molecule. The hydrophobic portion of the molecule may associate

and partition into the aromatic region.

Addition of cosolvents increases solubility of organic compounds and

decreases sorption. In addition, the organic matter matrix may swell, increasing

accessibility to the interior of the organic matter matrix thereby reducing

sorption nonequilibrium (Nkedi-Kizza et al., 1989; Lee et al., 1991). However,

the fraction of instantaneous sites (F) decreased as the matrix swelled because

the surface area to volume ratio decreases (Lee et al., 1991).

Other specific solute-solvent and solvent-sorbent interactions increase the

complexity of describing sorption of ionizable organic compounds in mixed

solvents systems (Lee et al., 1992). The pKa of acidic functional groups

associated with the sorbent may increase upon addition of solvents (Lee et al.,

1992). Thus, in the presence of solvents at a given pH, the functional groups

become more neutral and reduce electrostatic interactions. In addition, the pKa

of the quinoline decreases upon addition of cosolvents. Therefore, at a given

pH the amount of neutral species present increases. These solvent-sorbent

and solute-solvent interactions may enhance the migration of molecules within

the matrix by increasing the permeability and reducing specific quinoline-sorbent

interactions, thereby reducing sorption nonequilibrium. However, the fraction of

instantaneous sites may decrease.

Addition of methanol (30%) reduced quinoline sorption (Figure 2-12).

Quinoline solubility increases with increasing volume fraction methanol








corresponding to a decrease in sorption upon solvent addition (Fu and Luthy,

1986a). Transport parameters for two Eustis soil columns are presented in

Table 2-3. Cosolvent effects on solubility and sorption of quinoline is

confounded by specific solvent-sorbent and solvent-solute interactions. The self

sharpening front is indicative of isotherm nonlinearity. Sorption of quinoline in

up to 40% methanol was nonlinear (Zachara et al., 1988). However, sorption

isotherms of pesticides have shown increased linearity upon addition of

cosolvents (Nkedi-Kizza et al., 1985).

Direct observation of the organic matter surfaces was attempted by

taking a scanning electron micrograph (SEM) of an organic soil (Figure 2-14).

The soil was dried at 60C and gold coated to prepare the sample. The soil

was not fixed with glutaraldehyde or dehydrated with solvents to minimize

structural changes due to fixative agents. The SEM shows the heterogeneity

association with the surface of organic matter (Figure 2-14a). However, the

interior of the organic matrix which is the major sink for HOCs is not visualized

using this technique. We do, however, come to appreciate the complexity of

the organic surface and the relative scale at which we need to view the organic

matrix to observe the location of the contaminants within this region. For

example, the magnification of this SEM is 6000 X. The scale provides reference

to the size of quinoline. The quinoline molecule conceptualized in Figure 2-10 is

1 nm in length, suggesting that about 3000 quinoline molecules

would fit along the scale key. One begins to envision molecules diffusing

through this heterogeneous media and the concept of rate-limited sorption.





































..-. ,


./
,,. ,. b.. j '


Figure 2-14.


Scanning
6000x (a)


electron micrograph of an organic soil at
and lOOOx (b).






r


't1t









The SEM photograph also shows fungal spores that have been preserved

within this organic soil. Further investigation of the organic matter surface

revealed fungal mats forming on the organic matter surface (Figure 2-14b). The

prolific growth of fungal spores and hyphal mass depicts the colonization of the

soil surface by microbial biomass and the possibility of altering contaminant

sorption and transport.


Summary

Quinoline is sorbed predominately on cation exchange sites on clay and

organic matter. Sorption is therefore dependent on quinoline speciation as

influenced by pH. Kinetics of ion exchange are rapid; therefore, quinoline

sorption is controlled by accessibility of sites, most likely through surface

complexation or inaccessibility due to steric hindrances. Quinoline sorption

potentially occurs via a three-step process -- an initial rapid phase sorbing onto

instantaneously accessible sites, followed by a reorientation of the molecule on

the surface, and subsequent redistribution within the organic matrix and

interlamellar regions of phyllosilicate minerals. Therefore, conceptually the

bicontinuum model is not adequate to describe quinoline sorption.

Quinoline sorption within phyllosilicate minerals and organic matter is

rate-limited. Sorption of quinoline on the outer edges of smectite clay minerals

may impede access of other quinoline molecules. A buildup of molecules at

clay interlayers may occur as desorption and migration into interlamellar regions

is limited. Therefore, access to the interlayer position may be blocked if









quinoline migration and redistribution is rate-limited. In addition, specific

quinoline-sorbent interactions (reorientation and charge delocalization) limit

desorption from the surface. On the other hand, if sorption occurs onto a

preconditioned quinoline soil containing phyllosilicate minerals access to

interlayer regions may be enhanced due to compensation of charge by the

preexisting quinoline. Sorption within organic matter is likely limited by specific

electrostatic interactions which cause reconfiguration of the organic-type

polymers. Both sorbents restrict migration into interior regions causing rate-

limited sorption.

The bioavailability of quinoline sorbed within either sorbent matrix is likely

to be limited. As indicated by repeated washing of the Norborne soil, 5 to 10 %,

of the solute remains sorbed. This fraction is therefore, rendered unavailable to

the microorganisms based on the location of the solute and the microorganism

(See Chapter 4 for further discussion). The distribution is microbial biomass in

the organic soil (Figure 2-14) suggested that microbial biomass may proliferate

and cover the soil surface.

The addition of microbial biomass to soils and aquifers may substantially

alter the nature of the sorbent surface (Figure 2-14). In the absence of

biodegradation, the impact of biomass on contaminant sorption and transport is

of great interest.













CHAPTER 3
ALTERATION OF SURFACES BY BACTERIAL BIOMASS


Introduction

Bioremediation practices attempt to increase microbial activity or populations

in order to degrade organic contaminants present in soils or aquifers. Indigenous

microbial activity and/or populations may be increased by providing nutrients

essential for bacterial growth, or axenic bacterial cultures known to degrade

specific compounds may be injected directly into contaminated sites. Growth or

addition of bacteria may drastically alter the chemical and physical characteristics

of solid surfaces (Fletcher, 1991). Therefore, the impact of bacterial biomass on

contaminant behavior in porous media near hazardous waste sites is of interest.

In addition to contaminant biodegradation, addition of bacteria to porous

media may result in: 1) bacterial growth or transport through the porous media

leading to pore clogging as a result of physical straining; 2) biosorption and

bacterial migration facilitating contaminant transport; and 3) bacterial sorption onto

soil surfaces altering the sorption capacity. Although bacterial migration through

sandy soils and aquifers is well documented, bioremediation attempts have failed,

among other reasons, due to the inability of injected bacteria to reach

contaminated sites (Gibson and Sayler, 1992). Physical, chemical, and microbial

factors controlling bacterial transport in porous media have recently been







76
summarized (Harvey, 1991, Lindqvist and Enfield 1992b, Tan et al., 1992).

Bacterial transport may be limited by physical constraints imposed by the porous

media, such as soil structure and pore size distribution (Lindqvist and Enfield,

1992b). Straining or filtration occurs in soils and aquifers when bacteria are too

large to pass through soil pores; this results in pore clogging, which restricts

further penetration of bacteria (Herzig et al., 1970; Harvey, 1991). Once bacteria

become clogged in the soil pores, water flow is also restricted, and the path of

water flow can be altered (Vandevivere and Baveye, 1992).

Chemical constraints, such as adsorption of bacteria, may also limit bacterial

migration through soils and aquifers (Harvey et al., 1989; Harvey, 1991, Bales et

al., 1991; Tan et al., 1992). Bacteria that are hydrophobic and are minimally

charged have the greatest potential to sorb onto surfaces; however, many other

factors may influence bacterial attachment (van Loosdrecht et al., 1987). Because

of bacterial adsorption by soils (Daniels, 1972) and clay minerals (Stotzky and

Rem, 1966), the contaminant sorption capacity of the soil may be altered. Bacteria

grow after they attach to surfaces if essential carbon and energy sources are

available. Growth and development of bacterial colonies generally coincide with

the production of extracellular polysaccharides and promote the formation of

bacterial biofilms (van Loosdrecht et al., 1990; Fletcher, 1991). Bacterial biomass,

therefore, contains live and dead cells and cell exudates extracellularr polymers).

Under nutrient- and substrate-rich conditions, as may be the case near wastes

sites, biofilm formation may create diffusional barriers leading to nonequilibrium







77
sorption of contaminants. This is generally the case for wastewater treatment by

filtration through activated carbon beds (Speitel et al., 1989; Rittman and McCarty,

1978). Bacterial biomass may physically alter the accessibility of sorption sites,

thereby reducing contaminant sorption. To further complicate the problem,

bacterial biomass may act as an additional sorbent, thereby increasing

contaminant sorption.

Sorption by various microorganisms in aquatic systems has been shown for

hydrophobic organic chemicals (HOCs) (Baughman and Paris, 1981; Tsezos and

Bell, 1989), metals (Scott and Palmer, 1990), and organic amines (Crist et al.,

1992). A consensus on biosorption mechanisms has not been reached, and

usually no distinction is made between sorption onto extracellular regions and

absorption into the cells. Properties such as aqueous solubility and log Kow (Kow

= octanol water partition coefficient) for the contaminant (Selvakumur and Hsieh,

1988) and bacterial lipid content (Bitton et al., 1988) have been correlated to

biosorption of HOCs. Biosorption of trace metals has been shown to occur via

adsorption onto extracellular bacterial capsules with minimal intracellular uptake

(Scott and Palmer, 1992). Sorption of organic amines by algae has also been

described by mechanisms including ion exchange and hydrophobic bonding (Crist

et al., 1992). Occurrence of biosorption and bacterial migration, regardless of the

underlying mechanisms, suggests the potential for biofacilitated transport of

contaminants. Lindqvist and Enfield (1992a) demonstrated bacterial-facilitated

transport of two HOCs (dichloro-diphenyl-trichloroethane and hexachlorobenzene)







78
in sand columns. Biosorption technology has been commercialized to mobilize

metals in the mining industry (Ehrlich and Brierley, 1990). However, biofacilitated

transport of NHCs bases has yet to be demonstrated.


Research Question and Tasks

At the field scale, the question of interest is: what are the consequences

of bioenhancement or bioaugmentation practices in attempts to remediate

contaminated sites? Specifically, do bacteria alter the sorption and transport of

NHCs? In this chapter I examine the impact of bacterial biomass on the

sorption and transport of three solutes (naphthalene, 45Ca, and quinoline) in a

subsurface soil. These compounds were selected because of their known

specific interactions in soil: 1) naphthalene was selected to probe hydrophobic

interactions with the nonpolar organic phase; 2) 45Ca was selected to probe

electrostatic interactions with the cation exchange sites; and 3) quinoline, a N-

heterocyclic organic base, was selected because it can exist as a neutral

organic compound interacting with the organic phase or as a quinolinium ion

interacting with cation exchange sites. Miscible displacement techniques were

used to measure sorption and transport of the above compounds during

steady, saturated water flow conditions through homogeneously-packed, sterile

or bacterial-inoculated, soil columns. A fine-textured silt loam soil (Norborne;

fine-loamy, mixed, mesic Typic Argiudoll) was chosen for these experiments

because of the extensive characterization of quinoline sorption by this soil

(Zachara et al., 1988; 1990). Sorption of naphthalene by the organic fraction of









soil is well documented (Chiou et al., 1983; Karickhoff et al., 1979). Pre-

inoculation of the Norborne soil with bacteria (108 cfu/g) simulates

contaminated subsurface soils and aquifers where bacterial populations may be

high.

Materials and Methods

Sorbents

The Norborne soil was used for these studies (Table 2-1). Glassbeads

(average diameter 150 /m; Alltech Associates) and inert quartz sand (< 2 mm)

were used as inert solid support material. All sorbents were sterilized using

steam autoclaving as referenced in Chapter 2.


Sorbates

Pentafluorobenzoic acid (PFBA; 150 Ag/mL) was used as conservative,

nonsorbing tracer to assess the hydrodynamic dispersion and extent of physical

nonequilibrium conditions prevailing during transport through the soil columns

(Brusseau et al., 1989). Quinoline and naphthalene concentrations in the

influent solutions for the column studies ranged from 4 to 10 pg/mL. Isotopic

exchange of 40Ca and 45Ca (6,000 dpm/mL) was also investigated. Aqueous

solutions of the chemicals were prepared in filter-sterilized (0.2 jim) 0.005 or

0.05 M CaCI2. Sorbates were monitored by HPLC-UV for quinoline and

naphthalene, and by radio-assay techniques for 45Ca (See Chapter 2).









Bacterial Strains and Culture Conditions

A strain of Pseudomonas sp. 3N3A capable of degrading quinoline and a

mutant strain (B53) derived from the 3N3A strain [obtained from Brockman et

al. (1989)]. Incorporation of two proteins for bacterial enumeration rendered the

organism incapable of degrading quinoline (McBride et al., 1992). The B53

isolate was used to determine the impact of biomass on sorption and transport

of quinoline where degradation was not a factor.

The B53 and 3N3A strains were grown for 17.5 hours on tryptic soy

broth (3 g/L) at 28 C on a rotary shaker (100 rpm). Bacterial cells were

harvested by centrifugation, washed two times and diluted to the desired

bacterial density with the appropriate background matrix solution (0.005 or 0.05

M CaCl2). Bacteria were allowed to equilibrate overnight in the desired matrix

prior to each experiment. Plate counts were done using tryptic soy agar (TSA)

and 4 day incubation periods at 28C. Plate counts were verified by visual

inspection of bacterial suspensions using a hemacytometer. A phase-contrast

microscope (Wild Neenbrugg) was used for counting the bacteria in the

hemacytometer.


Bacterial Inoculation

A 0.5 mL-aliquot of the appropriate bacterial suspension was placed in

an aspirator. The sterile soil (50 g) was thinly spread on aluminum foil and the

bacterial suspension was sprayed on the soil in a fine mist to uniformly

distribute the bacteria. The soil sample was mixed thoroughly to ensure








81
homogeneous distribution of the bacteria. The aspirator was rinsed with a 0.5-

mL aliquot of filtered (0.2 j/um) CaCI2, and the rinsate was sprayed on the soil.

The initial inoculation rate was 106 cfu/g soil unless otherwise indicated. The

soil was mixed again, and a subsample was taken for water content

determination. The soil-water content following bacterial addition ranged from 5

to 10%.


Column Studies

Miscible displacement techniques were used to characterize the transport

of PFBA, 45Ca, quinoline, and naphthalene. The sterile or bacterial inoculated

soil was packed into a Kontes glass column (5 cm long, 2.5 cm i.d.) as

described in Chapter 2. After packing, approximately 150 pore volumes of

0.005 or 0.05 M CaCI2 solution were pumped through the column to achieve

saturated, steady water flow conditions and uniform bacterial populations (108

cfu/g). Soil columns varied in bacterial density and type (sterile, or inoculated

with either B53 or 3N3A isolate) and in ionic strength (0.005 or 0.05 M) of the

displacing solution. Solute concentrations were monitored continuously or by

collecting column effluent fractions. Dissolved oxygen (DO) in the soil column

effluent was measured at different pore-velocities from 0.6 to 90 cm/hr. A

vessel was purged with N2, effluent from the column introduced, and DO

measured with a dissolved oxygen electrode (Yellow Springs Instruments 5750).

Sorption of quinoline by live cells of the B53 and 3N3A isolates was

measured at a bacterial density of 108 cfu/mL. The initial quinoline









concentrations were 1, 4, and 8 /g/mL. Bacterial suspensions were

equilibrated with quinoline at 5 C for 1 hr to minimize intracellular uptake and

possible biodegradation by the 3N3A isolate. Biosorption of 45Ca was

measured at room temperature (22-25C). Samples were centrifuged for 20

min at 1,250 g at 5C to separate the cells from the aqueous phase. Quinoline

solution concentrations were measured by HPLC to monitor for possible

biodegradation products. Biosorption was calculated as the difference in the

initial and final solution concentrations. Miscible displacement techniques

described earlier were employed to measure biosorption by bacteria "attached"

to glass microbeads. Glass microbeads (average diameter 150 ,m; Alltech

Associates) were inoculated with 107 cfu/g, packed into a column, and

saturated with 0.05 M CaCI2 for 48 hours at a pore-water velocity of 13.5 cm/hr.

BTCs for quinoline, 45Ca, and naphthalene were measured simultaneously by

injecting a mixture of these three solutes on the column; this was done so that

BTCs for all three solutes were obtained under identical hydrodynamic and

microbial conditions. Effluent fractions were collected and monitored by the

techniques stated above.


Surface Accessibility

A comparison of the estimated values of the bicontinuum sorption model

parameters (Chapter 1 and 2) for the sterile and inoculated soil columns were

used for a quantitative assessment of: 1) the hydrodynamic impacts, based on

P; 2) the changes in equilibrium sorption capacity, based on K ; and 3) the

accessibility of sorption regions, based on F and k2.









Results

The behavior of PFBA in sterile and bacterial-inoculated columns is

represented by the PFBA breakthrough curve (BTC) in Figure 3-1. BTCs for

quinoline (0.005 M CaCI2) in a sterile and inoculated (B53 and 3N3A isolates)

columns are also shown in Figure 3-1. BTCs for 45Ca and naphthalene (0.05 M

CaCl2) in sterile and inoculated B53 columns are shown in Figure 3-2 and 3-3,

respectively. The PFBA BTCs for all soil columns were symmetrical and sigmoidal

in shape, which suggests the absence of physical nonequilibrium (Brusseau and

Rao, 1989b), and P > 98 is indicative of minimal hydrodynamic dispersion.

Quinoline and naphthalene sorption was reduced in inoculated soil columns

(Figures 3-1 and 3-3). 45Ca sorption (Figure 3-2) was not reduced in the B53

inoculated soil columns. The shift in the 45Ca BTC in the two bacterial-inoculated

soil columns (BQ11 and BQ112) and the sterile column (B) resulted from

differences in the bulk densities (p) and volumetric water contents (0) of the

various columns (Table 3-1). Therefore, direct comparison of R for different

columns is misleading. The impact of bacteria on sorption and transport of

quinoline, 45Ca, and naphthalene was assessed by comparing the Kf values in

sterile and inoculated columns. The Kf values verified that sorption of quinoline

and naphthalene was reduced in inoculated columns, whereas 45Ca sorption was

not significantly different.

The following results are from a series of experiments that were conducted

to deduce the causes of reduced quinoline and naphthalene sorption. Experiments



















1



0.8


0
0.6

L)
oO4
0
0.4

0

1 0.2
0)
cc


E
[]
[]


S
* 0


- m


*-





*


F S


Quinoline:
* Sterile (B)

* 3N3A (BQ6)

E B53 (BQ9)


* PFBA


U
-m


-D


Pore Volumes (p)


Figure 3-1.


Measured BTCs for PFBA (0) in a sterile column and
for Quinoline in a sterile (0), 3N3A inoculated (*), and
B53 inoculated (D) soil column. Column designations
are given in parenthesis corresponding to Table 3-1.


*


E] El





























c. O
6b

*
0 *
*0 0
*oo
0 +
OJ 4!
$ O 0
. .. ,* ^ oo .


5 10 1
Pore Volumes (p)


Figure 3-2.


Measured BTCs for 45Ca in sterile (*) and B53
inoculated (0 and *) soil columns. Column
designations are given in parenthesis corresponding to
Table 3-1.


0.8


0.6


0.4


0.2


* Sterile (B)
o B53(BQ11)
* B53(BQ112)


0
0







86









1
0 0 0
0
0 0
TPo


0
0
0.6 o
00
a)
S0.4 o .
0

0.2 Sterile (B)
0.2
"0 0 B53(BQ11)
0
06 d j I I -----I

0 5 10 15
Pore Volumes (p)



Figure 3-3. Measured BTCs for Naphthalene in a sterile (0) and a
B53 inoculated (o) soil column. Column designations
are given in parenthesis corresponding to Table 3-1.









Table 3-1. Column parameters and Kf values for quinoline, naphthalene, and
45Ca in sterile and inoculated Norborne soil columns.

CaCI2 p 6 Kf

Column ID mol/L pH g/cm3 cm3/cm3 Quinoline Naphthalene 45Ca

Sterile, BQ5 0.005 7.0 1.48 0.44 3.11 --- 10.0
Sterile, B 0.05 7.0 1.54 0.42 3.11 0.946 1.17
B53, BQ9 0.005 6.8 1.46 0.45 1.39 ..
B53, BQ11 0.05 6.6 1.44 0.41 1.05 0.555 1.05
B53, BQ112 0.05 6.7 1.44 0.46 -- 1.06
3N3A, BQ6 0.005 6.9 1.39 0.46 2.42 ..






focused on distinguishing between the processes that may influence

contaminant sorption and transport including altered water flow resulting from

pore blockage, biofacilitated contaminant transport, and/or altered sorption

capacity of soil.


Pore Blockage

Pore blockage or straining of bacteria was investigated by measuring

BTCs for a nonadsorbed tracer (PFBA) once a day for 7 days following

bacterial inoculation. Variations in pore volume determinations or asymmetrical

BTCs would indicate changes in physical characteristics of the column. In all

cases, the BTCs measured for PFBA were symmetrical (indicative of no

changes in hydrodynamic characteristics) and the pore volume determined by




Full Text
74
quinoline migration and redistribution is rate-limited. In addition, specific
quinoline-sorbent interactions (reorientation and charge delocalization) limit
desorption from the surface. On the other hand, if sorption occurs onto a
preconditioned quinoline soil containing phyllosilicate minerals access to
interlayer regions may be enhanced due to compensation of charge by the
preexisting quinoline. Sorption within organic matter is likely limited by specific
electrostatic interactions which cause reconfiguration of the organic-type
polymers. Both sorbents restrict migration into interior regions causing rate-
limited sorption.
The bioavailability of quinoline sorbed within either sorbent matrix is likely
to be limited. As indicated by repeated washing of the Norborne soil, 5 to 10 %,
of the solute remains sorbed. This fraction is therefore, rendered unavailable to
the microorganisms based on the location of the solute and the microorganism
(See Chapter 4 for further discussion). The distribution is microbial biomass in
the organic soil (Figure 2-14) suggested that microbial biomass may proliferate
and cover the soil surface.
The addition of microbial biomass to soils and aquifers may substantially
alter the nature of the sorbent surface (Figure 2-14). In the absence of
biodegradation, the impact of biomass on contaminant sorption and transport is
of great interest.


97
regions in the soil. However, bicontinuum sorption model analysis of the BTC
data was attempted only for the naphthalene BTC data for the following
reasons: 1) unpublished data suggests that quinoline sorption dynamics are
more complicated than that conceptualized in the bicontinuum model; and 2)
cation exchange kinetics are rapid enough that the bicontinuum model is not
needed to describe 45Ca BTCs; an equilibrium sorption model provides an
adequate description (Brusseau et al., 1991).
The bicontinuum sorption model was used to fit the naphthalene BTC
data and to evaluate the alterations in accessibility to sorptive regions of soil.
About 60% (F= 0.63) of naphthalene sorption was surmised to have occurred
instantaneously in the sterile soil, while F decreased to 0.33 in the inoculated
column. About 50% reduction in the F value suggests that the accessibility of
sorption regions to naphthalene had been reduced due to the presence of
bacterial biomass. The k2 (1.66 hr'1) and Kp (0.946 mL/g) from the sterile
column are in agreement with the log-log-linear inverse relationship between log
k2 and log Kp values (log k2 = 0.301 0.668 log Kp) reported for sorption of
HOCs (Brusseau and Rao, 1989a). However, the k2 value estimated from the
naphthalene BTC measured in the inoculated soil column was about a third of
that for the sterile column (0.52 vs. 1.66 hr'1), which is indicative of further
constraints on naphthalene sorption. The analysis of model parameters
suggests the following: 1) an overall reduction in naphthalene sorption
(decrease in Kp); and 2) a decrease in accessibility of sorption regions
(decrease in both F and k2).


114
contaminant may be rendered unavailable to bacteria. Irreversible sorption
reduces the total amount of contaminant available for degradation. This
statement is based on the assumption that the contaminant must exist in
solution prior to intracellular uptake. If specific interactions between the sorbent
and the contaminant occur such as expected with quinoline (Chapter 2) and as
demonstrated for diquat (Weber and Coble, 1968) the total amount of
contaminant degraded will be limited by the fraction that is irreversibly sorbed.
Figure 4-6 depicts the irreversible sorption (k2 = 0) and biodegradation of a
contaminant (data used from naphthalene). The decrease in the plateau value
is indicative of sorption rendering contaminants unavailable for biodegradation.
These examples illustrate the importance of understanding the sorption
mechanism and how to interpret the results.
Guerin and Boyd (1992) stated that the influence of contaminant sorption
on biodegradation varies with the degradative microorganism in question, and
invoked organism-specific properties to explain their results. Figure 4-7 and 4-8
depict the sorption and biodegradation behavior of naphthalene in soil
suspensions by the NP-Alk and the 17484 isolates, respectively. They
concluded that the total amount and the rates of naphthalene degradation in
soil-suspensions by two bacterial isolates were determined by whether the
organisms had the ability to directly access sorbed-phase naphthalene. They
suggested that NP-Alk (Figure 4-7) was judged to be effective in degrading only
the solution-phase naphthalene subsequent to desorption. The 17484 isolate


135
the bacterial isolate during inoculation was < 0.005 jug/g. Quinoline
biodegradation was shown to occur at concentrations as low as 2 ¡jl g/L (Smith
et al., 1992). As a result, sorption likely depletes quinoline below levels required
to sustain biodegradation in the Norborne soil columns. However, nutrients and
other carbon sources were available in the soil solution while saturating the
column. Bacterial activity in these soil columns is likely maintained, requiring
only adaptation to the soil environmental conditions. The time for adaptation in
this case was less than the 16 hours given adequate nutrient and oxygen
contents.
Oxygen and nutrient contents. The DO was 0.5 mg/L at a velocity of
0.195 mL/min, and 1.91 mg/L at a velocity of 0.98 mL/min. The rate of oxygen
consumption decreased with an increase in flow rate corresponding to the
decreased residence time which limited oxygen consumption. At these oxygen
concentrations, oxygen did not appear to be limiting quinoline degradation.
However, quinoline degradation was suggested to be extremely rapid (McBride
et al., 1992; Smith et al., 1992). Soil columns are conceptualized as a unit
volume wherein quinoline sorption and biodegradation occurs. The outcome is
only measured in the column effluent and does not present any information
about the profile of oxygen or quinoline within the column. Because of the
rapid biodegradation kinetics, quinoline may be degraded within the first 1 cm
of the column where oxygen is plentiful. As the oxygen is limiting and the
quinoline concentration decreases the biodegradation rates may decrease.


I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a dissertation for the degree of Doctor of Philosophy.
R. Dean Rhue
Associate Professor of Soil and Water
Science
This dissertation was submitted to the Graduate Faculty of the College of
Agriculture and to the Graduate School and was accepted as partial fulfillment of
the requirements for the degree of Doctor of Philosophy.
August, 1993
Dean, Coitege of Agriculture
Dean, Graduate School


153
maximum of about 3000 minutes. Completely mixed reactors were verified with
tracers (nonsorptive, nondegrading). The CSFTR supported growth of
individual microbial colonies which are the predominant form of bacterial
distribution in soil columns.
The use of a CSFTR was previously demonstrated by DiGrazia et al.
(1991). Our system varied in several ways due to requirements of the
experiment. This system employed a 0.2 /m filter in attempt to contain the
bacterial biomass and sorbent particles within the reactor. The CSFTR used by
DiGrazia et al. (1991) utilized soil particles that were sieved to a fraction
between 175 to 1000 ¡im and filters that had a pore size ranging from 0.4 to 4
m. This minimized soil loss, however, bacteria were not restricted from leaving
the system. As a result they reintroduced the column effluent into the CSFTR
once a day. Bacteria were exiting this CSFTR at about 105 cfu/mL despite the
fact that 2 0.2 /im filters were placed at the reactor outlet. Flowever, steady
state conditions were achieved with respect to bacterial growth and loss and
quinoline biodegradation.
The alteration of bacterial activity was observed upon the introduction of
clay particles into the CSFTR. The impact of sorption on biodegradation results
in decreased bacterial activity as a result in decreased uptake (blockage of the
cell membrane) of the primary metabolite 2-hydroxyquinoline.


123
Sorption of quinoline onto a smectite clay mineral is conceptualized to
illustrate the bioavailability of quinoline to the 3N3A isolate (Figure 4-9).
Consider that quinoline sorption occurs onto interlamellar regions of clay
minerals. The internal dimensions are 1.68 nm, whereas the bacterial isolate is
approximately 0.5 by 3 /nm. Due to size constraints, the quinoline molecule
must desorb and diffuse into the bulk solution prior to uptake and
biodegradation. If sorption is irreversible, quinoline may be unavailable for
intracellular biodegradation by the 3N3A isolate. It may be hypothesized that
degradation of sorbed phase molecules (surface scavenging may occur,
however, this behavior is unlikely for quinoline for two reasons: 1) bacteria are
too large to enter the sorbent matrix where the majority of quinoline resides;
and 2) formation of quinoline surface complexes on the sorbent matrix likely
renders quinoline unavailable for biodegradation.
In pure cultures, induction of the 3N3A isolate on 2-HQ resulted in rapid
utilization of quinoline, indicating that the initial oxygenase reactions are
coordinately regulated (Brockman et al., 1990). Extracellular enzymes (3N3A
filtrate) and disrupted cells were not able to degrade quinoline. Therefore,
quinoline enzymes cannot be induced without a quinoline transport or
recognition function. Addition of surfactants (membrane modifier) enabled
mutant isolates (no quinoline degradation) to subsequently degrade quinoline
by increasing the membrane permeability. Brockman et al. (1990) suggested
that initiation of biodegradation occurs as the result of a periplasmic binding


124
protein, or a cytoplasmic membrane transport protein that interacts specifically
with quinoline. Alternately, a positively controlled regulatory protein that
interacts with quinoline promotes induction.
Understanding factors that influence bacterial physiology is essential for
predicting the potential for biodegradation. The bacterial isolate, 3N3A, is a
strict aerobe capable of utilizing quinoline as a sole source of nitrogen, carbon,
and energy (Brockman et al., 1989). In soils, sediments, and aquifer materials,
microsites or complete regions may be devoid of oxygen. Near-field regions of
contaminated waste disposal sites may be depleted of oxygen as a result of
consumption by aerobic bacteria upon biodegradation, and over time, near-field
regions may support only anaerobic microbial communities (MacQuarrie and
Sudicky, 1990). High contaminant concentrations may also limit microbial
degradation due to toxic or inhibition (Truex et al., 1992).
Localized areas supporting bacterial growth cause the development of
bacterial biofilms (i.e., multilayer accumulation of bacterial biomass in response
to high nutrient and substrate concentrations). Within these biofilms, microbial
populations (species and numbers) may change in response to variations in
oxygen and nutrient contents as the soil surface is approached. For example,
biodegradation rates of quinoline per unit biomass of the 3N3A isolate may be
reduced if biofilms, thus, anaerobic regions, are formed. An appropriate
analogy may be the simple growth of a bacterial colony on an agar plate.
Bacteria located around the perimeter of the colony are actively growing


151
Near waste disposal sites, high microbial populations and colonization of
surfaces is likely. Therefore, enhanced contaminant transport may occur either
due to biomass-induced speciation changes of sorbent surfaces, reduced
accessibility of the sorbent, or biofacilitated transport. Stimulation of bacterial
growth as a result of bioremediation practices may enhance contaminant
transport if conditions for biodegradation are not favorable.
Solute-Microorganism Interactions
Laboratory experiments were conducted to determine the limiting factors
of quinoline biodegradation in flow-through column studies. The influence of
pH, oxygen, ground water velocity and nutrients on biodegradation of quinoline
were evaluated in flow-through systems. A CSFTR was designed to evaluate
the rapid biodegradation kinetics of quinoline and 2-HQ given essential
nutrients.
Truex et al. (1992) suggested that starved (decreased physiological
activity) quinoline degraders required about 30 hours to initiate degradation after
being depleted of nutrients, carbon, and energy sources in batch systems. This
study suggested that less than 16 hours were required to initiate biodegradation
in soils that contained essential nutrients. In this case, the bacterial inoculum
was directly added to the soil, packed into the soil column, and water flow
Initiated. The presence of nutrients and carbon sources likely sustained the
bacterial activity and reduced the time required for induction. Conducting a flow
interruption and a longer residence time (20 versus 10 minutes) may have also


106
Organic
Matter
Clay
Mineral
Microorganisms Metabolism
I yTN 0 P'
Figure 4-1. Schematic of sorption and biodegradation in soil
aggregates (C and C = the solute concentration in
the pore water inside the aggregate and the bulk
solution, respectively) (adapted from Mihelcic and
Luthy, 1988c).


100
Surface Alteration
Assuming that quinoline and 45Ca access the same cation exchange
sites, sorption of 45Ca and quinoline should be reduced to the same extent if
bacterial microcolonies developed and access to exchange sites was
inaccessible. Quinoline and 45Ca sorption was not reduced in a similar manner,
suggesting that biomass did not substantially alter the cation exchange capacity
of the soil. Biomass impacts on sorption were solute specific, even when the
sorption sites for both quinoline and 45Ca are similar. Thus, the differential
response is attributed to biomass-induced changes in quinoline speciation; an
increase in pH at the sorbent-water interface would result in a larger proportion
of the neutral species, and a decrease in sorption. Stucki et al. (1992) suggest
ed that microbial biomass modifies the redox status of clay minerals resulting in
charge destabilization and subsequent collapse of clay layers. Alteration of soil
properties and the soil-solution interface by bacterial biomass may impact the
behavior of ionogenic and inorganic compounds. The combination of biomass-
induced changes in quinoline speciation and inaccessibility of sites likely
reduced quinoline sorption. Bacterial biomass may contribute to the measured
increase in naphthalene sorption by adding hydrophobic microbial biomass to
the soil. Bacterial populations in the soil columns were about 108 cfu/g soil.
Although plate counts possibly underestimated the total number of cells, it was
reasonable to believe that 108 cfu/g were supported in the soil columns. The
corresponding bacterial fQC was 8 10'5 and the soil had an foc of 0.0016. In


130
Solutions were pumped into the inlet port with Gilson (Model 302) pump at a
constant velocity. The outlet port consisted of a series of two 0.2 /xm titanium
filters (Mott Metallurgical) with a glass membrane filter (1 /xm) in between to
minimize soil and bacterial biomass loss. The effluent fractions (1 to 5 min)
were collected and analyzed by HPLC or radioassay techniques (Chapter 2).
Soil suspensions (-1/20; 2 ml_ of a 1:10 g/mL suspension) were added to the
reactor and the stainless steel endcap (wrapped with teflon tape) was threaded
into place. The reactor was saturated with 0.05 M CaCI2 in an upright position.
Experiments were conducted under steady water flow conditions at 0.5 mL/min.
Effluent pH was monitored periodically using an Ingold microelectrode.
Bacterial activity in the presence of surfaces was measured by poising
the 3N3A isolate at steady state with respect to quinoline and 2-HQ
degradation. After steady state was reached, 2 ml_ of the clay suspension was
introduced into the inlet port and the effluent was again analyzed for quinoline
and 2-HQ. Changes in the behavior of quinoline or 2-HQ were imposed by the
addition of the clay surfaces. Based on initial abiotic sorption studies, quinoline
sorption at this mass to volume ratio was not measurable (R 1) on the
Norborne soil.
The sorption, biodegradation, and transport of contaminants in the
CSFTR were modeled assuming the equilibrium sorption and first-order
biodegradation kinetics. The change in mass in the CSFTR is given as follows:


26
diffusional constraints within the matrix (IOMD) cause sorption nonequilibrium of
HOCs. Nonequilibrium may also result from IPD (intraparticle diffusion) inside
microporous particles which contain organic coatings. HOCs are not likely to
exhibit chemical nonequilibrium because sorption occurs via partitioning
(Karickhoff et al., 1979; Chiou et al., 1983). Sorption of inorganic cations has
been shown to be rapid onto cation exchange sites and limited only by diffusion
to/from the exchanger surface (Nkedi-Kizza et al., 1989). Brusseau et al.
(1991) suggested that compensation of charge (i.e, cation sorption) likely
occurs near surfaces of organic matter; therefore, diffusional constraints of
HOCs and cations differ because of the path length and sorbent matrix.
Specific interactions of NHCs with the sorbent as well as and mass transfer
constraints within organic matter or phyllosilicate minerals are likely to limit
sorption of NHCs. Sorption of the quinolinium ion (i.e., cationic form of NHC)
onto predominantly organic matter associated CEO sites was suggested to be
faster than sorption of the neutral species (i.e., similar to HOCs) into the organic
matrix (Brusseau et al., 1991).
Quinoline, is a contaminant found in energy-derived waste materials and
products. Therefore, it was selected as a probe to evaluate the bicontinuum
sorption model and to further characterize the sorption dynamics of NHCs. A
first-order model did not adequately describe the complex interaction of
quinoline sorption onto clay modified alumina where 90% of the sites were
suggested to be readily available (Figure 2-1; Szecsody and Streile, 1992).


64
Another possibility is that the 14C-quinoline approaches equilibrium more
rapidly than the 12C-quinoline. The sigmoidal shape of the BTC for 14C-
quinoline is indicative of equilibrium sorption and a linear isotherm is expected
from exchange of 12C- and 14C-quinoline. Quinoline sorption isotherms were
nonlinear 1 /n0.7 in batch systems upon exchange of quinoline for ^Ca. The
self-sharpening front for the 12C-quinoline BTC is indicative of nonlinear sorption
(Brusseau and Rao, 1989b). The sharp front may also indicate nonequilibrium
conditions suggesting access into the interlayer positions and replacement of
calcium is difficult. Initial access of quinoline into interlayer positions may
enhance subsequent access of interlayer regions due to charge compensation
and reorientation (Figure 2-1 Oc). To test this hypothesis, a BTC of 14C-
quinoline on the backside tail (5-10% residual quinoline) could be conducted. If
the sharp front occurred on the BTC then it would suggest that as the percent
of quinoline on the exchange complex increased access to other interlayer sites
would increase.
From these two cases, nonequilibrium conditions prevail upon
introduction of quinoline, suggesting that some sites are extremely constrained
by diffusional and chemical factors. A fraction of the sites are considered to be
unavailable and thus, bioavailability is likely to be limited.
In the pH 3 and pH 4.6 columns, the minimal drop in effluent
concentration during flow interruption (Fig. 2-6) suggested that quinoline
sorption is near equilibrium. However, the relative concentration only reaches


133
Table 4-1. Nutrient concentration (mg/L) extracted from the Norborne soil column.
Ion
Mg
K
P
Zn
Cu
Mn
Al
Fe
Na
B
Pb
Cone
1.9
0.5
0.4
0.02
0.01
0.08
0.3
0.04
0.8
0.3
0.07
indigenous environment. The soil effluent analysis suggested that nitrogen (not
shown) and Fe concentrations may be limiting. However, quinoline can be
utilized as sole source of nitrogen, and the soil likely contains sufficient amounts
of Fe if it is continually released from the soil matrix (Zachara et al., 1988).
Growth rates of the 3N3A isolate induced on soil column effluent were not
quantitatively measured; however, production of pink metabolites ("dead-end"
metabolites) and turbid cultures (107 cfu/mL) were produced after about 2-3
days from use of the soil column effluent (in 0.005 M CaCI2). Growth of the
3N3A isolate on 3 g/L tryptic soy broth generated 109 cfu/mL within 36 hours
suggesting that microbial populations, and ultimately biodegradation, may be
influenced by the nutrient status in the environment.
Consistent nutrient composition was necessary for comparison of
biodegradation experiments; therefore, use of extracted nutrient solutions is
recommended only if a single batch is utilized for all experiments. Bacterial
growth notably diminished over time on various soil nutrient extracts, and did
not produce turbid cultures or known quinoline metabolites. Therefore, the soil,
and the nutrient solution, were likely depleted in nutrients after repeated
washings. The nutrient solution used by Brockman et al. (1989) for inducing
the 3N3A isolate was used in all CSFTR experiments.


% C MINERALIZED
108
Figure 4-2. The impact of varying the sorption partition coefficient
on biodegradation (L/kg) in the presence of
aggregates with radii of 0.05 cm. (From Scow and
Hutson, 1992).


166
Scott, J.A., and S.J. Palmer. 1990. Sites of cadmium uptake in bacteria used for
biosorption. Appl. Microbiol. Biotechnol. 33:221-225.
Scow, K.M., and M. Alexander. 1992. Effects of diffusion on the kinetics of
biodegradation: experimental results with synthetic aggregates. Soil Sci. Soc.
Am. J. 56:128-134.
Scow, K.M., and J. Hutson. 1992. Effect of diffusion and sorption on the kinetics of
biodegradation: Theoretical considerations. Soil Sci. Soc. Am. J. 56:119-127.
Scow, K.M., S. Simkins and M. Alexander. 1986. Kinetics of mineralization of organic
compounds at low concentrations in soil. Appl. Environ. Microbiol. 51:1028-
1035.
Selvakumar, A., and H.-N. Hsieh. 1988. Correlation of compound properties with
biosorption of organic compounds. J. Environ. Sci. Health. A23:543-557.
Sherbet, G.V. 1978. Cell electrophoresis, p.36-145. In The biophysical characterization
of the cell surface. Academic Press, New York.
Simkins, S., R. Mukherjee, and M. Alexander. 1986. Two approaches to modeling
kinetics of biodegradation by growing cells and application of a two-
compartment model for mineralization kinetics in sewage. Appl. Environ.
Microbiol. 51:1153-1160.
Smith, M.S., G.W. Thomas, R.E. White, and D. Ritonga. 1985. Transport of Escherichia
coli through intact and disturbed soil columns. J. Environ. Qual. 14:87-91.
Smith, S.C., C.C. Ainsworth, S. Trana, and R.J. Hicks. 1992. The effect of sorption on
the biodegradation of quinoline. Soil Sci. Soc. Am. J. 56:737-746.
Speitel Jr., G. E., M.H. Turakhia, and Chih-Jen Lu. 1989. Initiation of micropollutant
biodegradation in virgin GAC columns. J. Am. Water Works Assoc. 81:168-176.
Steen, W.C., D.F. Paris, and G.L. Baughman. 1980 Effects if sediment sorption on
microbial degradation of toxic substances, p. 477-482. In R.A. Baker (ed.),
Contaminants and sediments, Vol. 1, Fate and transport, case studies,
modeling, toxicity. Ann Arbor Science Publishers, Ann Arbor, Ml.
Steinberg, S.M., J.J.Pignatello, and B.L. Sawhney. 1987. Persistence of 1,2-
dibromomethane in soils: entrapment in intraparticle micropores. Environ. Sci.
Technol. 21:1201-1208.


LIST OF TABLES
Table page
2-1. Soil properties before and after steam autoclaving 36
2-2. Column parameters for sterile soil columns 48
2-3. Summary of estimated transport parameters for quinoline 57
3-1. Column parameters and Kj values for quinoline, naphthalene, and
45Ca in sterile and inoculated Norborne soil columns 87
4-1. Nutrient concentration (mg/L) extracted from the Norborne soil
column 133
vii


77
sorption of contaminants. This is generally the case for wastewater treatment by
filtration through activated carbon beds (Speitel et al., 1989; Rittman and McCarty,
1978). Bacterial biomass may physically alter the accessibility of sorption sites,
thereby reducing contaminant sorption. To further complicate the problem,
bacterial biomass may act as an additional sorbent, thereby increasing
contaminant sorption.
Sorption by various microorganisms in aquatic systems has been shown for
hydrophobic organic chemicals (HOCs) (Baughman and Paris, 1981; Tsezos and
Bell, 1989), metals (Scott and Palmer, 1990), and organic amines (Crist et al.,
1992). A consensus on biosorption mechanisms has not been reached, and
usually no distinction is made between sorption onto extracellular regions and
absorption into the cells. Properties such as aqueous solubility and log Kow (Kow
= octanol water partition coefficient) for the contaminant (Selvakumur and Hsieh,
1988) and bacterial lipid content (Bitton et al., 1988) have been correlated to
biosorption of HOCs. Biosorption of trace metals has been shown to occur via
adsorption onto extracellular bacterial capsules with minimal intracellular uptake
(Scott and Palmer, 1992). Sorption of organic amines by algae has also been
described by mechanisms including ion exchange and hydrophobic bonding (Crist
et al., 1992). Occurrence of biosorption and bacterial migration, regardless of the
underlying mechanisms, suggests the potential for biofacilitated transport of
contaminants. Lindqvist and Enfield (1992a) demonstrated bacterial-facilitated
transport of two HOCs (dichloro-diphenyl-trichloroethane and hexachlorobenzene)


34
quinoline solubility. Quinoline isotherms at high concentrations (25 to 1000
mg/L) were suggested to be linear in water-methanol systems up to fc = 0.5
(Fu and Luthy, 1986b). Sorption at low concentrations ( 0.15 ng/mL) was
suggested to be nonlinear in aqueous systems (1 /n = 0.75) and in
methanol/water solutions (20 vol % methanol; 1/n = 0.67) (Zachara et al.,
1988). Isotherm linearity has been shown to increase upon addition of
cosolvents for partitioning of solutes into an organic matrix; however, if ion
exchange predominates specific interactions with cation exchange sites may be
altered. For organic bases and acids, addition of solvents increases the fraction
of neutral species (Perrin et al., 1981; Lee, 1993). In the presence of
cosolvents, changes in the pKa values for organic bases are minimal (Perrin et
al., 1981). However, substantial increases in pKa values for organic acids have
been shown due to solute-solvent interactions resulting in decreased sorption of
phenolic compounds and increased sorption of carboxylic acids (fc > 0.2) (Lee,
1993).
Considering that the quinolinium ion sorption occurs predominately onto
cation exchange sites at low surface coverages, one could envision rate-limited
desorption of quinoline out of interlamellar regions of clay minerals and
aggregates or intra-organic matter regions. Such mass transfer constraints
delay the release of contaminants leading to persistence, inadequate
remediation, and limited bioavailability.


Relative Concentration (C/Q,)
0.8
0.6 -
0.4
0.2
0 4



*

* a *
* ~
*
*


*

-B




*
*
Quinoline:
Sterile (B)
* 3N3A (BQ6)
B53 (BQ9)
h PFBA
*
5 10
Pore Volumes (p)
Figure 3-1. Measured BTCs for PFBA (H) in a sterile column and
for Quinoline in a sterile (), 3N3A inoculated (*), and
B53 inoculated () soil column. Column designations
are given in parenthesis corresponding to Table 3-1.


164
Miller, R.M., and R. Bartha. 1989. Evidence from liposome encapsulation for
transport-limited microbial metabolism of solid alkanes. Appl. Environ. Microbiol.
55:269-274.
Molz, F.J., M.A. Widdowson, LD. Benefield. 1986. Simulation of microbial growth
dynamics coupled to nutrient and oxygen transport in porous media. Water
Resour. Res. 22:1207-1216.
Myrold, D.D, and J.M. Tiedje. 1985. Diffusional constraints on denitrification in soil. Soil
Sci. Soc. Am. J. 49:651-657.
Nkedi-Kizza, P., M.L. Brusseau, P.S.C. Rao, and A.G. Hornsby. 1989. Nonequilibrium
sorption during displacement of hydrophobic organic chemicals and 4^Ca
through soil columns with aqueous and mixed solvents. Environ. Sci. Technol.
23:814-820.
Nkedi-Kizza, P., P.S.C. Rao, and A.G. Hornsby. 1985. Influence of organic cosolvents
on sorption of hydrophobic organic chemicals by soils. Environ. Sci. Technol.
19:975-979.
Nkedi-Kizza, P., P.S.C. Rao, and A.G. Hornsby. 1987. Influence of organic cosolvents
on leaching of hydrophobic organic chemicals through soils. Environ. Sci.
Technol. 21:1107-1111.
Nkedi-Kizza, P., P.S.C. Rao, R.E. Jessup, and J.M. Davidson. 1982. Ion exchange and
diffusive mass transer during miscible displacement through an aggregated
oxisol. Soil Sci. Soc. Am. J. 46:471-476.
O'Connor, G.A., R.S. Bowman, M.A. Elrashidi, and R. Keren. 1983. Solute retention
and mobility in New Mexico soils 1. Characterization of solute retention
reactions. Agricultural Exp. Station Bulletin 701, Las Cruces, New Mexico.
Ogram, A.V., R.E. Jessup, and P.S.C. Rao. 1985. Effects of sorption on biological
degradation rates of 2,4-dichlorophenoxyacetic acid in soils. Appl. Environ.
Microbiol. 49:582-587.
Okuda, I. 1993. Sorption and transport in heterogeneous porous media: Applications
of fractal and stochastic approaches. Ph.D. diss. Univ. of Florida, Gainesville,
FL.
O'Loughlin, E.J., S.J. Trana, and G.K. Sims. 1991. Effects of adsorption on the
biodegradation of 2-methyl-pyridine. Agr. Abstr. p. 273. Denver, CO.


Relative Concentration (C/Cq)
92
1
0.8
0.6
0.4
0.2
0
*¡
4

o
o
o
o
*

o
*

44-
Glassbead Column
o
Naphthalene
45
Ca
D Quinoline
* PFBA
Pore Volumes (p)
Figure 3-4. Measured BTCsfor PFBA (*), 45Ca (), Quinoline (), and
Naphthalene (o) in a B53 inoculated soil column.


121
only will the bacterial activity potentially be altered but the sorptive capacity of
quinoline will also be Influenced (see Chapter 2). Bacterial activity In solution
and in the presence of surfaces will be addressed.
Quinoline Biodegradation Dynamics
A conceptualization of quinoline biodegradation Is presented in Figure 4-
9. Quinoline degradation by a P. cepacia (3N3A) Isolate occurs via membrane-
associated dehydrogenase that forms the primary metabolite 2-HQ (Truex et al.,
1992). The second step involves ring cleavage of 2-HQ by dioxygenation and
dehydrogenation of the benzene ring with the end product being C02. Smith et
al. (1992) reported rapid appearance of 2-HQ In solution suggesting that 2-HQ
may be released Into the solution-phase prior to Intracellular uptake. Release of
2-HQ was thought to compete with quinoline for sorption sites (McBride et al.,
1992;Smlth et al., 1992). However, data presented In Chapter 2 suggested that
2-HQ did not reduce quinoline sorption over a wide pH range (4 to 7) in batch
systems. Alternately, sorption of 2-HQ may have blocked quinoline sorption
sites thereby reducing quinoline sorption (McBride et al., 1992). Degradation of
quinoline via a membrane-mediated pathway facilitates rapid degradation
(seconds to minutes) and creates experimental difficulties when using column
techniques. Given such constraints, McBride et al. (1992) used 1-cm long glass
bead columns and clay-modlfled alumina columns with high pore-water
velocities to facilitate monitoring quinoline sorption and biodegradation.


139
biodegradation kinetics in bacterial suspensions (Figure 4-12). The data are
normalized to the initial quinoline input concentration. Immediately following the
addition of the 3N3A isolate to the CSFTR the quinoline solution was introduced
and the effluent sampled. The quinoline and 2-HQ detected in the CSFTR
effluent for the first 30 to 40 minutes were residual quinoline and lower
metabolites remaining from the nutrient/induction solution. Quinoline
biodegradation (quinoline to 2-HQ) attained steady state about 800 minutes
after quinoline introduction. Biodegradation of 2-HQ (quinoline to 2-HQ to other
metabolites) reached steady state in approximately the same time frame. The
approach to steady state likely corresponds to the adaptation time and build up
of degradative enzymes required for the 3N3A isolate in the CSFTR. The
quinoline and 2-HQ solution concentrations were decreased to < 5 % of the
initial feed concentration. Agitation decreases bacterial activity due to
flocculation and damage to the cell as the stirring rate increases (Stratford and
Wilson, 1990). However, cell disruption was shown to inactivate quinoline
degradation (Brockman et al., 1990). Plating the internal cell suspension of
showed 106 cfu/mL in the quinoline CSFTR. Agitation in a CSFTR may release
enzymes capable of degrading; therefore, the cell suspension was filtered and
equilibrated with quinoline and mineral salts solution. No metabolites were
observed suggesting that quinoline degradation remains a membrane
associated degradation process. Similarly, free enzymes (filtrates) from batch
systems were not able to degrade quinoline (Brockman et al., 1990). This


95
Evidence for alteration of the soil surface by bacterial biomass was
suggested in an inert quartz sand (<2 mm) column. The effluent pH from a
B53-inoculated quartz sand column was 4.65 upon introduction of PFBA (pKa =
1.59) while the pH of PFBA passing through the sterile quartz sand column was
pH 3.2. The quartz sand has no appreciable buffer capacity for maintaining the
pH of the acidic PFBA solution. Therefore, the pH increase in the column
inoculated with bacteria suggests that the bacterial biomass altered the soil
surface environment (e.g., bacteria have an inherent buffer capacity). Changes
in bulk solution pH were not observed for the experiments with the Norborne
soil column because of the larger buffer capacity of this soil. This does not,
however, preclude the possibility that alteration of pH had occurred within the
interfacial regions for the Norborne soil. Since it is difficult to measure any
changes in interfacial pH directly, we can only infer here the trends based on
observed effects on quinoline sorption by the Norborne soil.
Approximately 50% of quinoline sorption occurred within the interlayer
positions of phyllosilicate minerals. Microorganisms are unable to access
interlamellar regions of clay minerals due to size constraints. As a result, only
50% of the sorptive region is directly in contact with bacterial biomass.
Extracellular polymers may be released and migrate within interlamellar clay
regions. However, the influence of bacterial biomass is likely indirect.
Processes such as respiration consume oxygen and release of C02 likely
decreasing pH which would increase sorption. Simultaneously, a decrease in


104
or on the surface? and 4) Where are the microorganisms and does their activity
change while they are attached to surfaces or in the solution-phase? Some of
these questions have previously been addressed. However, after reviewing the
literature it becomes more obvious that this interdisciplinary problem needs
further resolution.
The speculation of the impact of sorption on biodegradation from
experimental data requires a full understanding of the aspects of contaminant
sorption and biodegradation processes. Consider the following two scenarios
to address the previous questions. In Case 1, hydrolysis of urea occurs via
extracellular enzymes. For discussion purposes, assume that urea is sorbed on
the sorbent surface and is hydrolyzed by sorbed extracellular enzymes. In this
case, the enzymes exist in collocation with the substrate, becoming more
bioavailable. However, if the enzymes are sorbed and fixed to the soil surface
they may be separated from the substrate and only have access to substrates
flowing by in the solution phase. Sorption may also "deactivate" the enzyme
due to structural rearrangement. Urea that is sorbed within the interior regions
of the sorbent matrix is likely unavailable due to restricted access of the
enzyme, and hydrolysis is thereby limited by urea diffusion out of the sorbent
matrix. As a result, urea hydrolysis may be the result of enzyme-urea
interactions occurring only in the solution phase.
Consider another example, Case 2, sorption of the contaminant occurs
within the organic matter matrix or phyllosilicate mineral and biodegradation


82
concentrations were 1, 4, and 8 /xg/mL Bacterial suspensions were
equilibrated with quinoline at 5 C for 1 hr to minimize intracellular uptake and
possible biodegradation by the 3N3A isolate. Biosorption of 45Ca was
measured at room temperature (22-25C). Samples were centrifuged for 20
min at 1,250 g at 5C to separate the cells from the aqueous phase. Quinoline
solution concentrations were measured by HPLC to monitor for possible
biodegradation products. Biosorption was calculated as the difference in the
initial and final solution concentrations. Miscible displacement techniques
described earlier were employed to measure biosorption by bacteria "attached"
to glass microbeads. Glass microbeads (average diameter 150 /im; Alltech
Associates) were inoculated with 107 cfu/g, packed into a column, and
saturated with 0.05 M CaCI2 for 48 hours at a pore-water velocity of 13.5 cm/hr.
BTCs for quinoline, 45Ca, and naphthalene were measured simultaneously by
injecting a mixture of these three solutes on the column; this was done so that
BTCs for all three solutes were obtained under identical hydrodynamic and
microbial conditions. Effluent fractions were collected and monitored by the
techniques stated above.
Surface Accessibility
A comparison of the estimated values of the bicontinuum sorption model
parameters (Chapter 1 and 2) for the sterile and inoculated soil columns were
used for a quantitative assessment of: 1) the hydrodynamic impacts, based on
P; 2) the changes in equilibrium sorption capacity, based on Kp; and 3) the
accessibility of sorption regions, based on F and k2.


4-4. Measured and simulated BTCs for 2,4,5-T developed with the two
region model for the two cases of no degradation (/la =0) and
degradation (/a >0). (From Gamerdinger et al., 1990) 111
4-5. Simulation of naphthalene degradation in soil suspensions. The
lines were generated using the bicontinuum model with first order
biodegradation kinetics, (model input parameters from Guerin and
Boyd, 1992) 113
4-6. Simulation using the bicontinuum model with first-order
biodegradation kinetics assuming irreversible sorption 115
4-7. Naphthalene mineralization for strain NP-Alk in a soil free (o),
Colwood (a) and Oshtemo (b) soil slurries with 66.7 (), 133 P),
or 200 (11) mg/mL (From Guerin and Boyd, 1992) 116
4-8. Naphthalene mineralization time courses for strain 17484 in a soil-
free control and Capac (a) and Colwood soil suspensions (From
Guerin and Boyd, 1992) 117
4-9. Conceptualization of quinoline biodegradation in the presence of
smectite clay minerals 122
4-10. Schematic of CSFTR system used to monitor quinoline
biodegradation 129
4-11. Quinoline biodegradation in a Norborne soil column with limiting
nutrients 137
4-12. Biodegradation of quinoline and production of 2-HQ by the 3N3A
isolate in the CSFTR 140
4-13. Alteration of bacterial activity upon introduction of Norborne clay
and silt as measured by the change in biodegradation of quinoline. 142
x


141
suggested that the CSFTR is an appropriate technique for monitoring rapid
biodegradation kinetics. Unfortunately, for every advantage of a particular
technique, disadvantages are waiting to be discovered. After 1000 minutes, the
CSFTR started to leak around the shaft (Figure 4-10) and the experiment was
stopped. At this point the o-rings within the system were wearing out and the
bacteria were potentially clogging the 0.2 /m outlet filter. The build up in
pressure likely caused the system to leak.
A second CSFTR was equilibrated with the 3N3A isolate and the above
experiment repeated (Figure 4-13). In these experiments the CSFTR was
flushed with 0.05 M CaCI2 to remove the excess metabolites from the
nutrient/inoculation solution. Figure 4-13a verified the approach to steady state
in the CSFTR agrees with observations in the first experiment. Steady state was
attained in about 1500 minutes for both quinoline and 2-F1Q (Figure 4-13a, b).
Variations in bacterial culture conditions (length of time to introduction in the
CSFTR) may have cause a slight change in biodegradation (Fletcher, 1986).
Bacterial-surface interactions. Utilizing perturbation techniques
(DiGrazia et al., 1991) facilitates evaluating the influence of a particular
parameter in a complex system. The impact of surfaces on bacterial activity
has long been studied. Flowever, an increase in nutrient and substrate
concentrations where biodegradation is limiting may confound these results. A
perturbation of the CSFTR where bacteria were at steady state, with respect to
quinoline and 2-FIQ degradation, would provide insight into the impact of


19
- [v oe vq [v qq 2>( 0-5)
di at
where C = solution-phase concentration (M/L3); S = sorbed-phase
concentration (M/M); t = time (T); p = soil bulk density (M/L3); 0 = fractional
volumetric water content (dimensionless); D = hydrodynamic dispersion
coefficient (L2/T); x = distance (L); q = Darcy flux for water flow (L/T); and 0¡
= rates (M/L3"!") of loss or gain via various sinks and sources. In Eq (1-5),
multi-dimensional, advective-dispersive solute transport in a heterogeneous
porous medium under transient water flow conditions (first two terms on the
r.h.s.) is coupled to sorption dynamics (third term on r.h.s.) and biodegradation
kinetics (last term on r.h.s.). Differences in published models arise from the
specific manner in which sorption and degradation kinetics are modeled,
whether transient or steady flow is considered, and if one- or multi-dimensional
transport is of interest.
For one-dimensional steady, saturated water flow conditions in a
homogeneous medium, eq (1-5) can be restated as
2 D2!2 v22 +
dt 3x2 dx Q dt 6^ 1
(1-6)
where v=(q/6) is the average pore-water velocity (L/T).
Assuming that sorption can be represented by the bicontinuum sorption
model with a Freundlich isotherm and that first-order biodegradation kinetics
apply to biodegradation (0 = kb9C), eq (1-6) is restated as follows:


42
Eustis soil (pH 5.3) has a higher fraction of QH + present for the same initial
quinoline loading than the other soils (pH 6.4 and 6.9) (see Figure 2-2). The
isotherm nonlinearity for the Eustis soil remains constant at high concentrations
of QH+. This suggests that sorption of the neutral species may be occurring in
the higher pH soils. Another possible explanation is that high energy cation
exchange sites are the first sites occupied by quinoline, followed by sorption
onto lower energy sites such has been shown for sorption of inorganic
compounds (OConnor et al., 1983).
Investigation of quinoline sorption kinetics suggested that sorption
occurred via a three step process (Figure 2-4). About 20% of quinoline sorption
occurred onto readily available or instantaneously accessible sorption sites.
These sites have typically been thought to exist on external regions of the
sorbent matrix (Brusseau and Rao, 1990). However, these sites may include
external sites or readily accessible internal sites depending upon the
architecture of the sorbent (Okuda, 1993). Sorption of quinoline occurs
predominantly on cation exchange sites located within organic matter and
smectite minerals. The slower rates of quinoline sorption likely correspond to
sorption and redistribution in the internal less-accessible regions of the sorbent.
In a binary solute batch system, quinoline sorption at low concentrations
was unaffected by the presence of its primary degradative metabolite, 2-
hydroxyquinoline (2-HQ), at pH 6.8 (Figure 2-5). The data points at the highest
quinoline concentration had the greatest amount of scatter in the data which


165
Perrin, D.D., B. Dempsey, E.P. Serjeant. 1981. pKa prediction for organic acids and
bases. Chapman and Hali, New York.
Pirt, S.J. 1975. Principles of microbe and cell cultivation. Halsted Press, John Wiley
and Sons, New York.
Pritchard, H.P., and C.F. Costa. 1991. EPA's Alaska oil spill bioremediation report.
Environ. Sci. Technol. 25:372-379.
Rao, P.S.C., C.A. Beilin, and M.L. Brusseau. 1993a. Coupling biodegradation of
organic chemicals to sorption and transport in soils and aquifers: paradigms
and paradoxes. In D. Linn and T. Carski (eds.), Sorption and degradation of
pesticides and organic chemicals in soil. SSSA Publication no. 32. Madison,
Wl.
Rao, P.S.C., C.A. Beilin, and L.S. Lee. 1993b. Sorption and biodegradation of organic
contaminants in soils: Conceptual representations of process coupling. In
Proceedings of the First Meeting of the International Soil Sci. Soc. Work Group
MO, August 11-15, 1992, Edmonton, Alberta, Canada.
Reddy, K.R., P.S.C. Rao, and R.E. Jessup. 1982. The effect of carbon mineralization
on denitrification kinetics in mineral and organic soils. Soil Sci. Soc. Am. J.
46:62-68.
Rhue, D.R., and W.FI Reve. 1990. Exchange capacity and adsorbed-cation charge as
affected by chloride and perchlorate. Soil Sci. Soc. Am. J. 54:705-708.
Rinjnaarts, H.H.M., A. Bachmann. J.C. Jumelet, and A.J.B. Zehnder. 1990. Effect of
desorption and intraparticle mass transfer on the aerobic biomineralization of a-
hexachloroclohexane in contaminated calcareous soil. Environ. Sci. Technol.
24:1349-1354.
Rittman, B.E., and P.L. McCarty. 1978. Variable-order model of bacterial-film kinetics.
J. Environ. Engin. 104:889-900.
Rittman, B.E. and P.L. McCarty. 1980. Model of steady-state-biofilm kinetics.-
Biotechnol. Bioeng. 22:2343-2357.
Robinson, K.G., W.S. Farmer, and J.T. Novak. 1990. Availability of sorbed toluene in
soils for biodegradation by acclimated bacteria. Wat. Res. 24:345-350.
Rosenberg, M., D. Gutnick, and E. Rosenberg. 1980. Adherence of bacteria to
hydrocarbons: a simple method for measuring cell surface
hydrophobiclty. FEMS Microbiol. Letters. 9:29-33.


107
aggregates are formed, microorganisms may become trapped within the soil
aggregate. However, the biodegradation by aerobic microorganisms is likely
reduced or stopped upon depletion of oxygen within the aggregate. Size
constraints limit migration of microorganisms within the soil aggregate.
Therefore, intracellular biodegradation by aerobic microorganisms likely occurs
in the bulk solution-phase resulting in diffusion-limited biodegradation from
aggregates or sorbent matrices found in soil-water suspensions. The
contaminant residing within the interior of the aggregate, organic matrix, or
phyllosilicate mineral is not readily available for biodegradation.
Several models considering diffusion- and desorption-limited
biodegradation have been developed for batch and column techniques. Scow
and Hutson (1992) developed a diffusion-sorption-biodegradation (DSB) model
describing diffusion-limited biodegradation of contaminants out of interior
regions of aggregates in a batch system. Figure 4-2 presents simulations of the
influence of sorption partition coefficients on the biodegradation of solutes
diffusing out of an aggregate with a radius of 0.05 cm. The final mass
degraded approaches a constant value and only the rates of approach are
decreased with increasing sorption coefficient value. Interpretation of this
simulation would suggest that biodegradation is diffusion limited. Figure 4-3
presents data and DSB model simulations for glutamate from gel exclusion
beads. Increasing the sorbent mass increases the fraction of glutamate mass
in the sorbed phase, which decreases the biodegradation rate. However, the


83
Results
The behavior of PFBA in sterile and bacterial-inoculated columns is
represented by the PFBA breakthrough curve (BTC) in Figure 3-1. BTCs for
quinoline (0.005 M CaCI2) in a sterile and inoculated (B53 and 3N3A isolates)
columns are also shown in Figure 3-1. BTCs for 45Ca and naphthalene (0.05 M
CaCI2) in sterile and inoculated B53 columns are shown in Figure 3-2 and 3-3,
respectively. The PFBA BTCs for all soil columns were symmetrical and sigmoidal
in shape, which suggests the absence of physical nonequilibrium (Brusseau and
Rao, 1989b), and P > 98 is indicative of minimal hydrodynamic dispersion.
Quinoline and naphthalene sorption was reduced in inoculated soil columns
(Figures 3-1 and 3-3). 45Ca sorption (Figure 3-2) was not reduced in the B53
inoculated soil columns. The shift in the 45Ca BTC in the two bacterial-inoculated
soil columns (BQ11 and BQ112) and the sterile column (B) resulted from
differences in the bulk densities (p) and volumetric water contents (0) of the
various columns (Table 3-1). Therefore, direct comparison of R for different
columns is misleading. The impact of bacteria on sorption and transport of
quinoline, 45Ca, and naphthalene was assessed by comparing the Kj values in
sterile and inoculated columns. The Kj values verified that sorption of quinoline
and naphthalene was reduced in inoculated columns, whereas 45Ca sorption was
not significantly different.
The following results are from a series of experiments that were conducted
to deduce the causes of reduced quinoline and naphthalene sorption. Experiments


105
occurs intracellularly. Microorganisms may be excluded from most pores within
the sorbent matrices. Biodegradation, in this case, is limited by mass transfer
of the solute from the interior of the sorbent to the exterior solution. This
scenario is often used to describe biodegradation limited by intraparticle
(Chung, et al., 1993; Scow and Alexander, 1992) or intraorganic matter
diffusion. For several HOCs and a few ionic compounds (e.g., diquat), mass
transfer has been shown to limit sorption/desorption rates and biodegradation
(See Chapter 1).
A majority of organic contaminants are degraded intracellularly, therefore,
desorption of contaminants is required for microbial uptake and subsequent
biodegradation. Sorption of HOCs is generally reversible (Chiou et al., 1983),
whereas contaminants such as diquat may become irreversibly bound within
interlayers of clay minerals (Weber and Coble, 1968). For HOCs, the total
contaminant degraded should not be limited by sorption unless enzymes
necessary for biodegradation are not sustained.
Figure 4-1 presents a schematic view of the spatial arrangement of
microorganisms and solutes in a soil aggregate. The sorbed-phase solute (S)
is located primarily within the sorbent matrix. The concentration of solute in the
>
pore water (C) and bulk solution-phase (C) is dependent on the sorption
capacity of the soil and the microbial biodegradative capacity. Microorganisms
exist predominantly on the external surface of soil particles or aggregates.
Upon growth, microorganisms may slough off into the solution-phase. As soil


Relative Concentration (C/C^
63
1
0.8
0.6
0.4
--
jd
o
^ O

oO

o
o
o
o
O
o
CU
8 a?
CO
0
o
CM
O
O
o
o
0.2
o
0
10
o 12 C-Quinoline
14 C-Quinoline
20
Pore Volumes (p)
30
Figure 2-11. Isotopic exchange of 12C-quinoline and 14C-quinoline
in 0.05 M CaCI2 (pH 6.2) in the Norborne soil.
40


102
speciation changes at the soil-solution interfaces which were induced by
bacterial biomass. The sorption of an inorganic cation (calcium) was not
affected by the presence of bacterial biomass, suggesting that blockage of
cation exchange sites was minimal. HOC sorption was slightly reduced due to
a combination of processes including blockage of organic regions by
hydrophilic bacteria and biofacilitated transport. Naphthalene has a log Kow of
about 2 and biofacilitated transport was not substantial. However, compounds
with log Kow values (>6) are more likely to sorb onto bacteria and thus, their
transport can be enhanced.
Near waste disposal sites, microbial populations and colonization of
surfaces is likely. Therefore, enhanced contaminant transport may occur either
due to biomass-induced speciation changes of sorbent surfaces or biosorption
and biofacilitated transport. Stimulation of bacterial growth activity as a result of
bioremediation practices may enhance contaminant transport if conditions for
biodegradation are not favorable. Understanding the factors that influence
biodegradation are necessary to overcome the limitations of bioremediation
practices such that contaminants are removed to the desired concentration.


81
homogeneous distribution of the bacteria. The aspirator was rinsed with a 0.5-
mL aliquot of filtered (0.2 /xm) CaCI2, and the rinsate was sprayed on the soil.
The initial inoculation rate was 106 cfu/g soil unless otherwise indicated. The
soil was mixed again, and a subsample was taken for water content
determination. The soil-water content following bacterial addition ranged from 5
to 10%.
Column Studies
Miscible displacement techniques were used to characterize the transport
of PFBA, 45Ca, quinoline, and naphthalene. The sterile or bacterial inoculated
soil was packed into a Kontes glass column (5 cm long, 2.5 cm i.d.) as
described in Chapter 2. After packing, approximately 150 pore volumes of
0.005 or 0.05 M CaCI2 solution were pumped through the column to achieve
saturated, steady water flow conditions and uniform bacterial populations (108
cfu/g). Soil columns varied in bacterial density and type (sterile, or inoculated
with either B53 or 3N3A isolate) and in ionic strength (0.005 or 0.05 M) of the
displacing solution. Solute concentrations were monitored continuously or by
collecting column effluent fractions. Dissolved oxygen (DO) in the soil column
effluent was measured at different pore-velocities from 0.6 to 90 cm/hr. A
vessel was purged with N2, effluent from the column introduced, and DO
measured with a dissolved oxygen electrode (Yellow Springs Instruments 5750).
Sorption of quinoline by live cells of the B53 and 3N3A isolates was
measured at a bacterial density of 108 cfu/mL. The initial quinoline


125
consuming oxygen and substrate. Bacterial growth at the center of the colony
may be substrate-limited because its separated from the source, while bacteria
near the agar surface may be limited by oxygen that was utilized in
transformation processes.
In far-field regions, oxygen levels increase and contaminant
concentrations decrease likely supporting a wide variety of microorganisms.
The levels of oxygen necessary to support biodegradation by strict aerobes
may vary with the particular isolate. The oxygen content required by the 3N3A
isolate for biodegradation of quinoline is not known.
Physical heterogeneities in aquifer materials are known to create zones
of mixing that increase oxygen contents and provide necessary nutrients for
bacteria (MacQuarrie and Sudicky, 1990). Increased ground water flow
velocities and unsaturated zones increase the potential for addition of oxygen
into porous media. Reducing the residence time within a given region by
increasing flow velocities decreases the potential for consumption of oxygen
and nutrients. Unsaturated zones enhance diffusion and penetration of oxygen
in the gaseous-phase versus the solution-phase. Given that bacteria require
oxygen, understanding the effects of pore-water velocity on oxygen
consumption by the 3N3A isolate is essential to avoid cessation of
biodegradation.
Essential nutrients are required by bacteria for maintenance of simple
physiological functions and biodegradation (Lynch, 1988). Nutrients may be


71
corresponding to a decrease in sorption upon solvent addition (Fu and Luthy,
1986a). Transport parameters for two Eustis soil columns are presented in
Table 2-3. Cosolvent effects on solubility and sorption of quinoline is
confounded by specific solvent-sorbent and solvent-solute interactions. The self
sharpening front is indicative of isotherm nonlinearity. Sorption of quinoline in
up to 40% methanol was nonlinear (Zachara et al., 1988). However, sorption
isotherms of pesticides have shown increased linearity upon addition of
cosolvents (Nkedi-Kizza et al., 1985).
Direct observation of the organic matter surfaces was attempted by
taking a scanning electron micrograph (SEM) of an organic soil (Figure 2-14).
The soil was dried at 60C and gold coated to prepare the sample. The soil
was not fixed with glutaraldehyde or dehydrated with solvents to minimize
structural changes due to fixative agents. The SEM shows the heterogeneity
association with the surface of organic matter (Figure 2-14a). However, the
interior of the organic matrix which is the major sink for HOCs is not visualized
using this technique. We do, however, come to appreciate the complexity of
the organic surface and the relative scale at which we need to view the organic
matrix to observe the location of the contaminants within this region. For
example, the magnification of this SEM is 6000 X. The scale provides reference
to the size of quinoline. The quinoline molecule conceptualized in Figure 2-10 is
1 nm in length, suggesting that about 3000 quinoline molecules
would fit along the scale key. One begins to envision molecules diffusing
through this heterogeneous media and the concept of rate-limited sorption.


87
Table 3-1. Column parameters and Kf values for quinoline, naphthalene, and
45Ca In sterile and inoculated Norborne soil columns.
CaCI2
P
e
Kf
Column ID
mol/L
pH
g/cm3
cm3/cm3
Quinoline
Naphthalene
45Ca
Sterile, BQ5
0.005
7.0
1.48
0.44
3.11

10.0
Sterile, B
0.05
7.0
1.54
0.42
3.11
0.946
1.17
B53, BQ9
0.005
6.8
1.46
0.45
1.39


B53, BQ11
0.05
6.6
1.44
0.41
1.05
0.555
1.05
B53, BQ112
0.05
6.7
1.44
0.46


1.06
3N3A, BQ6
0.005
6.9
1.39
0.46
2.42


focused on distinguishing between the processes that may influence
contaminant sorption and transport including altered water flow resulting from
pore blockage, biofacilitated contaminant transport, and/or altered sorption
capacity of soil.
Pore Blockage
Pore blockage or straining of bacteria was investigated by measuring
BTCs for a nonadsorbed tracer (PFBA) once a day for 7 days following
bacterial inoculation. Variations in pore volume determinations or asymmetrical
BTCs would indicate changes in physical characteristics of the column. In all
cases, the BTCs measured for PFBA were symmetrical (indicative of no
changes in hydrodynamic characteristics) and the pore volume determined by


45
caused variation in the 1/n values. McBride et al. (1992) suggested that by
adding 2-HQ (5 and 20 mg/L) quinoline sorption in soil columns was reduced
as much as 23%. Competitive adsorption has been shown for NHCs such as
pyridine, quinoline, and acridine (Zachara et al., 1987) where the compounds
adsorb onto the same limited number of cation exchange sites. For HOCs,
competitive sorption is not likely because sorption occurs via partitioning (Chiou
et al., 1983). 2-HQ exists in its neutral form (pKa = 1.7) in the Norborne soil.
The predominant mechanism of 2-HQ sorption is hydrophobic partitioning, while
quinoline sorption occurs predominantly onto cation exchange sites. Therefore,
competitive sorption was not expected. If however, organic matter is located in
conjunction with the phyllosilicate minerals (Stevenson, 1985) quinoline sorption
may have been reduced due to the interference of 2-HQ and quinoline sorbing
in the same location of the organic matter-mineral complex. This behavior may
become more apparent in column studies (McBride et al., 1992) where
diffusional mass transfer constraints further limit sorption. These studies
suggest that 2-HQ production upon quinoline biodegradation is not likely to
reduce quinoline sorption by competing for available sorption sites.
Sorption Dynamics
Physical characterization. The 3H20 and PFBA breakthrough curves
(BTCs) for all soil columns were symmetrical and sigmoidal in shape (e.g.,
Figure 2-6) suggesting the absence of transport-related nonequilibrium. Peclet
numbers (P) were all greater than 80 indicating minimal hydrodynamic


62
Isotopic exchange of 12C-quinoline/14C-quinoline was measured to
determine the exchange of quinoline molecules during displacement with 0.05 M
CaCI2 in a Norborne soil column (Figure 2-11). The breakthrough of quinoline
was first monitored in a 0.05 M CaCI2 background matrix solution. After 7 flow
interruptions (3 shown in Figure 2-9), the equilibrium solution concentration was
98% of the influent concentration. At this point, a solution of 14C-quinoline and
12C-quinoline (same total concentration) in 0.05 M CaCI2 was introduced into
the column. The breakthrough of 14C-quinoline was delayed following
preconditioning with 12C-quinoline and the drop in relative concentration (25%
versus 50%) during flow interruption decreased. Apparent increased retention
(delayed breakthrough) in the 14C-quinoline column may have been caused by
decreased pH (6.1). However, the change in pH causes about a 1% increase
in the fraction of QH+ and it is not likely to cause this shift in breakthrough.
Two cases will be presented as alternatives for the isotopic exchange data.
First, the decreased drop in relative concentration of the 14C-quinoline versus
12C-quinoline BTC suggests that equilibrium is more readily approached by 14C-
quinoline. A decrease in rate-limited sorption sites would result in a reduced
drop during the flow interruption. This may occur if quinoline surface
complexes are formed in interlamellar regions. However, this would
simultaneously decrease cation exchange capacity, resulting in early quinoline
breakthrough (lower R). In fact breakthrough was delayed, therefore, this was
reasoned not to be a viable option.


96
pH may cause a decrease in cation exchange capacity. The surface area of
the bacterial biomass is five orders of magnitude smaller than the external soil
surface area. Therefore, the distribution of bacteria on the soil surface and their
relation to the sorptive region is important.
The addition of bacteria influenced quinoline retention more than the
sorption of naphthalene or 45Ca. Therefore, quinoline was used to further
investigate the differences between the effects of 3N3A and B53 isolates on
sorption and transport. The presence of the B53 isolate reduced the sorption
of quinoline by about 60%, and 3N3A reduced quinoline sorption by about 20%
(Table 3-1). Despite the differences in inoculation rate (106 cfu/g 3N3A, 105
cfu/g B53), the early quinoline breakthrough in inoculated (B53 versus 3N3A)
columns was not likely due to variations in bacterial populations. To test the
above hypothesis, soil columns were inoculated with the B53 isolate at 105, 106,
and 107 cfu/g. Quinoline BTCs measured in each case were similar.
Saturation of the soil columns prior to conducting the quinoline BTCs resulted in
growth and colonization of soil surfaces. Bacterial densities of 108 cfu/g were
supported in the Norborne soil independent of the initial inoculation rate and
bacterial isolate. As a result, the differences in quinoline BTCs measured in the
inoculated (3N3A and B53) soil columns were attributed to microbial surface
characteristics and their impact on the soil surfaces.
Surface Accessibility
An attempt was made to use the bicontinuum model to quantitatively
assess the impacts of bacterial biomass on the physical accessibility of sorptive


90
from 0.5 to 2 mg/L in the column effluent and increased with an increase in
velocity (6 to 90 cm/hr). As a result, subsequent experiments were conducted
at about 15 cm/hr. Transport of bacteria through the soil column is a
necessary, but not a sufficient, condition for claiming biofacilitated transport of
contaminants. It was also necessary to establish that the contaminant was
sorbed to an appreciable extent by the bacterial biomass.
Biosorption. Quinoline and 45Ca biosorption by the 3N3A isolate or its
mutant B53 was not measurable at 5C or room temperature (22-25C) using
batch techniques. However, variations in pH, nutrients, and availability of
surfaces may alter the sorptive characteristics of microbial surfaces (Beveridge
and Graham, 1991). Therefore, biosorption of quinoline and 45Ca was
determined directly in column experiments. Filtration (0.2 jam) of the column
effluent to separate biosorbed (trapped with the biomass on the filter) and free
species (in the filtrate) showed no reduction in the solution concentration or
accumulation on the filter. Therefore, biofacilitated transport of quinoline and
45Ca by bacteria in the solution phase was not likely.
The extent of 45Ca, quinoline, and naphthalene biosorption by adsorbed
bacteria was determined by BTCs measured in a column packed with glass
microbeads and inoculated with the B53 isolate (107 cfu/g). Miscible
displacement techniques are preferred for estimating sorption parameters,
especially in low-sorptive systems (Brusseau et al., 1991) (i.e., small Kp). The R
for quinoline, 45Ca, and naphthalene in a sterile, glassbead column was


Relative Concentration (C/C0)
86
0.6 -
0.2
o
o
o
o o
o
o
o
o
o
o

o
o


Sterile (B)
B53 (BQ11)
5 10
Pore Volumes (p)
15
Figure 3-3. Measured BTCs for Naphthalene in a sterile (@) and a
B53 inoculated (o) soil column. Column designations
are given in parenthesis corresponding to Table 3-1.


168
Tsezos, M., and J.P. Bell. 1989. Comparison of the biosorption and desorption of
hazardous organic pollutants by live and dead biomass. Wat. Res. 23:561-568.
Vandevivere, P., and P. Baveye. 1992. Saturated hydraulic conductivity reduction
caused by aerobic bacteria in sand columns. Soil Sci. Soc. Am. J. 56:1-13.
van Genuchten, M. Th. 1981. Non-equilibrium transport parameters from miscible
displacment experiments. USDA, U.S. Salinity Lab., Research Report No. 119.
van Genuchten, M. Th., and R.J. Wagenet. 1989. Two-site\two-region models for
pesticide transport and degradation: Theoretical development and analytical
solutions. Soil. Sci. Soc. Am. J. 53:1303-1310.
van Loosdrecht, M.C.M., J. Lyklema, W. Norde, G. Schraa, and A.J.B. Zehnder. 1987.
Electrophoretic mobility and hydrophobicity as a measure to predict the initial
steps of bacterial adhesion. Appl. Environ. Microbiol. 53:1898-1901.
van Loosdrecht, M.C.M., J. Lyklema, W. Norde, and A.J.B. Zehnder. 1990. Influences
of interfaces on microbial activity. Microbiol. Rev. 54:75-87.
Weast, R.C. 1984. CRC handbook of chemistry and physics. CRC Press, Inc., Boca
Raton, FL.
Weber, E.J. 1991. Studies of benzidine-based dyes in sediment-water systems.
Environ. Toxicol. Chem. 10:609-618.
Weber, J.B., and H.D. Coble. 1968. Microbial decomposition of diquat adsorbed on
montmorillonite and kaolinite on clays. J. Agrie. Food Chem. 16:475-478.
Widdowson, M.A., F.J. Molz, and L.D. Benefield. 1987. Development and application
of a model for simulating microbial growth dynamics coupled to nutrient and
oxygen transport in porous media, p. 28-51. In Proc. of the NWWA/IGWMC
Conf. on Solving Ground Water Problems with Models. Denver, CO, Feb. 10-
12, 1987. Nat. Water Well Assoc., Dublin, OH.
Widdowson, M.A., F.J. Molz, and L.D. Benefield. 1988. A numerical transport model
for oxygen- and nitrate-based respiration linked to substrate and nutrient
availability in porous media. Water Resour. Res. 24:1553-1565.
Wilklander, L. 1964. Cation and anion exchange phenomena, p. 163-205. In F.E. Bear
(ed.), Chemistry of the soil (2nd ed.). Reinhold Publishing Co., New York.
Wollum, A.G., II. 1982. Cultural Methods for Soil Microorganisms, p. 781-814. In A.L.
Page, R.H. Miller, and T.R. Keeney (eds.), Methods of soil analysis Part 2 -
Chemical and microbiological properties (2nd ed.). ASA/SSSA, Madison, Wl.


144
The differences between the two CSFTR experiments have yet to be
resolved. It is possible the 500-minute delay in the addition of soil changed the
physiological activity of the 3N3A isolate. Figure 4-13a suggests that the
bacterial activity is initially altered upon addition of soil, followed by a period of
adaptation, and approach to a new steady state. The bacterial activity may
have been slightly reduced as a result of coverage of the bacterial isolate by
clay particles causing decreased surface area of the bacteria. The surface area
of the bacteria is about 1 /zm2/cfu. The Norborne soil has a surface area of
about 10 m2/g (Zachara et al., 1988). The surface area of the soil is about
1000 times greater that the surface area of the bacteria in the CSFTR.
Therefore, the reduction of biodegradation due to reduced available surface
area is plausible.
In Figure 4-13b, the plateau value of 2-HQ suggests that bacteria may be
coated with soil particles limiting intracellular uptake and subsequent
biodegradation. Addition of the Norborne silt and clay in abiotic CSFTR
systems did not alter the solution phase concentration of quinoline or 2-FIQ at
this mass to volume ratio. Therefore, the increase in 2-HQ was assumed to
result from bacteria-clay interactions. Clay particles have been shown to
adsorb onto bacterial surfaces. In this system, bacteria likely exist in discrete
colonies with clay particles attached to their surfaces. The addition of surfaces
did not appreciably alter the membrane-mediated degradation of quinoline.
However, 2-HQ degradation decreased and approached a higher steady state


Normalized to Quinoline
140
Figure 4-12. Biodegradation of quinoline and production of 2-HQ by
the 3N3A isolate in the CSFTR.


Fraction Mineralized
113
Time (min)
Figure 4-5. Simulation of naphthalene degradation in soil
suspensions. The lines were generated using the
bicontinuum model with first order biodegradation
kinetics, (model input parameters from Guerin and
Boyd, 1992).


40
increased about 28% after autoclaving. The standard deviation of the CEC
estimates for this sample, however, was high. Nonuniformity in soil sampling
may have caused some of this error. On the other hand, the increase may
have been caused by release of organic acids, alteration of the organic matter
structure, or a change in the interfacial pH though the bulk pH is the same.
The soils (Table 2-1) varied in pH, cation exchange capacity, and location
of charge. The quinoline sorption isotherm, plotted on a log-log scale, was
normalized to the protonated species (QH +) in the sorbed and solution phases
and the CEC of the soil (mmol(-)/g). The sorption data for all soils can be
represented by a single scaled isotherm (Figure 2-3), suggesting that quinoline
sorption occurs primarily via cation exchange. Sorption isotherms were
nonlinear (1 /n = 0.68 to 0.8) over the concentration range investigated. At
higher concentrations (Figure 2-3), sorption of quinoline increases in the
Norborne and Webster soil. The S-type sorptive behavior for these soils occurs
at high concentrations (100 mg/L), where > 95% of quinoline is present as the
neutral species.
Cooperative interactions between the sorbed species and multilayer
sorption has been suggested to enhance quinoline sorption clay minerals at
high concentrations (Ainsworth et al., 1987). However, at this concentration
less than 1% of the cation exchange sites are occupied by quinoline. This
behavior may result from aggregation of sorption sites where quinoline sorption
occurs in collocation with clay mineral aggregates or organic matter. The


30
Sorption of the quinolinium ion has been shown even at pH values as much as
2 units greater than its ionization constant (pKa = 4.92) (Zachara et al., 1986;
Smith et al., 1992). Therefore, in a Ca+2 saturated homoionic soil, the following
cation exchange reaction can be used to describe quinoline exchange with
Ca+2:
CaR2 + 2QH+ ^ 2QHR + Ca+2 (2-3)
where QH + is the aqueous concentration of the quinolinium ion, Ca+2 is the
aqueous concentration of Ca+2, CaR2 is the Ca on the exchanger complex, and
QHR is the quinoline on the exchanger complex. The equilibrium constant
describing this reaction is given as follows:
K [(QHR)2 (Ca-2)] .
ex [(CaRJ(QH+)2]
where () refers to the activity of QH+ and Ca+2 in the solution and exchange
phase. The conditional equilibrium constant (Ke^ or Vanselow selectivity
coefficient (KJ for eq 2-3 is depicted as
K [XHH (Ca>2)1 (2-5)
[Xcr^OH*)2]
where X is the mole fraction, (QH+) is the activity of QH+ in solution, and (Ca+^
is the activity of Ca+2 in solution. In eq 2-5, the activities in the exchanger
phase are represented by X. The selectivity coefficient (K^) is related to the
equilibrium constant (Kex), if the reaction is reversible, by the relationship:


65
95-98% after the flow Interruption. In the pH 6.2 column, C/C0 approached 1
rapidly after the flow Interruption. In the pH 6.2, 4.7, and 3 columns, the flow
Interruption resulted in a 50, 18, and 2% drop In relative concentration,
respectively. Diffusion into clay Interlayer positions is pH dependent. At first
glance It appears that nonequillbrlum Is greater at higher pH values. However,
as the pH decreases the fraction of protonated species Increases and R
increases which may alter access Into these regions. A larger R, a highly
selective exchange coefficient, and sterlc hindrances may further limit quinoline
entry Into the clay Interlayer positions. Rate-limited sorption of quinoline may be
related to both the magnitude of selectivity coefficients (Ainsworth et al., 1987)
and the ability of quinoline to delocalize Its charge over the entire surface of the
compound (Zachara et al., 1990).
Replacement of hydrogen ions for 40Ca on exchange sites may alter the
clay Interlayer environment, thus, quinoline migration Into Interlayers. As a
result, the ability to access Interlayer positions as the pH decreases may be
further constrained. It may be possible that mass transfer Is restricted beyond
the time allowed for flow Interruption (8.8 h, pH 3 column), modeling the data
assuming flow interruption occurred for a longer period of time (16.6 d) would
result In a large drop during flow interruption. The model fit (granted the error
associated with the use of this model) suggests that mass transfer Is more
constrained than Indicated for the 8.8 hour flow interruption. However, a flow
interruption for as much as 10 days in a pH 5 column resulted In only an 8%


LIST OF FIGURES
Figure page
2-1. Calcium () and quincline (o) BTCs: a) pH 6, v = 0.162 cm/s and
b) pH = 6.9, v = 0.063 cm/s. Lines correspond to equilibrium
(solid) and first-order models (dash), (from Szecsody and Streile,
1992) 27
2-2. Quinoline speciation diagram and the protonated and neutral
species structures 29
2-3. Quinoline sorption isotherms for three soils normalized to their
cation exchange capacity and to the fraction of protonated
species 41
2-4. Stirred batch reactor (a) and quinoline sorption onto the Norborne
soil fraction < 50 ^m (b) (where C = quinoline filtrate
concentration and CQ = the initial quinoline concentration) 43
2-5. Sorption of quinoline on the Norborne soil in the presence of 2-
hydroxyquinoline 44
2-6. Examples of breakthrough curves for PFBA and 3H20 in Norborne
soil columns 46
2-7. Quinoline and 45Ca breakthrough curves with flow interruptions in
0.005 M (closed symbols) and 0.05 M (open symbols) CaCI2
Norborne soil columns 49
2-8. Quinoline breakthrough curves in 0.005 M (closed symbols) and
0.05 M CaCI2 (open symbols) in pH adjusted Norborne soil
columns 51
2-9. Repeated flow interruptions for quinoline in a 0.05 M CaCI2 (pH
6.2) Norborne soil column and bicontinuum model fit 55
VIII



PAGE 1

&283/('352&(66(6 ,17(5$&7,216 2) &217$0,1$176 %$&7(5,$ $1' 685)$&(6 %\ &+(5
PAGE 2

&RS\ULJKW E\ &KHU\O $ %HLOLQ

PAGE 3

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

PAGE 4

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f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

PAGE 5

7$%/( 2) &217(176 $&.12:/('*(0(176 c /,67 2) 7$%/(6 YLL /,67 2) ),*85(6 YLLL $%675$&7 [L &+$37(56 ,1752'8&7,21 2YHUYLHZ RI WKH 3UREOHP 6RUSWLRQ %LRGHJUDGDWLRQ 7UDQVSRUW 5HVHDUFK 2EMHFWLYHV &+(02'<1$0,&6 2) 1+(7(52&<&/,& &203281'6 ,1 $%,27,& 6<67(06 %$7&+ $1' )/2:7+528*+ 7(&+1,48(6 ,QWURGXFWLRQ 4XLQROLQH 6RUSWLRQ '\QDPLFV 5HVHDUFK 4XHVWLRQ DQG 7DVNV 0DWHULDOV DQG 0HWKRGV 5HVXOWV DQG 'LVFXVVLRQ 6XPPDU\ $/7(5$7,21 2) 685)$&(6 %< %$&7(5,$/ %,20$66 IW ,QWURGXFWLRQ 5HVHDUFK 4XHVWLRQ DQG 7DVNV 0DWHULDOV DQG 0HWKRGV 5HVXOWV Y

PAGE 6

'LVFXVVLRQ 6XPPDU\ 48,12/,1( %,2'(*5$'$7,21 ,1 )/2:7+528*+ 6<67(06 ,QWURGXFWLRQ 4XLQROLQH %LRGHJUDGDWLRQ '\QDPLFV 5HVHDUFK 4XHVWLRQ DQG 7DVNV 0DWHULDO DQG 0HWKRGV 5HVXOWV DQG 'LVFXVVLRQ 6XPPDU\ 6800$5< $1' &21&/86,216 6XPPDU\ &RQFOXVLRQV 5()(5(1&(6 %,2*5$3+,&$/ 6.(7&+ YL

PAGE 7

/,67 2) 7$%/(6 7DEOH SDJH 6RLO SURSHUWLHV EHIRUH DQG DIWHU VWHDP DXWRFODYLQJ &ROXPQ SDUDPHWHUV IRU VWHULOH VRLO FROXPQV 6XPPDU\ RI HVWLPDWHG WUDQVSRUW SDUDPHWHUV IRU TXLQROLQH &ROXPQ SDUDPHWHUV DQG .M YDOXHV IRU TXLQROLQH QDSKWKDOHQH DQG &D LQ VWHULOH DQG LQRFXODWHG 1RUERUQH VRLO FROXPQV 1XWULHQW FRQFHQWUDWLRQ PJ/f H[WUDFWHG IURP WKH 1RUERUQH VRLO FROXPQ YLL

PAGE 8

/,67 2) ),*85(6 )LJXUH SDJH &DOFLXP Â’f DQG TXLQFOLQH Rf %7&V Df S+ Y FPV DQG Ef S+ Y FPV /LQHV FRUUHVSRQG WR HTXLOLEULXP VROLGf DQG ILUVWRUGHU PRGHOV GDVKf IURP 6]HFVRG\ DQG 6WUHLOH f 4XLQROLQH VSHFLDWLRQ GLDJUDP DQG WKH SURWRQDWHG DQG QHXWUDO VSHFLHV VWUXFWXUHV 4XLQROLQH VRUSWLRQ LVRWKHUPV IRU WKUHH VRLOV QRUPDOL]HG WR WKHLU FDWLRQ H[FKDQJH FDSDFLW\ DQG WR WKH IUDFWLRQ RI SURWRQDWHG VSHFLHV 6WLUUHG EDWFK UHDFWRU Df DQG TXLQROLQH VRUSWLRQ RQWR WKH 1RUERUQH VRLO IUDFWLRQ AP Ef ZKHUH & TXLQROLQH ILOWUDWH FRQFHQWUDWLRQ DQG &4 WKH LQLWLDO TXLQROLQH FRQFHQWUDWLRQf 6RUSWLRQ RI TXLQROLQH RQ WKH 1RUERUQH VRLO LQ WKH SUHVHQFH RI K\GUR[\TXLQROLQH ([DPSOHV RI EUHDNWKURXJK FXUYHV IRU 3)%$ DQG + LQ 1RUERUQH VRLO FROXPQV 4XLQROLQH DQG &D EUHDNWKURXJK FXUYHV ZLWK IORZ LQWHUUXSWLRQV LQ 0 FORVHG V\PEROVf DQG 0 RSHQ V\PEROVf &D&, 1RUERUQH VRLO FROXPQV 4XLQROLQH EUHDNWKURXJK FXUYHV LQ 0 FORVHG V\PEROVf DQG 0 &D&, RSHQ V\PEROVf LQ S+ DGMXVWHG 1RUERUQH VRLO FROXPQV 5HSHDWHG IORZ LQWHUUXSWLRQV IRU TXLQROLQH LQ D 0 &D&, S+ f 1RUERUQH VRLO FROXPQ DQG ELFRQWLQXXP PRGHO ILW 9,,,

PAGE 9

&RQFHSWXDO GLDJUDP RI TXLQROLQH VRUSWLRQ RQWR VPHFWLWH FOD\ PLQHUDOV ,VRWRSLF H[FKDQJH RI &TXLQROLQH DQG &TXLQROLQH LQ 0 &D&, S+ f LQ WKH 1RUERUQH VRLO %UHDNWKURXJK FXUYHV RI TXLQROLQH LQ (XVWLV VRLO ZLWK 0 &D&, DQG b PHWKDQRO 6WUXFWXUDO UHSUHVHQWDWLRQ RI RUJDQLF PDWWHU DGDSWHG IURP %KDU DQG 9DQGHQEURXFNH f 6FDQQLQJ HOHFWURQ PLFURJUDSK RI DQ RUJDQLF VRLO DW [ DQG [ 0HDVXUHG %7&V IRU 3)%$ f LQ D VWHULOH FROXPQ DQG IRU 4XLQROLQH LQ D VWHULOH pf 1$ LQRFXODWHG rf DQG % LQRFXODWHG Â’f VRLO FROXPQ &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH 0HDVXUHG %7&V IRU &D LQ VWHULOH pf DQG % LQRFXODWHG R DQG rf VRLO FROXPQV &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH 0HDVXUHG %7&V IRU 1DSKWKDOHQH LQ D VWHULOH kf DQG D % LQRFXODWHG Rf VRLO FROXPQ &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH 0HDVXUHG %7&V IRU 3)%$ rf &D pf 4XLQROLQH Sf DQG 1DSKWKDOHQH Rf LQ D % LQRFXODWHG VRLO FROXPQ U 6FKHPDWLF RI VRUSWLRQ DQG ELRGHJUDGDWLRQ LQ VRLO DJJUHJDWHV & DQG & WKH VROXWH FRQFHQWUDWLRQ LQ WKH SRUH ZDWHU LQVLGH WKH DJJUHJDWH DQG WKH EXON VROXWLRQ UHVSHFWLYHO\f DGDSWHG IURP 0LKHOFLF DQG /XWK\ Ff 7KH LPSDFW RI YDU\LQJ WKH VRUSWLRQ SDUWLWLRQ FRHIILFLHQW RQ ELRGHJUDGDWLRQ /NJf LQ WKH SUHVHQFH RI DJJUHJDWHV ZLWK UDGLL RI FP )URP 6FRZ DQG +XWVRQ f 'DWD V\PEROVf IRU DJJUHJDWHV ZLWK GLIIHUHQW UDGLL DQG '6% PRGHO VLPXODWLRQV VROLG OLQHVf RI PLQHUDOL]DWLRQ RI QJ &ODEHOHG JOXWDPDWHP/ LQ WKH SUHVHQFH RI JHO H[FOXVLRQ EHDGV )URP 6FRZ DQG $OH[DQGHU f L[

PAGE 10

0HDVXUHG DQG VLPXODWHG %7&V IRU 7 GHYHORSHG ZLWK WKH WZR UHJLRQ PRGHO IRU WKH WZR FDVHV RI QR GHJUDGDWLRQ OD f DQG GHJUDGDWLRQ D !f )URP *DPHUGLQJHU HW DO f 6LPXODWLRQ RI QDSKWKDOHQH GHJUDGDWLRQ LQ VRLO VXVSHQVLRQV 7KH OLQHV ZHUH JHQHUDWHG XVLQJ WKH ELFRQWLQXXP PRGHO ZLWK ILUVW RUGHU ELRGHJUDGDWLRQ NLQHWLFV PRGHO LQSXW SDUDPHWHUV IURP *XHULQ DQG %R\G f 6LPXODWLRQ XVLQJ WKH ELFRQWLQXXP PRGHO ZLWK ILUVWRUGHU ELRGHJUDGDWLRQ NLQHWLFV DVVXPLQJ LUUHYHUVLEOH VRUSWLRQ 1DSKWKDOHQH PLQHUDOL]DWLRQ IRU VWUDLQ 13$ON LQ D VRLO IUHH Rf &ROZRRG Df DQG 2VKWHPR Ef VRLO VOXUULHV ZLWK kf 3f RU f PJP/ )URP *XHULQ DQG %R\G f 1DSKWKDOHQH PLQHUDOL]DWLRQ WLPH FRXUVHV IRU VWUDLQ LQ D VRLO IUHH FRQWURO DQG &DSDF Df DQG &ROZRRG VRLO VXVSHQVLRQV )URP *XHULQ DQG %R\G f &RQFHSWXDOL]DWLRQ RI TXLQROLQH ELRGHJUDGDWLRQ LQ WKH SUHVHQFH RI VPHFWLWH FOD\ PLQHUDOV 6FKHPDWLF RI &6)75 V\VWHP XVHG WR PRQLWRU TXLQROLQH ELRGHJUDGDWLRQ 4XLQROLQH ELRGHJUDGDWLRQ LQ D 1RUERUQH VRLO FROXPQ ZLWK OLPLWLQJ QXWULHQWV %LRGHJUDGDWLRQ RI TXLQROLQH DQG SURGXFWLRQ RI +4 E\ WKH 1$ LVRODWH LQ WKH &6)75 $OWHUDWLRQ RI EDFWHULDO DFWLYLW\ XSRQ LQWURGXFWLRQ RI 1RUERUQH FOD\ DQG VLOW DV PHDVXUHG E\ WKH FKDQJH LQ ELRGHJUDGDWLRQ RI TXLQROLQH [

PAGE 11

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

PAGE 12

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f UHGXFHG TXLQROLQH VRUSWLRQ DQG UHWDUGDWLRQ LQ VRLO FROXPQV ZKLFK ZHUH DWWULEXWHG WR ELRPDVVLQGXFHG FKDQJHV LQ TXLQROLQH VSHFLDWLRQ DQG EORFNDJH RI VXUIDFH VLWHV ,Q FROXPQV LQRFXODWHG ZLWK D TXLQROLQHGHJUDGHU TXLQROLQH ZDV UDSLGO\ GHJUDGHG DQG ELRGHJUDGDWLRQ NLQHWLFV FRXOG QRW EH PHDVXUHG 7KH FRQWLQXRXVO\ VWLUUHG IORZn WKURXJK UHDFWRU ZDV XVHG DV DQ DOWHUQDWH WHFKQLTXH WR PRQLWRU UDSLG ELRGHJUDGDWLRQ NLQHWLFV NE VHFRQGVnf DQG WR PHDVXUH WKH UHVSRQVH WR LPSRVHG SHUWXUEDWLRQV ,QWURGXFWLRQ RI VRUEHQW SDUWLFOHV DW VWHDG\ VWDWH LH ELRGHJUDGDWLRQ RI TXLQROLQH WR K\GUR[\TXLQROLQH DQG RWKHU PHWDEROLWHVf UHVXOWHG LQ WZR UHVSRQVHV f DGGLWLRQ RI VRLO SDUWLFOHV UHTXLUHG UHDGDSWDWLRQ RI WKH EDFWHULDO LVRODWH DQG FDXVHG UHGXFHG GHJUDGDWLRQ UDWHV DQG f VRLO SDUWLFOHV ;,,

PAGE 13

UHGXFHG K\GUR[\TXLQROLQH XSWDNH DQG GHJUDGDWLRQ ZKLOH TXLQROLQH ELRGHJUDGDWLRQ ZDV QRW DOWHUHG ,Q WKLV FDVH EDFWHULDO DFWLYLW\ PD\ KDYH EHHQ UHGXFHG XSRQ EDFWHULDVRUEHQW DVVRFLDWLRQ ;,,,

PAGE 14

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f VWDWHG ,W LV P\ EHOLHI WKDW PDQ\ PLFURELRORJLVWV IDLO WR DSSUHFLDWH WKH HIIHFWV RI LQWHUIDFHV RQ PLFURELDO SRSXODWLRQV GHVSLWH WKH ZLGHVSUHDG RFFXUUHQFH RI VROLGOLTXLG JDVOLTXLG DQG OLTXLGOLTXLG LQWHUIDFHV LQ QDWXUDO PLFURELDO KDELWDWV ,PSRUWDQFH PXVW EH JLYHQ WR WKH QDWXUH GLVWULEXWLRQ DQG XQLTXH SK\VLFRFKHPLFDO SURSHUWLHV RI LQWHUIDFHV WKH LQWHUDFWLRQ EHWZHHQ PLFURRUJDQLVPV DQG LQWHUIDFHV DQG WKH PRGLI\LQJ HIIHFWV RI LQWHUIDFHV RQ WKH HFRORJ\ RI PLFURRUJDQLVPV Yf 2YHUYLHZ RI WKH 3UREOHP 7KH LPSURSHU XVH DQG DFFLGHQWDO UHOHDVH RI WR[LF RUJDQLF FRPSRXQGV LQWR WKH HQYLURQPHQW KDYH OHG WR ZLGHVSUHDG FRQWDPLQDWLRQ RI VRLOV DQG

PAGE 15

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f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f 7R LOOXVWUDWH WKH LPSRUWDQFH RI SURFHVV FRXSOLQJ 5DR HW DO Df SUHVHQWHG WZR GLIIHUHQW VFHQDULRV ,Q RQH FDVH VRUSWLRQ UHQGHUV WKH FRQWDPLQDQW XQDYDLODEOH IRU ELRGHJUDGDWLRQ DQG LQ WKH VHFRQG FDVH

PAGE 16

ELRGHJUDGDWLRQ LV XQDIIHFWHG E\ VRUSWLRQ 7KH ILUVW H[DPSOH VXJJHVWV WKDW GLIIHUHQFHV LQ ELRGHJUDGDWLRQ PD\ EH GXH WR WKH VRLO VRUSWLRQ FDSDFLW\ DQGRU YDULDWLRQV LQ PLFURELDO DFWLYLW\ 7KH VHFRQG H[DPSOH VXJJHVWV WKDW GLIIHUHQFHV LQ ELRGHJUDGDWLRQ DUH GXH VROHO\ WR YDULDWLRQV LQ PLFURELDO DFWLYLW\ DQG ELRDYDLODELOLW\ VRUSWLRQ RI FRQWDPLQDQWVf LV QRW D IDFWRU 7KH XVH RI ELRUHPHGLDWLRQ WHFKQRORJ\ LV KLQJHG XSRQ LPSURYLQJ H[LVWLQJ NQRZOHGJH RI WKH FRQWUROOLQJ SURFHVVHV DQG WKHLU DSSURSULDWH FRXSOLQJ VXFK WKDW WKH SUREDELOLW\ DQG SUHGLFWDELOLW\ RI UHPHGLDWLQJ D FRQWDPLQDWHG VLWH DUH LQFUHDVHG 7R IXOILOO WKLV WDVN LW LV QHFHVVDU\ WR f GHWHUPLQH WKH UHDVRQV IRU ELRUHPHGLDWLRQ IDLOXUHV f GHYHORS SUHGLFWLYH FRXSOHGSURFHVV PRGHOV IRU GHVFULELQJ FRQWDPLQDQW IDWH LQ WKH HQYLURQPHQW DQG f GHWHUPLQH WKH UDPLILFDWLRQV RI LQWURGXFLQJ EDFWHULD RU VWLPXODWLQJ EDFWHULDO JURZWK LQ VRLO DQG DTXLIHU PDWHULDOV WR SURPRWH ELRGHJUDGDWLRQ RI FRQWDPLQDQWV 7KH VXFFHVV RI ELRUHPHGLDWLRQ RI FRQWDPLQDWHG VRLOV DQG JURXQGZDWHU LV OLPLWHG GXH WR f WKH DELOLW\ WR GHJUDGH FKHPLFDOV WR DQ DFFHSWDEOH OHYHO DQG f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

PAGE 17

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f 'HYHORSPHQW RI DQ XQELDVHG FRXSOHGSURFHVV PRGHO UHTXLUHV D PXOWLGLVFLSOLQDU\ DSSURDFK +RZHYHU PRGHOV RIWHQ FRQWDLQ D SDUWLFXODU HPSKDVLV RQ D VLQJOH SURFHVV GHSHQGLQJ RQ WKH UHVHDUFKHUfV EDFNJURXQG 7KH FRQFHSWXDO EDVLV IRU WKH FRXSOLQJ RI VRUSWLRQ DQG ELRGHJUDGDWLRQ GXULQJ WUDQVSRUW ZDV SUHVHQWHG E\ 5DR HW DO Ef (PSKDVLV ZDV JLYHQ WR WKH LPSRUWDQFH RI DGHTXDWHO\ GHVFULELQJ FRQWDPLQDQW VRUSWLRQ DQG WKH LPSDFW RI WKH ELRPDVV RQ FRQWDPLQDQW EHKDYLRU 9DULRXV OHYHOV RI FRPSOH[LW\ DULVH ZKHQ GHVFULELQJ WKH SURFHVVHV WKDW FRQWURO FRQWDPLQDQW EHKDYLRU )UHTXHQWO\ PRGHOV DUH OLPLWHG E\ WKH DELOLW\ WR DFFXUDWHO\ PHDVXUH WKH SDUDPHWHU RI LQWHUHVW :KHQ GHDOLQJ ZLWK DTXLIHU

PAGE 18

PDWHULDOV VWHDG\ ZDWHU IORZ LV DVVXPHG +RZHYHU WKH XQVDWXUDWHG ]RQH DGGV VHDVRQDO YDULDWLRQV LQ VRLO ZDWHU FRQWHQW DQG WHPSHUDWXUH ZKLFK GLUHFWO\ RU LQGLUHFWO\ LPSDFW WKH SULPDU\ SURFHVVHV FRQWUROOLQJ WKH IDWH RI FRQWDPLQDQWV $ GHVFULSWLRQ RI WKH VRUSWLRQ G\QDPLFV LV SULPDULO\ FRQFHUQHG ZLWK HTXLOLEULXP RU UDWHOLPLWHG UHDFWLRQV ZKHUHDV PLFURELDO SURFHVVHV UHTXLUH GHVFULSWLRQV RI PLFURELDO NLQHWLFV HJ JURZWK DQG ELRGHJUDGDWLRQf DQG ELRPDVV GLVWULEXWLRQ ([WHQVLYH GDWD KDYH EHHQ JDWKHUHG GHVFULELQJ LQGLYLGXDO SURFHVVHV WKDW GHWHUPLQH WKH EHKDYLRU RI K\GURSKRELF RUJDQLF FRPSRXQGV +2&Vf (TXLOLEULXP VRUSWLRQ FRHIILFLHQWV .Sf IRU +2&V FDQ EH HVWLPDWHG IURP DTXHRXV VROXELOLW\ DQG RFWDQROZDWHU SDUWLWLRQ FRHIILFLHQWV DPRQJ RWKHUV FI *UHHQ DQG .DULFNKRII *HUVWO f 7KH VRUSWLRQ PDVVWUDQVIHU FRHIILFLHQWV Nf FDQ EH HVWLPDWHG IRU D YDULHW\ RI VRLOV DQG +2&V IURP WKH LQYHUVH ORJORJ UHODWLRQVKLS QRWHG EHWZHHQ N DQG .S %UXVVHDX DQG 5DR Df RU .RF $XJXVWLMQ f 6SHFLILF LQWHUDFWLRQV EHWZHHQ LRQL]DEOH RUJDQLF DFLGV DQG VRLO FDXVHG GHYLDWLRQV IURP WKH EHKDYLRU RI +2&V %UXVVHDX DQG 5DR Df &RPSOH[ VRUSWLRQ LQWHUDFWLRQV RI RUJDQLF EDVHV VXFK DV WKH QLWURJHQ KHWHURF\FOLF FRPSRXQGV 1+&Vf LQ VRLO KDYH QRW EHHQ DGHTXDWHO\ LQYHVWLJDWHG WR DVVHVV LI WKLV UHODWLRQVKLS LV YDOLG IRU 1+&V 7KH HVWLPDWLRQ RI WKH PRGHO SDUDPHWHUV UHODWHG WR ELRPDVV JURZWK G\QDPLFV RI VSHFLILF GHJUDGHUV DQG VXEVWUDWH GHJUDGDWLRQ NLQHWLFV LQ VRLO DQG DTXLIHU PDWHULDOV LV VRPHZKDW XQFHUWDLQ 0RQRGW\SH HTXDWLRQV DUH XVHG WR GHVFULEH WKH EHKDYLRU RI SXUH FXOWXUH V\VWHPV +RZHYHU WKHVH PRGHOV GLG QRW

PAGE 19

DGHTXDWHO\ GHVFULEH GHJUDGDWLRQ LQ PL[HG FXOWXUH ODERUDWRU\ V\VWHPV 6FRZ HW DO 6LPNLQV HW DO f 7KHUHIRUH WKHVH PRGHOV DUH QRW OLNHO\ WR SUHGLFW ILHOGVFDOH REVHUYDWLRQV %ODFNEXUQ f FODLPV WKDW ODERUDWRU\VFDOH SUHGLFWLRQV RI ILHOGVFDOH REVHUYDWLRQV DUH GHVWLQHG WR IDLO EHFDXVH RI WKH FRPSOH[LW\ RI WKH VSDWLDO VFDOHV RI LQWHUHVW IRU IXUWKHU GLVFXVVLRQ VHH 5DR HW DO Df %ODFNEXUQ f VXJJHVWHG WKDW WKH +HLVHQEHUJ 8QFHUWDLQW\ 3ULQFLSOH DSSOLHV WR PLFURELDO G\QDPLFV ZKLFK VWDWHV WKDW E\ VLPSO\ PDNLQJ DQ H[SHULPHQWDO REVHUYDWLRQ VLQFH PRVW H[SHULPHQWDO WHFKQLTXHV DUH LQYDVLYH WKRXJK LQ VRPH FDVHV QRQLQYDVLYH WHFKQLTXHV PD\ EH XVHGf WKH V\VWHP LV SHUWXUEHG DQG LV QR ORQJHU DQ DGHTXDWH UHSUHVHQWDWLRQ RI WKH RULJLQDO V\VWHP 'HVSLWH WKHVH DUJXPHQWV FRPSOH[ GHJUDGDWLRQ PRGHOV KDYH EHHQ GHYHORSHG WKDW LQFRUSRUDWH DYDLODELOLW\ RI HOHFWURQ DFFHSWRUV DQG HOHFWURQ GRQRUV QXWULHQWV DQG WKH R[\JHQ VWDWXV LQ DTXLIHUV :LGGRZVRQ HW DO 0DF4XDUULH DQG 6XGLFN\ f %HFDXVH RI WKH LQDELOLW\ WR GHVFULEH WKH SDUDPHWHUV DW WKH ILHOG VFDOH PDQ\ RI WKHVH PRGHOV DUH QRW YDOLGDWHG ([LVWLQJ FRXSOHG SURFHVV PRGHOV DUH KLJKO\ OLPLWHG E\ D ODFN RI H[SHULPHQWDO REVHUYDWLRQV ODERUDWRU\ DQG ILHOG VFDOHVf WKDW TXDQWLWDWLYHO\ GHPRQVWUDWH WKH HIIHFWV RI SURFHVV FRXSOLQJ VSHFLILFDOO\ WKH PDQLIHVWDWLRQ RI VXFK FRXSOLQJ RQ FRQWDPLQDQW PLJUDWLRQGHJUDGDWLRQ UDWHV DQG SURILOHV /DERUDWRU\ VWXGLHV FRXSOLQJ VRUSWLRQ GHJUDGDWLRQ DQG WUDQVSRUW DUH OLPLWHG WR +2&V PRVW DUH FRQGXFWHG LQ EDWFK UHDFWRUV 7KH VLPXOWDQHRXV VRUSWLRQ WUDQVIRUPDWLRQ DQG WUDQVSRUW RI 1+&V LQ G\QDPLF VRLO V\VWHPV KDV QRW EHHQ

PAGE 20

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f 0RVW RIWHQ WKH )UHXQGOLFK LVRWKHUP LV XVHG 6 .I&Q f ZKHUH 6 LV WKH VRUEHG FRQFHQWUDWLRQ [JJf .I )UHXQGOLFK VRUSWLRQ FRHIILFLHQW >P/Qf JO+9Q0J@ 4 HTXLOLEULXP VROXWLRQ FRQFHQWUDWLRQ MXJP/f DQG Q )UHXQGOLFK LVRWKHUP FRQVWDQW (TXLOLEULXP VRUSWLRQ PRGHOV DUH RIWHQ XVHG LQ VROXWH WUDQVSRUW PRGHOV +RZHYHU HTXLOLEULXP DVVXPSWLRQV DUH JHQHUDOO\ LQDGHTXDWH LQ GHVFULELQJ ORFDOVFDOH DQG ILHOGVFDOH VRUSWLRQ EHFDXVH QRQHTXLOLEULXP FRQGLWLRQV SUHGRPLQDWH 6RUSWLRQ QRQHTXLOLEULXP IRU +2&V FDQ EH GHVFULEHG XVLQJ WKH ELFRQWLQXXP PRGHO %UXVVHDX DQG 5DR Ef &RQFHSWXDOO\ WKH PRGHO

PAGE 21

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f :X DQG *VFKZHQG %DOO DQG 5REHUWV f DQG LQWUDRUJDQLF PDWWHU GLIIXVLRQ ,20'f %UXVVHDX HW DO f 5HJDUGOHVV RI WKH DFWXDO PHFKDQLVP UHVSRQVLEOH IRU UDWHOLPLWHG VRUSWLRQ FRQWDPLQDQWV DUH OLNHO\ WR UHVLGH ZLWKLQ WKH LQWHULRU UHJLRQV RI WKH VRUEHQW PDWUL[ 7KH FRQVHTXHQFHV RI WKLV RFFXUUHQFH RQ ELRGHJUDGDWLRQ ZLOO EH GLVFXVVHG LQ WKH QH[W VHFWLRQ 6RUSWLRQ RI 1+&V KDV EHHQ GHVFULEHG E\ WKH )UHXQGOLFK LVRWKHUP =DFKDUD HW DO $LQVZRUWK HW DO f /LQHDULW\ RI WKH VRUSWLRQ LVRWKHUPV YDULHG DSSURDFKLQJ D OLQHDU LVRWKHUP DW ORZ FRQFHQWUDWLRQV DQG VXUIDFH FRYHUDJHV $LQVZRUWK HW DO f 7KH SURWRQDWHG VSHFLHV LV WKH SUHGRPLQDQW IRUP RI 1+&V VRUEHG DQG LV H[SHFWHG WR VRUE SULPDULO\ RQWR FDWLRQ H[FKDQJH VLWHV 7KHVH VLWHV PD\ EH DVVRFLDWHG ZLWK SK\OORVLOLFDWH PLQHUDOV RU RUJDQLF PDWWHU ,Q HLWKHU FDVH VRUSWLRQ LV OLNHO\ WR EH UDWH OLPLWHG GXH WR PLJUDWLRQ LQWR FOD\ LQWHUOD\HUV DQG DJJUHJDWHV RU RUJDQLF PDWWHU PDWULFHV *LYHQ WKH FRPSOH[LW\ RI H[FKDQJH UHDFWLRQV LQYROYLQJ RUJDQLF FDWLRQV WKH

PAGE 22

ELFRQWLQXXP PRGHO PD\ QRW DGHTXDWHO\ GHVFULEH WKH EHKDYLRU RI 1+&V LQ VRLO PDWHULDOV 7KLV DVSHFW ZLOO EH H[SORUHG IXUWKHU LQ D ODWHU VHFWLRQ VHH &KDSWHU f %LRGHJUDGDWLRQ %LRDYDLODELOLWY %LRGHJUDGDWLRQ LV D GRPLQDQW PHFKDQLVP DIIHFWLQJ RUJDQLF FKHPLFDO WUDQVIRUPDWLRQV LQ VRLOV DQG DTXLIHUV 0LFURELDO GHJUDGDWLRQ RI PRVW VPDOO RUJDQLF FRPSRXQGV PROHFXODU PDVV f RFFXUV LQWUDFHOOXODUO\ %LWWRQ HW DO f 7KXV WKH UDWH RI ELRGHJUDGDWLRQ LV OLPLWHG E\ WKH G\QDPLFV RI f SK\VLFDOFKHPLFDO SURFHVVHV HJ VROXELOLW\ VRUSWLRQ K\GURG\QDPLF GLVSHUVLRQf WKDW OHDGV WR D ORZHULQJ RI VROXWH FRQFHQWUDWLRQ LQ WKH VROXWLRQ SKDVH f VRLO RU HQYLURQPHQWDO IDFWRUV WKDW OLPLW SK\VLRORJLFDO DFWLYLW\ RI WKH DSSURSULDWH PLFURELDO FRQVRUWLD f PLFURELDO IDFWRUV WKDW OLPLW VXEVWUDWH XSWDNH E\ WKH PLFURRUJDQLVPV HJ FHOO SHUPHDELOLW\ DQG K\GURSKRELFLW\f DQG f LQWUDFHOOXODU JHQHWLF RU ELRFKHPLFDO IDFWRUV HJ SUHVHQFH RI DSSURSULDWH HQ]\PH V\VWHPV SUHVHQFH DQG H[SUHVVLRQ RI JHQHVf WKDW OLPLWV XWLOL]DWLRQ RI WKH FRPSRXQG 7KH UHFDOFLWUDQFH RI GLIIHUHQW RUJDQLF FKHPLFDOV LQ D VSHFLILF VRLO RU WKH YDULDWLRQV LQ GHJUDGDWLRQ UDWHV RI D VSHFLILF FRPSRXQG LQ VHYHUDO VRLOV PD\ EH H[SODLQHG WR D ODUJH H[WHQW E\ XQGHUVWDQGLQJ WKHVH NH\ IDFWRUV ,QRFXODWLRQ RI VRLOV DQG DTXLIHUV ZLWK PLFURRUJDQLVPV FDSDEOH RI UHDGLO\ GHJUDGLQJ FKHPLFDOV PD\ UHVXOW LQ D SDUWLDO RU FRPSOHWH ODFN RI FRQWDPLQDQW UHPRYDO GXH WR YDULRXV HQYLURQPHQWDO VWUHVVHV QRW SUHVHQW XQGHU ODERUDWRU\ FRQGLWLRQV &RQWDPLQDQW SHUVLVWHQFH PD\ UHVXOW IURP WKH IROORZLQJ IDFWRUV

PAGE 23

0DGVHQ *ROGVWHLQ HW DO f f ORZ VXEVWUDWH FRQFHQWUDWLRQV QRW VXSSRUWLQJ PLFURELDO JURZWK f PLFURRUJDQLVPV HQFRXQWHULQJ WR[LQV RU SUHGDWRUV f PLFURRUJDQLVPV XVLQJ PRUH UHDGLO\ DYDLODEOH FDUERQ VRXUFHV DQG f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f $YDLODELOLW\ RI VOLJKWO\ VROXEOH VXEVWUDWHV PD\ EH FRQWUROOHG E\ WKH UDWH RI GLVVROXWLRQ 6WXFNO DQG $OH[DQGHU 0LOOHU DQG %DUWKD +XDQJ DQG &KRX f RU E\ ORZ DTXHRXV FRQFHQWUDWLRQV ZKLFK PD\ QRW LQGXFH WKH QHFHVVDU\ HQ]\PHV IRU ELRGHJUDGDWLRQ 0DGVHQ f 6LPLODUO\ VRUSWLRQ RI WKH VXEVWUDWH E\ VRLO PD\ UHGXFH VXEVWUDWH FRQFHQWUDWLRQV ,Q VROXWLRQ EHORZ OHYHOV QHFHVVDU\ IRU HQ]\PH ,QGXFWLRQ 6RUSWLRQ RI VXEVWUDWHV PLJKW DOVR HQKDQFH ELRGHJUDGDWLRQ UDWHV E\ GHFUHDVLQJ WKH VXEVWUDWH FRQFHQWUDWLRQ WR OHYHOV WKDW DUH QRW WR[LF WR PLFURRUJDQLVPV UHVSRQVLEOH IRU GHJUDGDWLRQ YDQ /RRVGUHFKW HW DO f 6RUSWLRQ PRUH OLNHO\ UHGXFHV RU LQKLELWV ELRGHJUDGDWLRQ UDWHV ,Q VRLOV 6WRW]N\

PAGE 24

DQG 5HP 0DGVHQ YDQ /RRVGUHFKW HW DO f )RU H[DPSOH VRUSWLRQ ZDV IRXQG WR GHFUHDVH WKH DPRXQW RI VXEVWUDWH DYDLODEOH WR PLFURRUJDQLVPV FDSDEOH RI GHJUDGLQJ VHYHUDO FRPSRXQGV LQFOXGLQJ GLTXDW :HEHU DQG &REOH f EHQ]\ODPLQH 6XEED5DR DQG $OH[DQGHU 0LOOHU DQG $OH[DQGHU f DON\ODPLQHV :V]ROHN DQG $OH[DQGHU f JOXFRVH *RUGRQ DQG 0LOOHUR f 'LFKORURSKHQR[\DFHWLF DFLG 2JUDP HW DO f DPLQR DFLGV 'DVKPDQ DQG 6WRW]N\ f WROXHQH 5RELQVRQ HW DO f EHQ]LGLQH :HEHU f TXLQROLQH 6PLWK HW DO f DQG IOXPHWVXODP /HKPDQ HW DO f 'HJUDGDWLRQ ZDV DGHTXDWHO\ GHVFULEHG E\ D VHFRQG RUGHU UDWH HTXDWLRQ ZLWK WKH DVVXPSWLRQ WKDW RQO\ VROXWLRQSKDVH FKORUSURKDP DQG GLEXW\O SKWKDODWH DUH ELRGHJUDGHG LQ WKH SUHVHQFH RI VHGLPHQWV 6WHHQ HW DO f %LRGHJUDGDWLRQ RI FRQWDPLQDQWV PD\ EH OLPLWHG ZKHQ FRQWDPLQDQWV DUH VHTXHVWHUHG ZLWKLQ WKH RUJDQLF RU LQRUJDQLF FRPSRQHQWV RI WKH VRUEHQW PDWUL[ WKDW DUH QRW GLUHFWO\ DFFHVVLEOH WR PLFURRUJDQLVPV %LRGHJUDGDWLRQ PD\ DOVR EH OLPLWHG E\ PDVV WUDQVIHU ,3' DQG ,20'f IURP WKH LQWHULRU RI WKH VRUEHQW WR WKH H[WHULRU VROXWLRQ %LRDYDLODELOLW\ LV OLPLWHG LQ WKHVH H[DPSOHV EHFDXVH LQWUDn DJJUHJDWH SRUHV DUH WRR VPDOO WR EH DFFHVVLEOH WR EDFWHULD 6WHLQEHUJ HW DO 6FRZ DQG $OH[DQGHU f 7KH VXEVWUDWH VRUEHG ZLWKLQ RUJDQLF PDWWHU LV DFFHVVLEOH RQO\ DIWHU GHVRUSWLRQ RU GLIIXVLRQ RXW RI WKH VRUEHQW PDWUL[ 0DVV WUDQVIHU FRQVWUDLQWV KDYH EHHQ VKRZQ IRU VRUSWLRQGHVRUSWLRQ RI K\GURSKRELF RUJDQLF FRPSRXQGV +2&Vf LQ VRLOV DQG VHGLPHQWV :X DQG *VFKZHQG

PAGE 25

%UXVVHDX DQG 5DR E %UXVVHDX HW D f IRU ELRGHJUDGDWLRQ RI +2&V 5LMQDDUWV HW DO 5RELQVRQ HW DO f DQG IRU GHQLWULILFDWLRQ 0\UROG DQG 7LHGMH f )RU QDSKWKDOHQH ZKLFK H[KLELWV UHYHUVLEOH VRUSWLRQGHVRUSWLRQ 0LKHOFLF DQG /XWK\ DEf ELRGHJUDGDWLRQ ZDV QRW GHSHQGHQW XSRQ GHVRUSWLRQ NLQHWLFV IURP ILQHVL]HG PDWHULDO 0LKHOFLF f )RU ODUJHU SDUWLFOHV ELRGHJUDGDWLRQ RI QDSKWKDOHQH ZDV GHSHQGHQW XSRQ LQWUDSDUWLFOH GLIIXVLRQ IURP WKH VROLGSKDVH WR WKH VROXWLRQSKDVH ZKLFK VXJJHVWV PDVV WUDQVIHU FRQVWUDLQWV RU UHGXFHG ELRDYDLODELOLW\ RI WKH VRUEHG QDSKWKDOHQH 0LKHOFLF DQG /XWK\ Ff )RU TXLQROLQH KLJKO\ VHOHFWLYH FDWLRQ H[FKDQJH UHDFWLRQV PD\ FRQWURO PDVV WUDQVIHU IURP WKH VRLO WR VROXWLRQ WKHUHE\ OLPLWLQJ ELRGHJUDGDWLRQ 6PLWK HW DO f VXJJHVWHG WKDW ELRGHJUDGDWLRQ RI TXLQROLQH LQ GLVSHUVHG FOD\ VXVSHQVLRQV LV OLPLWHG E\ GHVRUSWLRQ RI WKH KLJKO\ VWDEOH TXLQROLQLXP LRQ VXUIDFH FRPSOH[ +RZHYHU LW LV QRW NQRZQ LI WKHVH VDPH UDWHOLPLWLQJ VWHSV FRQWURO ELRGHJUDGDWLRQ UDWHV LQ VRLOV DQG VHGLPHQWV RU LI GLIIXVLRQOLPLWHG PDVV WUDQVIHU FRQVWUDLQWV ,20' ,3'f DUH RSHUDWLYH )RU WKLV UHDVRQ PHFKDQLVWLF PRGHOV FRXSOLQJ WKH VRUSWLRQ GHJUDGDWLRQ DQG WUDQVSRUW LQ VRLO DQG DTXLIHU V\VWHPV DUH QHHGHG WR XQGHUVWDQG WKH UDWHOLPLWLQJ VWHSV RI RUJDQLF FKHPLFDO ELRGHJUDGDWLRQ (IIHFWV RI 6XUIDFHV RQ %LRGHJUDGDWLRQ $W WKH FHOOXODUVFDOH WKH LQIOXHQFHV RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ KDYH EHHQ PRQLWRUHG LQGLUHFWO\ LQ D YDULHW\ RI GLVFLSOLQHV 5HSRUWHG REVHUYDWLRQV

PAGE 26

VXJJHVWLQJ WKH LQIOXHQFH RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ KDYH EHHQ GLVPLVVHG EHFDXVH RI SRVVLEOH VHFRQGDU\ UHVSRQVHV RFFXUULQJ DW WKH VXUIDFHV YDQ /RRVGUHFKW HW DO f 2JUDP HW DO f GHPRQVWUDWHG WKDW VRUEHG GLFKORURSKHQR[\ DFHWLF DFLG 'f ZDV SURWHFWHG IURP ELRGHJUDGDWLRQ DQG WKDW RQO\ WKH VROXWLRQSKDVH ZDV GHJUDGHG E\ IUHH DQG DWWDFKHG EDFWHULD 7KH GHJUDGDWLYH DFWLYLW\ RI IUHH DQG DWWDFKHG EDFWHULD KRZHYHU FRXOG QRW EH GLIIHUHQWLDWHG ,Q D VLPLODU VWXG\ ZDV VXJJHVWHG WR EH GHJUDGHG E\ EDFWHULD LQ WKH VRUEHG DQG VROXWLRQ SKDVH =RX HW DO f KRZHYHU GHJUDGDWLRQ UDWHV ZHUH WKRXJKW WR EH IDVWHU E\ IUHH EDFWHULD UDWKHU WKDQ VRUEHGSKDVH EDFWHULD $DPDQG HW DO f DOVR VXJJHVWHG WKDW RQO\ EDFWHULD LQ WKH VROXWLRQ SKDVH ZHUH GHJUDGLQJ WKH DTXLIHU FRQWDPLQDQWV 0RUH UHFHQWO\ *XHULQ DQG %R\G f DUJXHG WKDW D EDFWHULDO LVRODWH 3 SXWLGD f ZDV FDSDEOH RI XWLOL]LQJ VRUEHG QDSKWKDOHQH IURP WKH VXUIDFH FRQWUDU\ WR WKH SDUDGLJP WKDW GHJUDGDWLRQ RFFXUV LQWUDFHOOXODUO\ $QRWKHU EDFWHULDO LVRODWH 13$ONf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

PAGE 27

QXWULHQW DQG HOHFWURQ DFFHSWRU FRQFHQWUDWLRQ DQG EDFWHULDO SRSXODWLRQf LQ FRPELQDWLRQ ZLWK IDFWRUV GLVFXVVHG DERYH %LRPDVV 'LVWULEXWLRQ 0LFURELDO ELRPDVV LV VXEMHFW WR VRUSWLRQ DQG WUDQVSRUW SURFHVVHV 7KHUHIRUH EDFWHULD PD\ H[LVW LQ WKH VRLO HLWKHU VRUEHG DWWDFKHGf RU LQ VROXWLRQ IUHHf 3K\VLFDO FKHPLFDO DQG PLFURELDO IDFWRUV FRQWUROOLQJ WKH GLVWULEXWLRQ RI EDFWHULD LQ SRURXV PHGLD KDYH UHFHQWO\ EHHQ VXPPDUL]HG E\ +DUYH\ f /LQGTYLVW DQG (QILHOG Ef DQG 7DQ HW DO f %DFWHULD JURZ DIWHU WKH\ DWWDFK WR VXUIDFHV LI HVVHQWLDO FDUERQ DQG HQHUJ\ VRXUFHV DUH DYDLODEOH *URZWK DQG GHYHORSPHQW RI EDFWHULDO FRORQLHV JHQHUDOO\ LV IROORZHG E\ WKH SURGXFWLRQ RI H[WUDFHOOXODU SRO\VDFFKDULGHV DQG SURPRWH WKH IRUPDWLRQ RI EDFWHULDO ELRILOPV YDQ /RRVGUHFKW HW DO )OHWFKHU f 8QGHU QXWULHQW DQG VXEVWUDWHULFK FRQGLWLRQV DV PD\ EH WKH FDVH QHDU ZDVWH GLVSRVDO VLWHV ELRILOPV PD\ EH IRUPHG 0DWKHPDWLFDO PRGHOV IRU ELRGHJUDGDWLRQ DUH GHYHORSHG DVVXPLQJ WKDW WKH PLFURELDO ELRPDVV PD\ EH GLVWULEXWHG LQ ELRILOPV PLFURFRORQLHV RU XQLIRUPO\ WKURXJKRXW WKH SRURXV PHGLXP %DYH\H DQG 9DORFFKL f 7KH DVVXPSWLRQ RI PLFURELDO ELRILOPV VXJJHVWV WKDW VXUIDFHV DUH XQLIRUPO\ FRDWHG E\ ELRILOPV LQ ZKLFK WKH GHJUDGDWLRQ RI WKH FRQWDPLQDQW DQG WKH XWLOL]DWLRQ RI WKH HOHFWURQ DFFHSWRU WDNHV SODFH 5LWWPDQ DQG 0F&DUW\ f 7KH PLFURFRORQ\ DSSURDFK VXJJHVWV WKDW EDFWHULD H[LVW LQ GLVFUHWH PLFURFRORQLHV DQG WKDW JURZWK DQG VXEVWUDWH XWLOL]DWLRQ UDWHV FRUUHVSRQG WR WKH PLFURELDO SRSXODWLRQ 0RO] HW DO

PAGE 28

0DUVKDOO f 5HFHQW PLFURVFRSLF HYLGHQFH VXJJHVWV WKDW EDFWHULD H[LVW LQ PLFURFRORQLHV ZLWK EDFWHULDO FHOOV H[WHQGLQJ RXW LQWR WKH VRLO SRUH VSDFHV 9DQGHYLYHUH DQG %DYH\H f 7KH GLIILFXOW\ LQ PDWKHPDWLFDOO\ GHVFULELQJ WKH GLPHQVLRQV RI WKH ELRILOPV DQG PLFURFRORQLHV OLPLWV WKH XWLOL]DWLRQ RI WKHVH PRGHOV LQ VRLOV DQG DTXLIHUV 7KH XQLIRUP PLFURELDO GHVFULSWLRQ FRPPRQO\ XVHG LQ VROXWH WUDQVSRUW PRGHOV PDNHV QR DVVXPSWLRQV DERXW WKH GLVWULEXWLRQ RI EDFWHULD HJ GLVFUHWH FRORQLHV RU ELRILOPVf LQ VROXWLRQ RU RQ WKH VXUIDFHV &RUDSLFRJOX DQG +DULGDV .LQGUHG DQG &HOLD f 7KLV FRQFHSW VXJJHVWV WKDW RYHUDOO JURZWK DQG PHWDEROLVP DUH QRW LQIOXHQFHG E\ WKH PLFURELDO GLVWULEXWLRQ %LRPDVV ,PSDFWV RQ &RQWDPLQDQW 6RUSWLRQ DQG 7UDQVSRUW *URZWK RU DGGLWLRQ RI EDFWHULD PD\ GUDVWLFDOO\ DOWHU WKH FKHPLFDO SK\VLFDO DQG PLFURELRORJLFDO HQYLURQPHQW RI VRLO VXUIDFHV )OHWFKHU f &KHPLFDO SURSHUWLHV RI VRLO VXUIDFHV PD\ EH DOWHUHG E\ EDFWHULDO ELRPDVV WKHUHE\ LQIOXHQFLQJ FRQWDPLQDQW WUDQVSRUW 6WXFNL HW DO YDQ /RRVGUHFKW HW DO 6WRW]N\ f 3K\VLFDO DOWHUDWLRQV LQFOXGLQJ EORFNDJH RI SRUHV E\ EDFWHULDO ELRPDVV DQG EORFNDJH RI VRUSWLYH UHJLRQV LQ WKH VRLO PD\ RFFXU DOWHULQJ ZDWHU IORZ DQG VRUSWLRQ FRQWDPLQDQWV 7DQ HW DO 9DQGHYLYHUH DQG %DYH\H f %DFWHULDO WUDQVSRUW HJ VROXWLRQ SKDVH EDFWHULDf DQG WKHLU IDFLOLWDWLRQ RI FRQWDPLQDQW PLJUDWLRQ ZDV UHFHQWO\ GHPRQVWUDWHG /LQGTYLVW DQG (QILHOG Df 7KH LPSDFW RI EDFWHULDO ELRPDVV LV EHFRPLQJ UHFRJQL]HG DV DQ LPSRUWDQW SURFHVV LQIOXHQFLQJ FRQWDPLQDQW VRUSWLRQ DQG WUDQVSRUW 5DR HW DO

PAGE 29

Ef 7KHUHIRUH WKH LPSDFW RI EDFWHULDO ELRPDVV QHDU KD]DUGRXV ZDVWH VLWHV LV RI LQWHUHVW (QYLURQPHQWDO )DFWRUV ,QIOXHQFLQJ %LRGHJUDGDWLRQ (QYLURQPHQWDO YDULDEOHV PD\ EH VLJQLILFDQW LQ VXUIDFH VRLOV ZKHUH PLFURELDO FRPPXQLWLHV DUH LQ GLUHFW FRQWDFW ZLWK WKH VRLO DWPRVSKHUH 6HDVRQDO F\FOHV LQ WHPSHUDWXUH DQG VRLOZDWHU FRQWHQW GLVWLQJXLVK WKLV ]RQH IURP DTXLIHU V\VWHPV WKDW PD\ H[KLELW PRUH FRQVWDQW FRQGLWLRQV *URXQGZDWHU WHPSHUDWXUHV DUH UHODWLYHO\ FRQVWDQW KRZHYHU WHPSHUDWXUHV PD\ EH DV ORZ DV WR r& ZKLFK PD\ UHGXFH PLFURELDO DFWLYLW\ 6XUIDFH IOXFWXDWLRQV LQ WHPSHUDWH UHJLRQV PD\ UHGXFH EDFWHULDO DFWLYLW\ WKURXJKRXW WKH ZLQWHU PRQWKV ,Q FRQWUDVW EDFWHULDO DFWLYLW\ ZLOO OLNHO\ EH KLJK LQ ZDUPHU WURSLFDO HQYLURQPHQWV 9DULDWLRQV LQ WHPSHUDWXUH RYHU WKH XVXDO UDQJH RI LQWHUHVW r&f DUH QRW OLNHO\ WR LQIOXHQFH WKH GHJUDGDWLRQ SDWKZD\ RQO\ WKH UDWH RI PLFURELDO GHJUDGDWLRQ DQG WKH PLFURELDO GHQVLW\ &KDQJHV LQ VRLOZDWHU FRQWHQW RQ WKH RWKHU KDQG PD\ LQIOXHQFH PLFURELDO FRPPXQLWLHV DQG WKHLU DFWLYLW\ 4XDQWLWDWLYH DQG TXDOLWDWLYH GLIIHUHQFHV UHVXOW ZKHQ REVHUYLQJ DHURELF DQG DQDHURELF GHJUDGDWLRQ 'HHS VDWXUDWHG DTXLIHUV PD\ EH GHSOHWHG LQ R[\JHQ DQG EDFWHULDO SRSXODWLRQV PD\ EH OLPLWHG E\ WKH DYDLODELOLW\ RI DOWHUQDWH HOHFWURQ DFFHSWRUV 1 6 &f ,Q R[\JHQ GHSOHWHG ]RQHV IHUPHQWDWLRQ UHVXOWV LQ LQFRPSOHWH GHJUDGDWLRQ RI FRQWDPLQDQWV )ORZ KHWHURJHQHLWLHV PD\ FUHDWH ]RQHV RI PL[LQJ WKXV VXSSO\LQJ DGHTXDWH QXWULHQWV DQG FRIDFWRUV WR VWLPXODWH D GLYHUVH DQG QXPHURXV JURXS RI PLFURRUJDQLVPV 2Q WKH RWKHU KDQG D

PAGE 30

FRQWDPLQDWHG DUHD FDQ WXUQ DQ R[\JHQDWHG DTXLIHU LQWR DQ DQR[LF UHJLRQ LI WKH KHWHURWURSKLF UHVSLUDWLRQ H[FHHGV R[\JHQ LQSXW RU UHFKDUJH ,Q ZHOOGUDLQHG VRLOV DQG VKDOORZ DTXLIHUV PLFURELDO SRSXODWLRQV DUH SUHGRPLQDQWO\ DHURELF XWLOL]LQJ JDVHRXV RU GLVVROYHG R[\JHQ DV DQ HOHFWURQ DFFHSWRU ZKLFK ZRXOG GHJUDGH RUJDQLF FRQWDPLQDQWV WR PHWDEROLWHV DQG XOWLPDWHO\ PLQHUDOL]HG WR & + DQG RWKHU HOHPHQWV (YHQ LQ D ZHOOGUDLQHG VRLO KRZHYHU DQDHURELF UHJLRQV HJ PLFURVLWHVf PD\ GHYHORS DV R[\JHQ LV GHSOHWHG SRWHQWLDOO\ DOWHULQJ WKH HQG SURGXFWV RI PHWDEROLVP %LRGHJUDGDWLRQ 0RGHOV 6SHFLILF JURZWK UDWHV RI PLFURELDO SRSXODWLRQV KDYH EHHQ UHSUHVHQWHG E\ D YDULHW\ RI PDWKHPDWLFDO PRGHOV 3LUW $OH[DQGHU DQG 6FRZ %D]LQ DQG 0HQHOO f 7KH HPSLULFDO SRZHU UDWH PRGHO rE& f DW ZKHUH NE LV WKH ELRGHJUDGDWLRQ UDWH FRQVWDQW 7f VLPSOLILHV WR D ILUVWRUGHU NLQHWLFV PRGHO ZKHQ Q +DPDNHU f &RQFHUQ RYHU WKH XVH RI WKLV PRGHO LV H[SUHVVHG DV LW LV RIWHQ SUHVHQWHG ZLWK QR WKHRUHWLFDO MXVWLILFDWLRQ IRU LWV XVH %D]LQ HW DO f 7KH GHVFULSWLRQ RI WKH PLFURELDO JURZWK UDWH ZKHQ LW LV UHVWULFWHG E\ WKH FRQFHQWUDWLRQ RI D JURZWKOLPLWLQJ VXEVWUDWH LV JLYHQ E\ WKH 0RQRG HTXDWLRQ ZKLFK ZDV GHYHORSHG IURP HQ]\PH NLQHWLFV

PAGE 31

U L 0 f 0PD[K" .V 6 f ZKHUH P LV WKH VSHFLILF JURZWK UDWH RI WKH ELRPDVV 7f [PD[ LV WKH PD[LPXP VSHFLILF JURZWK UDWH 7f 6 LV WKH VXEVWUDWH FRQFHQWUDWLRQ 0/f DQG .V LV WKH VXEVWUDWH KDOI VDWXUDWLRQ FRQVWDQW 0/f 7KLV HTXDWLRQ LV FRPPRQO\ XVHG WR GHVFULEH WKH EDFWHULDO JURZWK XSRQ FRQWDPLQDQW GHJUDGDWLRQ 2IWHQ RUJDQLF FRQWDPLQDQW GHJUDGDWLRQ LV OLPLWHG E\ DYDLODELOLW\ RI DQ HOHFWURQ DFFHSWRU RU DQ DGGLWLRQDO FDUERQ VXEVWUDWH 7KH PRGLILHG 0RQRG HTXDWLRQ FRXSOHV WKH GHSHQGHQFH RI EDFWHULDO JURZWK RQ DQRWKHU FDUERQ VXEVWUDWH RU HOHFWURQ DFFHSWRU U U 2 A f 0PD[ >f§ G >f§ f .V 6n .R 2 ZKHUH 2 LV WKH R[\JHQ FRQFHQWUDWLRQ 0/f DQG .4 LV WKH R[\JHQ KDOI VDWXUDWLRQ FRQVWDQW 0/f (TXDWLRQV PD\ DOVR LQFRUSRUDWH DQ LQKLELWLRQ FRHIILFLHQW WR DFFRXQW IRU JURZWK UDWH OLPLWDWLRQV GXH WR D WR[LF IHHGEDFN PHFKDQLVP +DUYH\ DQG :LGGRZVRQ f ,Q RUGHU WR DGHTXDWHO\ GHVFULEH FRQWDPLQDQW EHKDYLRU DOO SDUDPHWHUV QHFHVVDU\ IRU WKHVH PRGHOV PXVW EH PHDVXUHG DW WKH SDUWLFXODU VFDOH RI LQWHUHVW 7UDQVSRUW 7KH JRYHUQLQJ GLIIHUHQWLDO HTXDWLRQ WKDW VHUYHV DV WKH EDVLV IRU PRVW FRXSOHGSURFHVV PRGHOV XVHG LQ VRLOV DQG DTXLIHUV LV

PAGE 32

>Y f RH YT >Y f TT s! f GL DW ZKHUH & VROXWLRQSKDVH FRQFHQWUDWLRQ 0/f 6 VRUEHGSKDVH FRQFHQWUDWLRQ 00f W WLPH 7f S VRLO EXON GHQVLW\ 0/f IUDFWLRQDO YROXPHWULF ZDWHU FRQWHQW GLPHQVLRQOHVVf K\GURG\QDPLF GLVSHUVLRQ FRHIILFLHQW /7f [ GLVWDQFH /f T 'DUF\ IOX[ IRU ZDWHU IORZ /7f DQG c UDWHV 0/f RI ORVV RU JDLQ YLD YDULRXV VLQNV DQG VRXUFHV ,Q (T f PXOWLGLPHQVLRQDO DGYHFWLYHGLVSHUVLYH VROXWH WUDQVSRUW LQ D KHWHURJHQHRXV SRURXV PHGLXP XQGHU WUDQVLHQW ZDWHU IORZ FRQGLWLRQV ILUVW WZR WHUPV RQ WKH UKVf LV FRXSOHG WR VRUSWLRQ G\QDPLFV WKLUG WHUP RQ UKVf DQG ELRGHJUDGDWLRQ NLQHWLFV ODVW WHUP RQ UKVf 'LIIHUHQFHV LQ SXEOLVKHG PRGHOV DULVH IURP WKH VSHFLILF PDQQHU LQ ZKLFK VRUSWLRQ DQG GHJUDGDWLRQ NLQHWLFV DUH PRGHOHG ZKHWKHU WUDQVLHQW RU VWHDG\ IORZ LV FRQVLGHUHG DQG LI RQH RU PXOWLGLPHQVLRQDO WUDQVSRUW LV RI LQWHUHVW )RU RQHGLPHQVLRQDO VWHDG\ VDWXUDWHG ZDWHU IORZ FRQGLWLRQV LQ D KRPRJHQHRXV PHGLXP HT f FDQ EH UHVWDWHG DV  Y GW [ G[ 4 GW A f ZKHUH Y Tf LV WKH DYHUDJH SRUHZDWHU YHORFLW\ /7f $VVXPLQJ WKDW VRUSWLRQ FDQ EH UHSUHVHQWHG E\ WKH ELFRQWLQXXP VRUSWLRQ PRGHO ZLWK D )UHXQGOLFK LVRWKHUP DQG WKDW ILUVWRUGHU ELRGHJUDGDWLRQ NLQHWLFV DSSO\ WR ELRGHJUDGDWLRQ NE&f HT f LV UHVWDWHG DV IROORZV

PAGE 33

ZKHUH NE UHSUHVHQWV WKH SVHXGR ILUVWRUGHU UDWH FRQVWDQW 7f IRU ELRGHJUDGDWLRQ DVVXPHG WR RFFXU RQO\ LQ WKH VROXWLRQ SKDVHf .I LV WKH )UHXQGOLFK VRUSWLRQ FRHIILFLHQW PO-Qf DQG Q LV WKH )UHXQGOLFK VRUSWLRQ LVRWKHUP FRHIILFLHQW 1RWH WKDW WKH )UHXQGOLFK PRGHO HT f LV XVHG WR UHSUHVHQW HTXLOLEULXP VRUSWLRQ LVRWKHUPV 7KXV LVRWKHUP QRQOLQHDULW\ PD\ EH DFFRXQWHG IRU ZLWK WKLV PRGHO ZKLFK UHVXOWV LQ QRQOLQHDU PDVV WUDQVIHU DQG PL[HG RUGHU Qf HTXDWLRQV 7KH PRGHO PD\ EH ZULWWHQ LQ QRQGLPHQVLRQDO IRUP 1NHGL .L]]D HW DO f f§ "IL8Qf&rQf f§ Df Sf5"r/ R &rQf6rf GW Ef E\ GHILQLQJ WKH IROORZLQJ GLPHQVLRQOHVV SDUDPHWHUV &r && S YW/ ; [/ \ NY/ 6r >6 )f.I&A Q!f @ 5 > Sf .&Qff@ LV WKH UHWDUGDWLRQ IDFWRU ZKLFK UHSUHVHQWV HTXLOLEULXP VRUSWLRQ 3 Y/' LV WKH 3HFOHW QXPEHU ZKLFK UHSUHVHQWV WKH K\GURG\QDPLF GLVSHUVLRQ LQ WKH FROXPQ c ^> )SHf.&Q!@5` UHSUHVHQWV WKH IUDFWLRQ RI LQVWDQWDQHRXV

PAGE 34

UHWDUGDWLRQ R ^>Nf5/@Y` LV WKH 'DPNRKOHU QXPEHU ZKLFK LV SURSRUWLRQDO WR WKH UDWLR RI K\GURG\QDPLF UHVLGHQFH WLPH /9f WR WKH UHDFWLRQ WLPH Nf / LV WKH OHQJWK RI WKH FROXPQ /f ) LV WKH IUDFWLRQ RI VRUSWLRQ LQ WKH LQVWDQWDQHRXV UHJLRQV N LV WKH ILUVWRUGHU UDWH FRHIILFLHQW 7f $W WKH ILHOG VFDOH KHWHURJHQHRXV IORZ ILHOGV DUH RIWHQ DVVXPHG WR EH UHSUHVHQWHG DV EHLQJ PDFURVFRSLFDOO\ KRPRJHQHRXV 0DF4XDUULH DQG 6XGLFN\ f 7KH HIIHFWV RI ORFDOVFDOH SRUHYHORFLW\ YDULDWLRQV DUH UHSUHVHQWHG E\ D PDFURGLVSHUVLRQ WHUP IRU WKH ZKROH IORZ ILHOG 0DF4XDUULH DQG 6XGLFN\ f VKRZHG WKDW VXFK DQ DSSURDFK FDQ OHDG WR D VHULRXV RYHUHVWLPDWLRQ RI VXEVWUDWH GHJUDGDWLRQ UDWH DV D UHVXOW RI IDU JUHDWHU PL[LQJ RI WKH VXEVWUDWH DQG GLVVROYHG R[\JHQ SOXPHV SUHGLFWHG WR RFFXU DW WKH ORFDO VFDOHV ZKHQ D PDFURn GLVSHUVLRQ FRQFHSW LV HPSOR\HG 7KLV LV D FOHDU GHPRQVWUDWLRQ RI WKH LPSRUWDQFH RI DSSURSULDWHO\ XQGHUVWDQGLQJ ORFDOVFDOH SK\VLFDO KHWHURJHQHLW\ LQ H[SODLQLQJ DQG SUHGLFWLQJ PDFURVFDOH REVHUYDWLRQV RI ELRGHJUDGDWLRQ 6LPLODUO\ KHWHURJHQHLWLHV LQ WKH IORZ ILHOGV PD\ FUHDWH PL[LQJ ]RQHV ZKHUH KLJK FRQFHQWUDWLRQV RI HOHFWURQ GRQRUV LH RUJDQLF DFLGV SURGXFHG E\ IHUPHQWDWLRQ SURFHVVHV DFWLYH LQ R[\JHQ OLPLWHG UHJLRQVf DQG DFFHSWRUV LH R[\JHQf FUHDWH KLJK PLFURELDO SRSXODWLRQV DQG GHJUDGDWLRQ FDSDFLWLHV 5HVHDUFK 2EMHFWLYHV 2YHU WKH SDVW WZR GHFDGHV VWXG\LQJ HDFK IDFWRU WKDW LQIOXHQFHV WKH HQYLURQPHQWDO EHKDYLRU RI RUJDQLF FKHPLFDOV LQ LVRODWLRQ KDV UHVXOWHG LQ WKH DFFXPXODWLRQ RI DQ H[WHQVLYH GDWDEDVH RQ VHYHUDO NH\ SURFHVVHV $V 5DR HW DO Df SRLQWHG RXW

PAGE 35

+DYLQJ PDGH LPSUHVVLYH DGYDQFHV LQ RXU XQGHUVWDQGLQJ RI WKH NH\ SURFHVVHV WUDQVSRUW WUDQVIRUPDWLRQV DQG VRUSWLRQf LW LV QRZ LPSRUWDQW WR H[DPLQH WKH OLQNDJHV EHWZHHQ WKHVH SURFHVVHV &RXSOHGSURFHVVHV PRGHOV SURYLGH WKH VWLPXOXV IRU D SDUDGLJP VKLIWIURP WKH UHGXFWLRQLVW DSSURDFKHV WR WKH UHODWLRQDO DSSURDFKHVZKHUH DQ LQYHVWLJDWLRQ RI WKH LQWHUUHODWLRQV DPRQJ WKH SURFHVVHV LV FRQVLGHUHG HYHQ PRUH LPSRUWDQW WKDQ WKH H[DPLQDWLRQ RI LQGLYLGXDO SURFHVVHV WKHPVHOYHV f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f 6ROXWHVRUEHQW :KDW VRUSWLRQ SURFHVVHV OLPLW ELRDYDLODELOLW\ RI 1+&V LQ UHPHGLDWLRQ SUDFWLFHV" ,V WKH QRQHTXLOLEULXP VRUSWLRQ RI 1+&V DFFXUDWHO\ GHVFULEHG E\ WKH ELFRQWLQXXP PRGHO" f 0LFURRUJDQLVPVRUEHQWVROXWH 'R ELRUHPHGLDWLRQ SUDFWLFHV LQIOXHQFH 1+& VRUSWLRQ DQG WUDQVSRUW" f 6ROXWHPLFURRUJDQLVP :KDW HVVHQWLDO QXWULHQW DQG R[\JHQ FRQWHQWV DUH UHTXLUHG IRU ELRGHJUDGDWLRQ" f 0LFURRUJDQLVPVRUEHQW ,V EDFWHULDO DFWLYLW\ LH ELRGHJUDGDWLRQf DOWHUHG LQ WKH SUHVHQFH RI VXUIDFHV"

PAGE 36

7KH IROORZLQJ FKDSWHUV DGGUHVV WKH TXHVWLRQV VWDWHG DERYH E\ VWXG\LQJ TXLQROLQH VRUSWLRQ DQG GHJUDGDWLRQ 4XLQROLQH D 1+& LV D FRQWDPLQDQW IRXQG LQ HQHUJ\GHULYHG ZDVWH PDWHULDOV DQG SURGXFWV DQG KDV WKH SRWHQWLDO WR EH WUDQVSRUWHG WR WKH VXEVXUIDFH VRLO DQG JURXQGZDWHU =DFKDUD HW DO f 4XLQROLQH VRUSWLRQ KDV EHHQ FKDUDFWHUL]HG LQ EDWFK V\VWHPV XVLQJ FOD\ PLQHUDOV DQG VRLOV 'HVRUSWLRQ ZDV UHFHQWO\ VKRZQ WR OLPLW ELRGHJUDGDWLRQ RI TXLQROLQH WR LWV SULPDU\ PHWDEROLWH K\GUR[\TXLQROLQHf LQ EDWFK V\VWHPV 6PLWK HW DO f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f ZDV XVHG WR DVVHVV WKH EHKDYLRU RI 1+&V 7KLV LQIRUPDWLRQ ZDV WKHQ XVHG WR GHWHUPLQH WKH UDWHOLPLWLQJ SURFHVVHV FRQWUROOLQJ ELRUHPHGLDWLRQ SUDFWLFHV RI 1+&V 7KH LPSDFW RI ELRPDVV RQ WKH VRUSWLRQ DQG WUDQVSRUW RI WKUHH VROXWHV QDSKWKDOHQH &D TXLQROLQHf LQ D VXEVXUIDFH VRLO DUH LQYHVWLJDWHG LQ &KDSWHU 7KHVH FRPSRXQGV ZHUH VHOHFWHG EHFDXVH RI WKHLU NQRZQ LQWHUDFWLRQV LQ VRLO LH FDWLRQ H[FKDQJH RU K\GURSKRELF SDUWLWLRQLQJf 0LVFLEOH GLVSODFHPHQW WHFKQLTXHV ZHUH XVHG WR PHDVXUH VRUSWLRQ DQG WUDQVSRUW RI WKH DERYH

PAGE 37

FRPSRXQGV GXULQJ VWHDG\ VDWXUDWHG ZDWHU IORZ FRQGLWLRQV WKURXJK KRPRJHQHRXVO\ SDFNHG VWHULOH RU EDFWHULDOLQRFXODWHG VRLO FROXPQV 3UHn LQRFXODWLRQ RI WKH 1RUERUQH VRLO ZLWK EDFWHULD FIXJf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

PAGE 38

&+$37(5 &+(02'<1$0,&6 2) 1+(7(52&<&/,& &203281'6 ,1 $%,27,& 6<67(06 %$7&+ $1' )/2:7+528*+ 7(&+1,48(6 ,QWURGXFWLRQ 6RUSWLRQ RI 1+&V PD\ RFFXU YLD FDWLRQ H[FKDQJH RI WKH SURWRQDWHG VSHFLHV RQ FOD\ PLQHUDOV RU LQ RUJDQLF PDWWHU DQGRU YLD SDUWLWLRQLQJ RI WKH QHXWUDO VSHFLHV LQWR RUJDQLF PDWWHU ,Q FRQWUDVW VRUSWLRQ RI +2&V RFFXUV SULPDULO\ YLD fSDUWLWLRQLQJ LQWR WKH RUJDQLF SKDVH 7KH G\QDPLFV RI +2& VRUSWLRQ KDYH EHHQ FRQFHSWXDOL]HG DQG GHVFULEHG E\ WKH ELFRQWLQXXP VRUSWLRQ PRGHO .DULFNKRII %UXVVHDX HW DO %DOO DQG 5REHUWV f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f LQ ZKLFK

PAGE 39

GLIIXVLRQDO FRQVWUDLQWV ZLWKLQ WKH PDWUL[ ,20'f FDXVH VRUSWLRQ QRQHTXLOLEULXP RI +2&V 1RQHTXLOLEULXP PD\ DOVR UHVXOW IURP ,3' LQWUDSDUWLFOH GLIIXVLRQf LQVLGH PLFURSRURXV SDUWLFOHV ZKLFK FRQWDLQ RUJDQLF FRDWLQJV +2&V DUH QRW OLNHO\ WR H[KLELW FKHPLFDO QRQHTXLOLEULXP EHFDXVH VRUSWLRQ RFFXUV YLD SDUWLWLRQLQJ .DULFNKRII HW DO &KLRX HW DO f 6RUSWLRQ RI LQRUJDQLF FDWLRQV KDV EHHQ VKRZQ WR EH UDSLG RQWR FDWLRQ H[FKDQJH VLWHV DQG OLPLWHG RQO\ E\ GLIIXVLRQ WRIURP WKH H[FKDQJHU VXUIDFH 1NHGL.L]]D HW DO f %UXVVHDX HW DO f VXJJHVWHG WKDW FRPSHQVDWLRQ RI FKDUJH LH FDWLRQ VRUSWLRQf OLNHO\ RFFXUV QHDU VXUIDFHV RI RUJDQLF PDWWHU WKHUHIRUH GLIIXVLRQDO FRQVWUDLQWV RI +2&V DQG FDWLRQV GLIIHU EHFDXVH RI WKH SDWK OHQJWK DQG VRUEHQW PDWUL[ 6SHFLILF LQWHUDFWLRQV RI 1+&V ZLWK WKH VRUEHQW DV ZHOO DV DQG PDVV WUDQVIHU FRQVWUDLQWV ZLWKLQ RUJDQLF PDWWHU RU SK\OORVLOLFDWH PLQHUDOV DUH OLNHO\ WR OLPLW VRUSWLRQ RI 1+&V 6RUSWLRQ RI WKH TXLQROLQLXP LRQ LH FDWLRQLF IRUP RI 1+&f RQWR SUHGRPLQDQWO\ RUJDQLF PDWWHU DVVRFLDWHG &(2 VLWHV ZDV VXJJHVWHG WR EH IDVWHU WKDQ VRUSWLRQ RI WKH QHXWUDO VSHFLHV LH VLPLODU WR +2&Vf LQWR WKH RUJDQLF PDWUL[ %UXVVHDX HW DO f 4XLQROLQH LV D FRQWDPLQDQW IRXQG LQ HQHUJ\GHULYHG ZDVWH PDWHULDOV DQG SURGXFWV 7KHUHIRUH LW ZDV VHOHFWHG DV D SUREH WR HYDOXDWH WKH ELFRQWLQXXP VRUSWLRQ PRGHO DQG WR IXUWKHU FKDUDFWHUL]H WKH VRUSWLRQ G\QDPLFV RI 1+&V $ ILUVWRUGHU PRGHO GLG QRW DGHTXDWHO\ GHVFULEH WKH FRPSOH[ LQWHUDFWLRQ RI TXLQROLQH VRUSWLRQ RQWR FOD\ PRGLILHG DOXPLQD ZKHUH b RI WKH VLWHV ZHUH VXJJHVWHG WR EH UHDGLO\ DYDLODEOH )LJXUH 6]HFVRG\ DQG 6WUHLOH f

PAGE 40

&& )LJXUH &DOFLXP Â’f DQG TXLQROLQH Rf %7&V Df S+ Y FPV DQG Ef S+ Y FPV /LQHV FRUUHVSRQG WR HTXLOLEULXP VROLGf DQG ILUVWRUGHU PRGHOV GDVKf IURP 6]HFVRG\ DQG 6WUHLOH f

PAGE 41

7KHUHIRUH WKH PHFKDQLVPV LQIOXHQFLQJ TXLQROLQH VRUSWLRQ PXVW EH DFFXUDWHO\ GHWHUPLQHG WR DVVHVV WKH FRQFHSWXDO YDOLGLW\ DQG DGHTXDF\ RI WKH ELFRQWLQXXP PRGHO 4XLQROLQH 6RUSWLRQ '\QDPLFV )LJXUH GHVFULEHV WKH LRQL]DWLRQ RI TXLQROLQH EHWZHHQ WKH SURWRQDWHG 4+f DQG QHXWUDO VSHFLHV 4f DV D IXQFWLRQ RI S+ 0DWKHPDWLFDOO\ WKH LRQL]DWLRQ RI TXLQROLQH LV UHSUHVHQWHG E\ 4+ rr 4r + A >4r@>+@ >4+@ ZKHUH .D LV WKH LRQL]DWLRQ FRQVWDQW 6RUSWLRQ RI TXLQROLQH KDV EHHQ FKDUDFWHUL]HG LQ EDWFK V\VWHPV XVLQJ VRLO DQG FOD\ PDWHULDOV $LQVZRUWK HW DO =DFKDUD HW D f DQG LQ FROXPQ VWXGLHV XVLQJ PRGLILHG DQG SXUH FOD\V 0F%ULGH HW DO 6]HFVRG\ DQG 6WUHLOH f 4XLQROLQH VRUSWLRQ ZDV DGHTXDWHO\ GHVFULEHG E\ WKH )UHXQGOLFK LVRWKHUP VHH &KDSWHU f 7KHVH VWXGLHV VXJJHVW WKDW WKH TXLQROLQLXP LRQ 4+f LV WKH SUHGRPLQDQW VSHFLHV VRUEHG YLD FDWLRQ H[FKDQJH DW ORZ FRQFHQWUDWLRQV $V VXUIDFH FRYHUDJH LQFUHDVHV TXLQROLQH OLNHO\ RFFXSLHV ORZHU HQHUJ\ VLWHV DQG PXOWLSOH OD\HUV RI TXLQROLQH DW WKH VRUEHQW VXUIDFH PD\ IRUP 0RUH LPSRUWDQWO\ VRUSWLRQ YDULHV ZLWK S+ UHIOHFWLQJ TXLQROLQH LRQL]DWLRQ )LJ HT f DQG SUHIHUHQWLDO UHWHQWLRQ RI WKH RUJDQLF FDWLRQ f f

PAGE 42

)UDFWLRQ 4+ )LJXUH 4XLQROLQH VSHFLDWLRQ GLDJUDP DQG WKH SURWRQDWHG DQG QHXWUDO VSHFLHV VWUXFWXUHV

PAGE 43

6RUSWLRQ RI WKH TXLQROLQLXP LRQ KDV EHHQ VKRZQ HYHQ DW S+ YDOXHV DV PXFK DV XQLWV JUHDWHU WKDQ LWV LRQL]DWLRQ FRQVWDQW S.D f =DFKDUD HW DO 6PLWK HW DO f 7KHUHIRUH LQ D &D VDWXUDWHG KRPRLRQLF VRLO WKH IROORZLQJ FDWLRQ H[FKDQJH UHDFWLRQ FDQ EH XVHG WR GHVFULEH TXLQROLQH H[FKDQJH ZLWK &D &D5 4+ A 4+5 &D f ZKHUH 4+ LV WKH DTXHRXV FRQFHQWUDWLRQ RI WKH TXLQROLQLXP LRQ &D LV WKH DTXHRXV FRQFHQWUDWLRQ RI &D &D5 LV WKH &D RQ WKH H[FKDQJHU FRPSOH[ DQG 4+5 LV WKH TXLQROLQH RQ WKH H[FKDQJHU FRPSOH[ 7KH HTXLOLEULXP FRQVWDQW GHVFULELQJ WKLV UHDFWLRQ LV JLYHQ DV IROORZV B >4+5f &Df@ H[ >&D5-4+f@ ZKHUH f UHIHUV WR WKH DFWLYLW\ RI 4+ DQG &D LQ WKH VROXWLRQ DQG H[FKDQJH SKDVH 7KH FRQGLWLRQDO HTXLOLEULXP FRQVWDQW r.HA RU 9DQVHORZ VHOHFWLYLW\ FRHIILFLHQW .IRU HT LV GHSLFWHG DV >;r++ &D!f f >;FUA2+rf@ ZKHUH ; LV WKH PROH IUDFWLRQ 4+f LV WKH DFWLYLW\ RI 4+ LQ VROXWLRQ DQG &DA LV WKH DFWLYLW\ RI &D LQ VROXWLRQ ,Q HT WKH DFWLYLWLHV LQ WKH H[FKDQJHU SKDVH DUH UHSUHVHQWHG E\ ; 7KH VHOHFWLYLW\ FRHIILFLHQW .Af LV UHODWHG WR WKH HTXLOLEULXP FRQVWDQW .H[f LI WKH UHDFWLRQ LV UHYHUVLEOH E\ WKH UHODWLRQVKLS

PAGE 44

Z B LI I&D f nnY f nnH[ I 4+ ZKHUH WKH DFWLYLW\ FRHIILFLHQWV LQ WKH VROLG SKDVH If RI WKH H[FKDQJLQJ LRQV FRQYHUW DFWLYLW\ WR PROH IUDFWLRQ 4XLQROLQH DQG RWKHU 1+&V IRUP FRPSOH[HV ZLWK QHJDWLYHO\ FKDUJHG VROLG VXUIDFHV VXFK DV FOD\ OD\HU VLOLFDWHV =DFKDUD HW DO f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f DQG FOD\ LVRODWHG IURP WKH 1RUERUQH VRLO .Y WR f VXJJHVWV WKDW VWURQJ TXLQROLQHVXUIDFH FRPSOH[HV DUH IRUPHG $LQVZRUWK HW DO =DFKDUD HW DO f ,Q WKHVH VRLOV DQG SXUH FOD\ PLQHUDOV .Y YDULHG ZLWK S+ DQG ZLWK VXUIDFH FRYHUDJH ZKLFK ZDV VXJJHVWHG WR EH GXH WR VRUSWLRQ RI WKH QHXWUDO VSHFLHV RFFXSDWLRQ RI KLJK HQHUJ\ VLWHV DW ORZ VXUIDFH FRYHUDJHV DQG VXUIDFH FRQGHQVDWLRQ 5HFRQILJXUDWLRQ RI WKH TXLQROLQH PROHFXOH WR D SODQDU SRVLWLRQ ZLWKLQ LQWHUOD\HUV RI FOD\ PLQHUDOV PD\ FRQWULEXWH WR WKH K\VWHUHWLF EHKDYLRU =DFKDUD HW DO f LPSO\LQJ FRQVWUDLQWV WR TXLQROLQH GHVRUSWLRQ 7KH

PAGE 45

LPSOLFDWLRQ RI WKLV RQ TXLQROLQH WUDQVSRUW LQ VRLOV DQG DTXLIHUV ZLOO EH H[DPLQHG LQ D ODWHU VHFWLRQ &KDSWHU f $ KLJK .YIRU TXLQROLQH VXJJHVWV WKDW TXLQROLQH PD\ EH IDYRUHG RYHU LQRUJDQLF FDWLRQV RQ WKH H[FKDQJH FRPSOH[ 2WKHU 1+&V HJ DFULGLQH S\ULGLQHf ZHUH VKRZQ WR UHGXFH TXLQROLQH VRUSWLRQ LQ ORZ S+ VRLOV f ZKHUH FRPSRXQGV DUH SURWRQDWHG DQG VRUSWLRQ RFFXUV YLD FDWLRQ H[FKDQJH =DFKDUD HW DO f +RZHYHU FRPSHWLWLRQ LQ VRLOV ZKHUH WKH QHXWUDO VSHFLHV SUHGRPLQDWHV S+ f ZDV QRW DSSDUHQW 3UHGLFWLYH PRGHOV KDYH QRW EHHQ GHYHORSHG ZKLFK DGHTXDWHO\ GHVFULEH WKH VRUSWLRQ DQG WUDQVSRUW RI 1+&V 6]HFVRG\ DQG 6WUHLOH f 6RUSWLRQ RI 1+&V KDV EHHQ VKRZQ WR EH GHSHQGHQW XSRQ WKH S+ DQG FDWLRQ H[FKDQJH FDSDFLW\ RI WKH VRUEHQW PDWUL[ 7KHUHIRUH DFFRXQWLQJ IRU WKHVH IDFWRUV ZLWK DQ LQGLYLGXDO SDUDPHWHU ZRXOG HQDEOH WKH XVH RI D SUHGLFWLYH PRGHO IRU VRLOV WKDW YDU\ LQ WKHLU FDWLRQ H[FKDQJH FDSDFLW\ DQG S+ ,I WKH SUHGRPLQDQW VRUSWLRQ PHFKDQLVP LV FDWLRQ H[FKDQJH QRUPDOL]DWLRQ RI TXLQROLQH VRUSWLRQ WR 4+ DQG WKH &(& RI WKH VRLO RI PD\ EH GHVFULEHG E\ 6 .WW &Q ff ZKHUH 6 LV WKH VRUEHG FRQFHQWUDWLRQ >PRO 4+ PROFf@ .I )UHXQGOLFKW\SH VRUSWLRQ FRHIILFLHQW >/QfPRO 4+>nQf@fPROFf@ & HTXLOLEULXP VROXWLRQ FRQFHQWUDWLRQ >PRO 4+OB@ DQG Q LVRWKHUP FRQVWDQW 7KLV UHODWLRQVKLS UHVHPEOHV D )UHXQGOLFKW\SH LVRWKHUP ZKHUH WKH GHVFULEHV WKH VRUSWLRQ RI 1+&V DFFRXQWLQJ IRU YDULDWLRQV LQ WKH FDWLRQ H[FKDQJH FDSDFLW\ DQG S+ RI WKH VRLO

PAGE 46

7KH LRQ H[FKDQJH RI TXLQROLQH DQG &D LQ D V\VWHP LQLWLDOO\ VDWXUDWHG ZLWK &DZDV GHVFULEHG LQ HT DQG UHSUHVHQWHG E\ .Y )UHXQGOLFK LVRWKHUPV DUH QRW FRQVLGHUHG WR EH LRQ H[FKDQJH LVRWKHUPV +RZHYHU DVVXPLQJ VRUSWLRQ RI WKH SURWRQDWHG VSHFLHV RQWR FDWLRQ H[FKDQJH VLWHV DQG WKH IUDFWLRQ RI WKH &(& RFFXSLHG E\ TXLQROLQH LV VPDOO WKH .WI PD\ EH UHODWHG WR WKH .Y E\ WKH IROORZLQJ UHODWLRQVKLS .X 1 4+ D 1-AO a !_ 1 f ZKHUH 1 LV WKH QRUPDOLW\ RI WKH EDFNJURXQG HOHFWURO\WH VROXWLRQ +RZHYHU =DFKDUD HW DO f SUHGLFWHG EDVHG RQ HT WKDW WKH WRWDO VRUEHG TXLQROLQH H[FHHGHG WKH IUDFWLRQ RI TXLQROLQH H[LVWLQJ DV WKH TXLQROLQXP LRQ $GGLWLRQDO VRUSWLRQ RI TXLQROLQH FRXOG KDYH EHHQ GXH WR VRUSWLRQ RI WKH QHXWUDO VSHFLHV FOXVWHULQJ RI WKH VUEDWH VXUIDFH FRQGHQVDWLRQ RU SURWRQDWLRQ RI TXLQROLQH DW WKH H[FKDQJHU VXUIDFH $LQVZRUWK HW DO =DFKDUD HW DO f +RZHYHU PHDVXUHPHQW RI HQKDQFHG DFLGLW\ WKXV SURWRQDWLRQ RI TXLQROLQLXP DW VRLO VXUIDFHV LV QRW D WULYLDO WDVN 6RUSWLRQ RI WKH QHXWUDO VSHFLHV DQG FRRSHUDWLYH DGVRUSWLRQ KDYH EHHQ UHSRUWHG $LQVZRUWK HW DO f WR RFFXU DW KLJK VXUIDFH FRYHUDJHV YLD HQWURSLF RU YDQ GHU :DDOV IRUFHV 6RUSWLRQ RI TXLQROLQH RQWR VRLOV S+ WR f ZDV WKRXJKW WR RFFXU YLD FDWLRQ H[FKDQJH LQ WKH SUHVHQFH RI FRVROYHQW PL[WXUHV >YROXPH IUDFWLRQ RI FRVRLYHQW IA @ =DFKDUD HW DO f )X DQG /XWK\ Df VXJJHVWHG WKDW FRVROYHQWV GHFUHDVHG TXLQROLQH VRUSWLRQ LQ UHVSRQVH WR DQ LQFUHDVH LQ

PAGE 47

TXLQROLQH VROXELOLW\ 4XLQROLQH LVRWKHUPV DW KLJK FRQFHQWUDWLRQV WR PJ/f ZHUH VXJJHVWHG WR EH OLQHDU LQ ZDWHUPHWKDQRO V\VWHPV XS WR IF )X DQG /XWK\ Ef 6RUSWLRQ DW ORZ FRQFHQWUDWLRQV m QJP/f ZDV VXJJHVWHG WR EH QRQOLQHDU LQ DTXHRXV V\VWHPV Q f DQG LQ PHWKDQROZDWHU VROXWLRQV YRO b PHWKDQRO Q f =DFKDUD HW DO f ,VRWKHUP OLQHDULW\ KDV EHHQ VKRZQ WR LQFUHDVH XSRQ DGGLWLRQ RI FRVROYHQWV IRU SDUWLWLRQLQJ RI VROXWHV LQWR DQ RUJDQLF PDWUL[ KRZHYHU LI LRQ H[FKDQJH SUHGRPLQDWHV VSHFLILF LQWHUDFWLRQV ZLWK FDWLRQ H[FKDQJH VLWHV PD\ EH DOWHUHG )RU RUJDQLF EDVHV DQG DFLGV DGGLWLRQ RI VROYHQWV LQFUHDVHV WKH IUDFWLRQ RI QHXWUDO VSHFLHV 3HUULQ HW DO /HH f ,Q WKH SUHVHQFH RI FRVROYHQWV FKDQJHV LQ WKH S.D YDOXHV IRU RUJDQLF EDVHV DUH PLQLPDO 3HUULQ HW DO f +RZHYHU VXEVWDQWLDO LQFUHDVHV LQ S.D YDOXHV IRU RUJDQLF DFLGV KDYH EHHQ VKRZQ GXH WR VROXWHVROYHQW LQWHUDFWLRQV UHVXOWLQJ LQ GHFUHDVHG VRUSWLRQ RI SKHQROLF FRPSRXQGV DQG LQFUHDVHG VRUSWLRQ RI FDUER[\OLF DFLGV IF f /HH f &RQVLGHULQJ WKDW WKH TXLQROLQLXP LRQ VRUSWLRQ RFFXUV SUHGRPLQDWHO\ RQWR FDWLRQ H[FKDQJH VLWHV DW ORZ VXUIDFH FRYHUDJHV RQH FRXOG HQYLVLRQ UDWHOLPLWHG GHVRUSWLRQ RI TXLQROLQH RXW RI LQWHUODPHOODU UHJLRQV RI FOD\ PLQHUDOV DQG DJJUHJDWHV RU LQWUDRUJDQLF PDWWHU UHJLRQV 6XFK PDVV WUDQVIHU FRQVWUDLQWV GHOD\ WKH UHOHDVH RI FRQWDPLQDQWV OHDGLQJ WR SHUVLVWHQFH LQDGHTXDWH UHPHGLDWLRQ DQG OLPLWHG ELRDYDLODELOLW\

PAGE 48

5HVHDUFK 4XHVWLRQ DQG 7DVNV 7KH SULPDU\ REMHFWLYH RI WKHVH VWXGLHV DUH WR LQYHVWLJDWH WKH SURFHVVOHYHO NLQHWLFV RI TXLQROLQH VRUSWLRQ E\ VRLOV DGGUHVVLQJ WKH TXHVWLRQ ZKDW DUH WKH UDWHOLPLWLQJ SURFHVVHV FRQWUROOLQJ ELRUHPHGLDWLRQ SUDFWLFHV RI 1+&V" (TXLOLEULXP DQG PDVV WUDQVIHU FRHIILFLHQWV IRU VRUSWLRQ DQG GHVRUSWLRQ ZHUH PHDVXUHG DV D IXQFWLRQ RI S+ PRODULW\ 0f DQG VRUEHQW 7KH ELFRQWLQXXP QRQOLQHDU VRUSWLRQ PRGHO FRXSOHG ZLWK WKH DGYHFWLYHGLVSHUVLYH VROXWH WUDQVSRUW PRGHO ZDV XVHG WR DVVHVV TXLQROLQH VRUSWLRQ DQG WUDQVSRUW GXULQJ RQHn GLPHQVLRQDO VWHDG\ ZDWHU IORZ 0DWHULDOV DQG 0HWKRGV 6RUEHQW 7KH VRLOV XVHG LQ WKLV VWXG\ DQG WKHLU SURSHUWLHV DUH SUHVHQWHG LQ 7DEOH 6RLOV ZHUH VWHULOL]HG IRU PLQ E\ VWHDP DXWRFODYLQJ J VDPSOHV WKDW ZHUH EURXJKW WR b ZDWHU FRQWHQW DQG LQFXEDWHG IRU KRXUV 7KH SURFHVV ZDV UHSHDWHG WZR DGGLWLRQDO WLPHV DQG WKH VRLO ZDV XVHG LQ DOO VXEVHTXHQW H[SHULPHQWV XQOHVV RWKHUZLVH QRWHG 7KH VRLOV XVHG LQ WKH EDWFK DQG FROXPQ H[SHULPHQWV ZHUH LQLWLDOO\ VDWXUDWHG ZLWK &D &DWLRQ H[FKDQJH PHDVXUHPHQWV ZHUH PHDVXUHG DW WKH S+ RI WKH VRLO 6HH 7DEOH f 6ROXWHV 3HQWDIOXRUREHQ]RLF DFLG 3)%$ PJ/f DQG AS FSPP/f ZHUH XVHG DV FRQVHUYDWLYH QRQVRUELQJ WUDFHUV WR DVVHVV WKH K\GURG\QDPLF

PAGE 49

7DEOH 6RLO SURSHUWLHV EHIRUH DQG DIWHU VWHDP DXWRFODYLQJ 6RLO S+ LQ 0 &D&, IRH &(& FPROfNJ ORFDWLRQ RI &(& (XVWLV RUJDQLF PDWWHU DQG NDROLQLWLF 6WHULOH (XVWLV FOD\ PLQHUDOV 1RUERUQH VPHFWLWH FOD\ PLQHUDOV DQG 6WHULOH 1RUERUQH RUJDQLF PDWWHU :HEVWHU RUJDQLF PDWWHU DQG VPHFWLWH FOD\ PLQHUDOV GLVSHUVLRQ DQG H[WHQW RI SK\VLFDO QRQHTXLOLEULXP FRQGLWLRQV SUHYDLOLQJ GXULQJ WUDQVSRUW WKURXJK WKH VRLO FROXPQV %UXVVHDX DQG 5DR Df 4XLQROLQH FRQFHQWUDWLRQV LQ WKH LQIOXHQW VROXWLRQV IRU WKH FROXPQ VWXGLHV UDQJHG IURP WR PJ/ &TXLQROLQH 6LJPDf DQG VSLNHG WR REWDLQ VROXWLRQV DW FSPP/ %DWFK VWXGLHV ZHUH FRQGXFWHG IRU +\GUR[\TXLQROLQH +4f DQG TXLQROLQH RYHU WKH FRQFHQWUDWLRQ UDQJH RI LQWHUHVW DW HLWKHU WR DQG WR PDVV WR YROXPH UDWLRV ,VRWRSLF H[FKDQJH RI &WD DQG A&D FSPP/f ZDV DOVR LQYHVWLJDWHG $TXHRXV VROXWLRQV RI WKH FKHPLFDOV ZHUH SUHSDUHG LQ ILOWHUVWHULOL]HG SPf RU 0 &D&A %DFNJURXQG PDWUL[ VROXWLRQV 0 &D&\ ZHUH ILOWHU VWHULOL]HG LPf WR PLQLPL]H ELRGHJUDGDWLRQ RI RUJDQLF VROXWHV ([SHULPHQWDO 6HWXS %DWFK WHFKQLTXHV 1NHGL.L]]D HW DO f ZHUH XVHG WR DVVHVV VRUSWLRQGHVRUSWLRQ NLQHWLFV DQG HTXLOLEULXP FRQVWDQWV IRU TXLQROLQH LQ VWHULOH V\VWHPV $ VWLUUHG EDWFK UHDFWRU ZDV XVHG WR PHDVXUH TXLQROLQH VRUSWLRQ

PAGE 50

NLQHWLFV 7KH VRLO IUDFWLRQ P ZDV XVHG LQ WKH VWLUUHG EDWFK UHDFWRU WR PLQLPL]H VHSDUDWLRQ RI WKH VRLO VXVSHQVLRQ 7KH VRLO IUDFWLRQ Jf ZDV DGGHG WR P/ 0 &D&,A $W YDULRXV WLPH LQWHUYDOV WKH VXVSHQVLRQ ZDV VDPSOHG DQG LPPHGLDWHO\ VHSDUDWHG WKURXJK D P WHIORQ ILOWHU 7KH ILOWUDWH &f ZDV DQDO\]HG WR GHWHUPLQH WKH TXLQROLQH FRQFHQWUDWLRQ DW YDULRXV WLPH LQWHUYDOV IRU GD\V )ORZWKURXJK FROXPQ WHFKQLTXHV %UXVVHDX HW DO f ZHUH XWLOL]HG WR GHWHUPLQH VRUSWLRQ UDWH FRHIILFLHQWV IRU TXLQROLQH XVLQJ VWHULOH EDFNJURXQG PDWUL[ VROXWLRQV 7KH VWHULOH VRLO ZDV SDFNHG LQWR D .RQWHV JODVV FROXPQ FP ORQJ FP LGf %HG VXSSRUWV RQ ERWK HQGV RI WKH FROXPQ FRQVLVWHG RI D WHIORQ GLIIXVLRQ PHVK ZLWK D JODVV PHPEUDQH SRURXV ILOWHU XUQf 7KH SXPSV DQG WXELQJ ZHUH GLVLQIHFWHG E\ ULQVLQJ ZLWK PHWKDQRO 7KH JODVV FROXPQV DQG VROXWLRQ YHVVHOV ZHUH VWHULOL]HG E\ DXWRFODYLQJ $IWHU SDFNLQJ DSSUR[LPDWHO\ SRUH YROXPHV RI RU 0 &D&, VROXWLRQ ZHUH SXPSHG WKURXJK WKH FROXPQ WR DFKLHYH VDWXUDWHG VWHDG\ ZDWHU IORZ FRQGLWLRQV ([SHULPHQWV ZHUH FRQGXFWHG XQGHU VDWXUDWHG VWHDG\ ZDWHU IORZ FRQGLWLRQV DW SRUH ZDWHU YHORFLWLHV RI WR FPKU ,Q GLVSODFHPHQW VWXGLHV WKH PRODULW\ 0 0f DQG S+ RI WKH GLVSODFLQJ VROXWLRQ ZHUH YDULHG 6ROXWH FRQFHQWUDWLRQV ZHUH PRQLWRUHG FRQWLQXRXVO\ RU E\ FROOHFWLQJ FROXPQ HIIOXHQW IUDFWLRQV )ORZ WKURXJK 89 GHWHFWLRQ *LOVRQ +RORFKURPH RU 0LOWRQ 5R\ /'&f ZDV PRQLWRUHG FRQWLQXRXVO\ DW QP IRU TXLQROLQH DQG +4 DQG QP IRU 3)%$ 'HWHFWRU UHVSRQVH ZDV UHFRUGHG XVLQJ D VWULS FKDUW UHFRUGHU )LVKHU 6HULHV f (IIOXHQW VDPSOHV ZHUH FROOHFWHG LQWHUPLWWHQWO\

PAGE 51

DQG DQDO\]HG E\ +3/&89 WHFKQLTXHV *LOVRQ 89 GHWHFWRU *LOVRQ 0RGHO SXPS :DWHUV :,63 2% DXWRVDPSOHU +3$ ,QWHJUDWRUf WR YHULI\ VDPSOH SXULW\ DQG WR FRPSDUH WKH LQLWLDO VROXWH FRQFHQWUDWLRQ WR WKH PD[LPXP HIIOXHQW FRQFHQWUDWLRQ 4XLQROLQH DQG +4 ZHUH HOXWHG IURP D UHYHUVHGSKDVH FROXPQ 6XSHOFR /&3$+ FROXPQf DW D IORZ UDWH RI P/PLQ ZLWK D PRELOH SKDVH RI YYYf PHWKDQRO DFHWRQLWULOH DQG ZDWHU DGMXVWHG WR S+ ZLWK +&, 6RLO FROXPQ HIIOXHQW S+ ZDV PRQLWRUHG RQOLQH XVLQJ DQ ,QJROG PLFURHOHFWURGH /HH HW DO f (IIOXHQW IUDFWLRQV RI WKH UDGLRODEHOHG FRPSRXQGV ZHUH FROOHFWHG ZLWK DQ DXWRPDWLF VDPSOH FROOHFWRU ,6&2 0RGHO f 7KH DFWLYLW\ RI HDFK UDGLRODEHOHG FRPSRXQG ZDV DVVD\HG XVLQJ D OLTXLG VFLQWLOODWLRQ FRXQWHU 6HDUOH 'HOWD f 'DWD $QDO\VLV 5HWDUGDWLRQ IDFWRUV 5f ZHUH FDOFXODWHG IURP DUHD DERYH WKH %7& IRU TXLQROLQH DQG QDSKWKDOHQH 1NHGL.L]]D HW DO f D OLQHDU H[WUDSRODWLRQ WHFKQLTXH ZDV XVHG WR H[WHQG WKH %7&V WR && LQ RUGHU WR HVWLPDWH WKH DUHD DERYH WKH %7& )RU (&D SXOVHV WKH 5 ZDV FDOFXODWHG E\ PRPHQW DQDO\VLV WHFKQLTXHV %UXVVHDX HW DO f 7KH FXUYH ILWWLQJ SURJUDP &),7,0 YDQ *HQXFKWHQ f ZKLFK LV EDVHG RQ QRQOLQHDU OHDVWVTXDUHV RSWLPL]DWLRQ WHFKQLTXHV ZDV XVHG WR HVWLPDWH WKH 3HFOHW QXPEHU 3f IURP WKH %7& IRU 3)%$ )RU QRQVRUEHG VROXWHV 5 f WZR PRGHO SDUDPHWHUV FDQ EH RSWLPL]HG 3 DQG WKH VROXWH SXOVH VL]H -f 6LQFH WKH SXOVH VL]H ZDV GHWHUPLQHG H[SHULPHQWDOO\ RQO\ WKH YDOXH IRU 3 ZDV HVWLPDWHG E\ ILWWLQJ WR WKH PHDVXUHG

PAGE 52

%7& IRU 3)%$ RU )RU VRUEHG VROXWHV 5!f ILYH PRGHO SDUDPHWHUV FDQ EH RSWLPL]HG 35 S Z DQG )RU $&D DQG QDSKWKDOHQH %7&V 5 ZDV IL[HG HVWLPDWHG DV GHVFULEHG DERYHf ZDV H[SHULPHQWDOO\ GHWHUPLQHG 3 ZDV IL[HG DV WKH YDOXH HVWLPDWHG IURP 3)%$ %7&V DQG WKH YDOXHV RI QRQHTXLOLEULXP VRUSWLRQ SDUDPHWHUV S DQG Rf ZHUH HVWLPDWHG IURP SDUDPHWHU RSWLPL]DWLRQ XVLQJ WKH &),7,0 SURJUDP )RU TXLQROLQH %7&V WKH FXUYH ILWWLQJ SURJUDP )/2,17 %UXVVHDX HW DO f ZLWK QRQOLQHDU VRUSWLRQ LVRWKHUPV ZDV XVHG WR HVWLPDWH WKH SDUDPHWHUV ZKHQ IORZ LQWHUUXSWLRQ WHFKQLTXHV ZHUH XVHG WR HQKDQFH WKH LQYHVWLJDWLRQ RI VRUSWLRQ QRQHTXLOLEULXP SURFHVVHV 5HVXOWV DQG 'LVFXVVLRQ 6WHULOL]DWLRQ 7HFKQLTXHV ,QLWLDO EDWFK VWXGLHV ZHUH FRQGXFWHG WR FKDUDFWHUL]H WKH VRUSWLRQ RI TXLQROLQH DQG WR DVVHVV WHFKQLTXHV XVHG IRU VRLO VWHULOL]DWLRQ %DWFK VRUSWLRQ H[SHULPHQWV ZHUH FRQGXFWHG XVLQJ WKUHH QRQVWHULOL]HG DLUGU\ VRLOV DQG WZR VRLOV VWHULOL]HG E\ VWHDP DXWRFODYLQJ WHFKQLTXHV $XWRFODYLQJ KDG PLQLPDO HIIHFW bf RQ WKH SURSHUWLHV RI WKH 1RUERUQH VRLO 7DEOH f &(& PHDVXUHG E\ A&D LVRWRSLF H[FKDQJH %DEFRFN DQG 6FKXO] f DQG WKH 0J1 H[WUDFW SURFHGXUH 5KXH DQG 5HYH f UHVXOWHG LQ VLPLODU YDOXHV IRU QRQVWHULOL]HG DQG DXWRFODYHG VRLOV 6HH 7DEOH f 0HDVXUHPHQW RI A&D LVRWRSLF H[FKDQJH RYHU WLPH VXJJHVWHG WKDW FDWLRQ H[FKDQJH RQ 1RUERUQH VRLO ZDV FRPSOHWHG ZLWKLQ WKH ILUVW PLQXWHV ,VRWRSLF H[FKDQJH WKXV PLJUDWLRQ RI A&D LQWR WKH LQWHUOD\HU H[FKDQJH VLWHV ZDV YLUWXDOO\ LQVWDQWDQHRXV 7KH &(& RI WKH (XVWLV VRLO

PAGE 53

LQFUHDVHG DERXW b DIWHU DXWRFODYLQJ 7KH VWDQGDUG GHYLDWLRQ RI WKH &(& HVWLPDWHV IRU WKLV VDPSOH KRZHYHU ZDV KLJK 1RQXQLIRUPLW\ LQ VRLO VDPSOLQJ PD\ KDYH FDXVHG VRPH RI WKLV HUURU 2Q WKH RWKHU KDQG WKH LQFUHDVH PD\ KDYH EHHQ FDXVHG E\ UHOHDVH RI RUJDQLF DFLGV DOWHUDWLRQ RI WKH RUJDQLF PDWWHU VWUXFWXUH RU D FKDQJH LQ WKH LQWHUIDFLDO S+ WKRXJK WKH EXON S+ LV WKH VDPH 7KH VRLOV 7DEOH f YDULHG LQ S+ FDWLRQ H[FKDQJH FDSDFLW\ DQG ORFDWLRQ RI FKDUJH 7KH TXLQROLQH VRUSWLRQ LVRWKHUP SORWWHG RQ D ORJORJ VFDOH ZDV QRUPDOL]HG WR WKH SURWRQDWHG VSHFLHV 4+ f LQ WKH VRUEHG DQG VROXWLRQ SKDVHV DQG WKH &(& RI WKH VRLO PPROfJf 7KH VRUSWLRQ GDWD IRU DOO VRLOV FDQ EH UHSUHVHQWHG E\ D VLQJOH VFDOHG LVRWKHUP )LJXUH f VXJJHVWLQJ WKDW TXLQROLQH VRUSWLRQ RFFXUV SULPDULO\ YLD FDWLRQ H[FKDQJH 6RUSWLRQ LVRWKHUPV ZHUH QRQOLQHDU Q WR f RYHU WKH FRQFHQWUDWLRQ UDQJH LQYHVWLJDWHG $W KLJKHU FRQFHQWUDWLRQV )LJXUH f VRUSWLRQ RI TXLQROLQH LQFUHDVHV LQ WKH 1RUERUQH DQG :HEVWHU VRLO 7KH 6W\SH VRUSWLYH EHKDYLRU IRU WKHVH VRLOV RFFXUV DW KLJK FRQFHQWUDWLRQV PJ/f ZKHUH b RI TXLQROLQH LV SUHVHQW DV WKH QHXWUDO VSHFLHV &RRSHUDWLYH LQWHUDFWLRQV EHWZHHQ WKH VRUEHG VSHFLHV DQG PXOWLOD\HU VRUSWLRQ KDV EHHQ VXJJHVWHG WR HQKDQFH TXLQROLQH VRUSWLRQ FOD\ PLQHUDOV DW KLJK FRQFHQWUDWLRQV $LQVZRUWK HW DO f +RZHYHU DW WKLV FRQFHQWUDWLRQ OHVV WKDQ b RI WKH FDWLRQ H[FKDQJH VLWHV DUH RFFXSLHG E\ TXLQROLQH 7KLV EHKDYLRU PD\ UHVXOW IURP DJJUHJDWLRQ RI VRUSWLRQ VLWHV ZKHUH TXLQROLQH VRUSWLRQ RFFXUV LQ FROORFDWLRQ ZLWK FOD\ PLQHUDO DJJUHJDWHV RU RUJDQLF PDWWHU 7KH

PAGE 54

k (XVWLV 2 6WHULOH (XVWLV i! r :HEVWHU (O 1RUERUQH r ’ 6WHULOH 1RUERUQH -R f§ b rn f§Lf§ :U + 9 L ’ KL Q L M L L L L L L L L L ‘ L /RJ &_ >PRO 4+/@ )LJXUH 4XLQROLQH VRUSWLRQ LVRWKHUPV IRU WKUHH VRLOV QRUPDOL]HG WR WKHLU FDWLRQ H[FKDQJH FDSDFLW\ DQG WR WKH IUDFWLRQ RI SURWRQDWHG VSHFLHV 6HH HT f

PAGE 55

(XVWLV VRLO S+ f KDV D KLJKHU IUDFWLRQ RI 4+ SUHVHQW IRU WKH VDPH LQLWLDO TXLQROLQH ORDGLQJ WKDQ WKH RWKHU VRLOV S+ DQG f VHH )LJXUH f 7KH LVRWKHUP QRQOLQHDULW\ IRU WKH (XVWLV VRLO UHPDLQV FRQVWDQW DW KLJK FRQFHQWUDWLRQV RI 4+ 7KLV VXJJHVWV WKDW VRUSWLRQ RI WKH QHXWUDO VSHFLHV PD\ EH RFFXUULQJ LQ WKH KLJKHU S+ VRLOV $QRWKHU SRVVLEOH H[SODQDWLRQ LV WKDW KLJK HQHUJ\ FDWLRQ H[FKDQJH VLWHV DUH WKH ILUVW VLWHV RFFXSLHG E\ TXLQROLQH IROORZHG E\ VRUSWLRQ RQWR ORZHU HQHUJ\ VLWHV VXFK KDV EHHQ VKRZQ IRU VRUSWLRQ RI LQRUJDQLF FRPSRXQGV 2f&RQQRU HW DO f ,QYHVWLJDWLRQ RI TXLQROLQH VRUSWLRQ NLQHWLFV VXJJHVWHG WKDW VRUSWLRQ RFFXUUHG YLD D WKUHH VWHS SURFHVV )LJXUH f $ERXW b RI TXLQROLQH VRUSWLRQ RFFXUUHG RQWR UHDGLO\ DYDLODEOH RU LQVWDQWDQHRXVO\ DFFHVVLEOH VRUSWLRQ VLWHV 7KHVH VLWHV KDYH W\SLFDOO\ EHHQ WKRXJKW WR H[LVW RQ H[WHUQDO UHJLRQV RI WKH VRUEHQW PDWUL[ %UXVVHDX DQG 5DR f +RZHYHU WKHVH VLWHV PD\ LQFOXGH H[WHUQDO VLWHV RU UHDGLO\ DFFHVVLEOH LQWHUQDO VLWHV GHSHQGLQJ XSRQ WKH DUFKLWHFWXUH RI WKH VRUEHQW 2NXGD f 6RUSWLRQ RI TXLQROLQH RFFXUV SUHGRPLQDQWO\ RQ FDWLRQ H[FKDQJH VLWHV ORFDWHG ZLWKLQ RUJDQLF PDWWHU DQG VPHFWLWH PLQHUDOV 7KH VORZHU UDWHV RI TXLQROLQH VRUSWLRQ OLNHO\ FRUUHVSRQG WR VRUSWLRQ DQG UHGLVWULEXWLRQ LQ WKH LQWHUQDO OHVVDFFHVVLEOH UHJLRQV RI WKH VRUEHQW ,Q D ELQDU\ VROXWH EDWFK V\VWHP TXLQROLQH VRUSWLRQ DW ORZ FRQFHQWUDWLRQV ZDV XQDIIHFWHG E\ WKH SUHVHQFH RI LWV SULPDU\ GHJUDGDWLYH PHWDEROLWH K\GUR[\TXLQROLQH +4f DW S+ )LJXUH f 7KH GDWD SRLQWV DW WKH KLJKHVW TXLQROLQH FRQFHQWUDWLRQ KDG WKH JUHDWHVW DPRXQW RI VFDWWHU LQ WKH GDWD ZKLFK

PAGE 56

,Q &&UWf )LJXUH 6WLUUHG EDWFK UHDFWRU Df DQG TXLQROLQH VRUSWLRQ RQWR WKH 1RUERUQH VRLO IUDFWLRQ 0P Ef ZKHUH & TXLQROLQH ILOWUDWH FRQFHQWUDWLRQ DQG & WKH LQLWLDO TXLQROLQH FRQFHQWUDWLRQf

PAGE 57

: +4 PJ/f R R ]V rr Â’ $ r 5H k R R R N L L & PJ/f )LJXUH 6RUSWLRQ RI TXLQROLQH RQ WKH 1RUERUQH VRLO LQ WKH SUHVHQFH RI K\GUR[\TXLQROLQH

PAGE 58

FDXVHG YDULDWLRQ LQ WKH Q YDOXHV 0F%ULGH HW DO f VXJJHVWHG WKDW E\ DGGLQJ +4 DQG PJ/f TXLQROLQH VRUSWLRQ LQ VRLO FROXPQV ZDV UHGXFHG DV PXFK DV b &RPSHWLWLYH DGVRUSWLRQ KDV EHHQ VKRZQ IRU 1+&V VXFK DV S\ULGLQH TXLQROLQH DQG DFULGLQH =DFKDUD HW DO f ZKHUH WKH FRPSRXQGV DGVRUE RQWR WKH VDPH OLPLWHG QXPEHU RI FDWLRQ H[FKDQJH VLWHV )RU +2&V FRPSHWLWLYH VRUSWLRQ LV QRW OLNHO\ EHFDXVH VRUSWLRQ RFFXUV YLD SDUWLWLRQLQJ &KLRX HW DO f +4 H[LVWV LQ LWV QHXWUDO IRUP S.D f LQ WKH 1RUERUQH VRLO 7KH SUHGRPLQDQW PHFKDQLVP RI +4 VRUSWLRQ LV K\GURSKRELF SDUWLWLRQLQJ ZKLOH TXLQROLQH VRUSWLRQ RFFXUV SUHGRPLQDQWO\ RQWR FDWLRQ H[FKDQJH VLWHV 7KHUHIRUH FRPSHWLWLYH VRUSWLRQ ZDV QRW H[SHFWHG ,I KRZHYHU RUJDQLF PDWWHU LV ORFDWHG LQ FRQMXQFWLRQ ZLWK WKH SK\OORVLOLFDWH PLQHUDOV 6WHYHQVRQ f TXLQROLQH VRUSWLRQ PD\ KDYH EHHQ UHGXFHG GXH WR WKH LQWHUIHUHQFH RI +4 DQG TXLQROLQH VRUELQJ LQ WKH VDPH ORFDWLRQ RI WKH RUJDQLF PDWWHUPLQHUDO FRPSOH[ 7KLV EHKDYLRU PD\ EHFRPH PRUH DSSDUHQW LQ FROXPQ VWXGLHV 0F%ULGH HW DO f ZKHUH GLIIXVLRQDO PDVV WUDQVIHU FRQVWUDLQWV IXUWKHU OLPLW VRUSWLRQ 7KHVH VWXGLHV VXJJHVW WKDW +4 SURGXFWLRQ XSRQ TXLQROLQH ELRGHJUDGDWLRQ LV QRW OLNHO\ WR UHGXFH TXLQROLQH VRUSWLRQ E\ FRPSHWLQJ IRU DYDLODEOH VRUSWLRQ VLWHV 6RUSWLRQ '\QDPLFV 3K\VLFDO FKDUDFWHUL]DWLRQ 7KH + DQG 3)%$ EUHDNWKURXJK FXUYHV %7&Vf IRU DOO VRLO FROXPQV ZHUH V\PPHWULFDO DQG VLJPRLGDO LQ VKDSH HJ )LJXUH f VXJJHVWLQJ WKH DEVHQFH RI WUDQVSRUWUHODWHG QRQHTXLOLEULXP 3HFOHW QXPEHUV 3f ZHUH DOO JUHDWHU WKDQ LQGLFDWLQJ PLQLPDO K\GURG\QDPLF

PAGE 59

5HODWLYH &RQFHQWUDWLRQ &4f )LJXUH ([DPSOHV RI EUHDNWKURXJK FXUYHV IRU 3)%$ DQG + LQ 1RUERUQH VRLO FROXPQV

PAGE 60

GLVSHUVLRQ 7DEOH f 6OLJKW UHWDUGDWLRQ 5 m f RI %7&V IRU + RQ WKH 1RUERUQH VRLO VXJJHVWV WKDW WKLV WUDFHU ZDV VRUEHG 6RUSWLRQ RI + RQWR D VRLO KLJK LQ LURQ R[LGH FRQWHQW WKDW FRQWDLQV SUHGRPLQDWHO\ NDROLQLWLF FOD\ PLQHUDOV KDV EHHQ SUHYLRXVO\ UHSRUWHG 1NHGL.L]]D HW DO f 7KH 1RUERUQH VRLO DOVR FRQWDLQV LURQ R[LGHV ZLWK W\SH FOD\ PLQHUDOV =DFKDUD HW DO f WKXV + VRUSWLRQ LV OLNHO\ 6RUSWLRQ RI + PD\ LQGLFDWH WKDW ZDWHU LV H[FKDQJHG ZLWK K\GUDWHG VRUEHG LRQV RQ WKH FOD\ VXUIDFH 6]HFVRG\ DQG 6WUHLOH f %DWFK VWXGLHV ZHUH FRQGXFWHG WR PHDVXUH + VRUSWLRQ RQWR VWHULOH 1RUERUQH VRLO 7KH VRUSWLRQ FRHIILFLHQW .Gf ZDV s f P/J 7KHVH .G YDOXHV DUH FRQVLVWHQW ZLWK UHWDUGDWLRQ IDFWRU 5f YDOXHV UDQJLQJ IURP WR REVHUYHG LQ GLIIHUHQW FROXPQV 7KH SRUH YROXPHV GHWHUPLQHG E\ + DIWHU FRUUHFWLQJ IRU VRUSWLRQ UHVXOWHG LQ VLPLODU SRUH YROXPHV DV GHWHUPLQHG XVLQJ JUDYLPHWULF PHWKRGV DQG WKH %7& GDWD IRU GLVSODFHPHQW + ZDV QRW VRUEHG RQWR WKH (XVWLV VRLO 5 m f &KHPLFDO FKDUDFWHUL]DWLRQ 0RQLWRULQJ &D DQG TXLQROLQH VRUSWLRQ DQG WUDQVSRUW XQGHU VSHFLILF FKHPLFDO DQG SK\VLFDO FRQGLWLRQV HJ PRODULW\ RI VROXWLRQ S+ DQG SRUHZDWHU YHORFLW\f ZLOO KHOS XQGHUVWDQG PHFKDQLVPV LQIOXHQFLQJ TXLQROLQH EHKDYLRU 7KH GDWD IRU &D DQG TXLQROLQH ZHUH XWLOL]HG WR H[SORUH WKH DFFHVVLELOLW\ RI FDWLRQ H[FKDQJH VLWHV E\ DQ LQRUJDQLF FDWLRQ DQG DQ RUJDQLF FDWLRQ 1RQHTXLOLEULXP VRUSWLRQ ZDV H[SORUHG E\ REVHUYLQJ LVRWRSLF H[FKDQJH RI ERWK &D&D DQG &TXLQROLQH&TXLQROLQH DV ZHOO DV WKH H[FKDQJH RI TXLQROLQH IRU FDOFLXP 7KH EHKDYLRU RI WKHVH WZR VROXWHV ZHUH

PAGE 61

7DEOH &ROXPQ SDUDPHWHUV IRU VWHULOH VRLO FROXPQV &ROXPQ ,' &D&L PRO/ S+ 3 JFP P/FP 3 1RUERUQH VRLO FROXPQV %4 $ % %4 %4 QGr %4 QG )ORLQW S+ S+ QG (XVWLV VRLO FROXPQV %4 '&0$ r QG QRW GHWHUPLQHG FRPSDUHG LQ D VRLO ZKHUH VRUSWLRQ RFFXUUHG SULPDULO\ LQ RUJDQLF PDWWHU bf DQG NDROLQLWLF PLQHUDOV DQG LQ D VRLO ZKHUH VRUSWLRQ RFFXUUHG SULPDULO\ RQ VPHFWLWH W\SH PLQHUDOV DQG RUJDQLF PDWWHU )LJXUH VKRZV WKH %7& IRU &D LQ DQG 0 &D&, 7KH UHWDUGDWLRQ IDFWRU IRU &D LQ WKH 0 &D&, VRLO FROXPQ LV ZKHUHDV WKH 5 LQ 0 &D&, LV 7KH VRUSWLRQ FRHIILFLHQW .Gf RI &D LV UHODWHG GLUHFWO\ WR WKH &(& RI WKH VRLO DQG LQYHUVHO\ WR WKH QRUPDOLW\ 1f RI WKH EDFNJURXQG HOHFWURO\WH VROXWLRQ .G m &(&1f :LONODQGHU f 7KHUHIRUH D IDFWRURIWHQ LQFUHDVH LQ 1 VKRXOG UHVXOW LQ D IROG GHFUHDVH LQ .G 7KLV ZDV LQGHHG WKH FDVH IRU VRUSWLRQ FRHIILFLHQWV IRU &D LQ WKH VWHULOH 0 &D&,

PAGE 62

5HODWLYH &RQFHQWUDWLRQ &4f )LJXUH 4XLQROLQH DQG &D EUHDNWKURXJK FXUYHV ZLWK IORZ LQWHUUXSWLRQV LQ 0 FORVHG V\PEROVf DQG 0 RSHQ V\PEROVf &D&, 1RUERUQH VRLO FROXPQV

PAGE 63

FROXPQ P/Jf DQG 0 &D&, FROXPQ P/Jf ,Q FRQWUDVW LRQLF FRQFHQWUDWLRQ PRODULW\f RI EDFNJURXQG PDWUL[ KDG PLQLPDO LPSDFW RQ TXLQROLQH VRUSWLRQ DW S+ )LJXUH f 7KH S+ RI WKH 0 &D&/ FROXPQ LV DQG WKH S+ RI WKH 0 &D&, FROXPQ LV 7KH IUDFWLRQ RI SURWRQDWHG VSHFLHV LV JUHDWHU DW S+ bf YHUVXV S+ bf 7KH GHFUHDVH LQ S+ LQ WKH ORZHU EDFNJURXQG PDWUL[ FRQFHQWUDWLRQ 0f FROXPQ PD\ FRPSHQVDWH IRU WKH GHFUHDVH LQ VRUSWLRQ GXH WR KLJKHU LRQLF FRQFHQWUDWLRQ %DWFK VWXGLHV DW S+ IRU 0 &D&, DQG LQ S+ IRU 0 &D&, VXJJHVW WKDW VRUSWLRQ .Gf LV JUHDWHU mbf DV WKH PRODULW\ RI WKH EDFNJURXQG PDWUL[ VROXWLRQ GHFUHDVHV &KDUJH FRPSHQVDWLRQ LQ WKH GLIIXVH GRXEOH OD\HU DW KLJKHU HOHFWURO\WH FRQFHQWUDWLRQV PD\ UHGXFH WKH VRUSWLRQ RI TXLQROLQH ,Q D VXEVRLO ZLWK D S+ WKH HIIHFWV RI LRQLF VWUHQJWK RQ TXLQROLQH VRUSWLRQ ZHUH QHJOLJLEOH =DFKDUD HW DO f 7KH LQIOXHQFH RI S+ LV HYLGHQW XSRQ FRPSDULQJ WKH %7&V LQ )LJXUH DQG DW WKH VDPH EDFNJURXQG HOHFWURO\WH FRQFHQWUDWLRQV $ GHFUHDVH LQ S+ UHVXOWV LQ D LQFUHDVH LQ TXLQROLQH VRUSWLRQ ,QFUHDVHG VRUSWLRQ DW ORZHU S+ YDOXHV LV H[SHFWHG EDVHG RQ WKH LQFUHDVH LQ WKH IUDFWLRQ RI 4+ 7KH LQIOXHQFH RI EDFNJURXQG HOHFWURO\WH FRQFHQWUDWLRQ ZDV QRW FOHDUO\ GHWHUPLQHG 3UHYLRXV LQYHVWLJDWLRQ VXJJHVWHG WKDW VRUSWLRQ GHFUHDVHG b DW S+ YDOXHV QHDU LWV S.J ZKHQ WKH LRQLF VWUHQJWK LQFUHDVHG IURP WR 0 &D&, +HOP\ HW DO =DFKDUD HW DO f

PAGE 64

5HODWLYH &RQFHQWUDWLRQ &&3RUH 9ROXPHV Sf )LJXUH 4XLQROLQH EUHDNWKURXJK FXUYHV LQ 0 FORVHG V\PEROVf DQG 0 &D&, RSHQ V\PEROVf LQ S+ DGMXVWHG 1RUERUQH VRLO FROXPQV

PAGE 65

0HDVXULQJ WKH LQIOXHQFH RI EDFNJURXQG HOHFWURO\WH FRQFHQWUDWLRQ RQ TXLQROLQH ZDV FRQIRXQGHG E\ D VLPXOWDQHRXV FKDQJH LQ HOHFWURO\WH FRQFHQWUDWLRQ DQG S+ )LJXUH f 3RLVLQJ WKH VRLO S+ DW VRPH YDOXH RWKHU WKDQ WKH QDWXUDO S+ LV RIWHQ GLIILFXOW 5HSHDWHG IOXVKLQJ RI WKH VRLO FROXPQ ZLWK 0 &D&, UHVXOWHG LQ D S+ m 7KH ILQDO S+ DIWHU IOXVKLQJ WKH VRLO FROXPQ ZLWK 0 &D&, UDQJHG IURP WR GHFUHDVLQJ WKH S+ DERXW S+ XQLWV $V WKH S+ RI WKH VRLO DSSURDFKHV WKH S.D RI WKH FRPSRXQG RI LQWHUHVW VRUSWLRQ LV LQFUHDVLQJO\ VHQVLWLYH WR VOLJKW S+ FKDQJHV )LJXUH f 7KHUHIRUH VRUSWLRQ PHDVXUHPHQWV RI LRQL]DEOH FRPSRXQGV PXVW EH FRQGXFWHG DW D FRQVWDQW S+ 7KH XVH RI QXWULHQW VROXWLRQV ZDV VKRZQ WR DOWHU WKH VRUSWLRQ RI TXLQROLQH 0F%ULGH HW DO f $V D UHVXOW XVH RI EXIIHUV ZDV DYRLGHG 7R DOWHU WKH VRLO S+ +&, PD\ EH DGGHG WR WKH V\VWHP 7KH DGGLWLRQ RI RWKHU LRQV PD\ FKDQJH WKH RYHUDOO LRQLF VWUHQJWK DQG WKH FDWLRQ H[FKDQJH FRPSOH[ WKHUHE\ LQIOXHQFLQJ TXLQROLQH VRUSWLRQ DQG SRVVLEO\ WKH SK\OORVLOLFDWH PLQHUDO VWUXFWXUH $ WLWUDWLRQ GHYLFH ZDV XVHG WR PDLQWDLQ D FRQVWDQW S+ RI VRLOVXVSHQVLRQV ZKLOH TXLQROLQH VRUSWLRQ ZDV PHDVXUHG =DFKDUD HW DO f +RZHYHU WKLV SURFHGXUH GRHV QRW OHQG LWVHOI WR XVH LQ IORZWKURXJK FROXPQ WHFKQLTXHV ,Q WKHVH FROXPQ H[SHULPHQWV DW WKH ORZHU S+ YDOXHV WKH EDFNJURXQG HOHFWURO\WH VROXWLRQ ZDV DGMXVWHG ZLWK +&, DQG IOXVKHG XQWLO WKH S+ ZDV HVVHQWLDOO\ FRQVWDQW s S+ XQLWVf 6RLO FROXPQV ZHUH IOXVKHG DW P/PLQ IRU DERXW ZHHNV $GGLWLRQDO DFLG ZDV QRW DGGHG WR DGMXVW WKH S+ RI WKH TXLQROLQH VROXWLRQ GXH WR FKDQJHV LQ

PAGE 66

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f ZDV HYDOXDWHG E\ H[DPLQLQJ WKH G\QDPLFV RI &D&D LVRWRSLF H[FKDQJH DQG H[FKDQJH RI TXLQROLQH IRU &D 7KH &D %7& ZDV V\PPHWULFDO DQG VKRZHG DERXW D b GURS LQ FRQFHQWUDWLRQ DIWHU DQ KRXU IORZ LQWHUUXSWLRQ LQ WKH DQG 0 &D&, FROXPQV )LJXUH f 7KLV VXJJHVWV WKDW FDWLRQ H[FKDQJH DQG GLIIXVLRQ LQWR FOD\ LQWHUOD\HU VLWHV DQG RUJDQLF PDWWHU UHJLRQV ZDV UDSLG DQG WKDW QHDU HTXLOLEULXP FRQGLWLRQV ZHUH DWWDLQHG XQGHU IORZ FRQGLWLRQV IRU WKH FROXPQ )ORZ LQWHUUXSWLRQV VXJJHVWHG WKDW PLJUDWLRQ RI &D LQWR LQWHUOD\HU VLWHV DQG RUJDQLF PDWWHU PDWULFHV ZDV QRW OLPLWLQJ PDVV WUDQVIHU RU LVRWRSLF H[FKDQJH NLQHWLFV 6]HFVRG\ DQG 6WUHLOH f DOVR IRXQG LVRWRSLF H[FKDQJH RI &DR&D WR EH UDSLG LQ FROXPQV SDFNHG ZLWK FOD\PRGLILHG DOXPLQD ([FKDQJH RI &D&D LQ RUJDQLF PDWWHU ZDV UDSLG DQG QRW OLPLWHG E\ PDVV WUDQVIHU LQWR WKH RUJDQLF PDWUL[ 1NHGL .L]]D HW DO f 7KH\ VSHFXODWHG WKDW WKH FRPSHQVDWLRQ RI FKDUJH PD\ RFFXU DW WKH H[WHULRU RI WKH RUJDQLF PDWWHU PDWUL[ DQG &D GRHV QRW QHFHVVDULO\ QHHG WR PLJUDWH ZLWKLQ WKH VRUEHQW

PAGE 67

&RQVLGHUDEOH DV\PPHWU\ RI WKH TXLQROLQH %7& DW m S+ LQ WKH VWHULOH 1RUERUQH VRLO DQG 0 &D&,f LV LQGLFDWLYH RI QRQHTXLOLEULXP EHKDYLRU GXULQJ GLVSODFHPHQW RI TXLQROLQH IRU &D )LJXUH f $ ODUJH GURS LQ HIIOXHQW FRQFHQWUDWLRQ } WR bf GXULQJ WKH IORZ LQWHUUXSWLRQV JUHDWHU WKDQ KRXUV LQGLFDWHV VWURQJ QRQHTXLOLEULXP EHKDYLRU %UXVVHDX HW DO f )LJXUH VKRZV WKH QRQHTXLOLEULXP EHKDYLRU XSRQ UHSHDWHG IORZ LQWHUUXSWLRQV LQ WKH 0 &D&, 1RUERUQH VRLO FROXPQ DW S+ 7KH ILUVW IORZ LQWHUUXSWLRQ DW KRXUVf UHVXOWV LQ D b GURS LQ FRQFHQWUDWLRQ 6XEVHTXHQW IORZ LQWHUUXSWLRQV KRXUVf VXJJHVWHG WKDW TXLQROLQH VRUSWLRQ LV UDWHOLPLWHG LQWR LQWHUOD\HU SRVLWLRQV RI SK\OORVLOLFDWH PLQHUDOV DQG SRVVLEO\ LQWR LQWHULRU UHJLRQV RI RUJDQLF PDWWHU PDWULFHV 6\PPHWULFDO %7&V IRU 3)%$ DQG + SUHFOXGH SK\VLFDO QRQHTXLOLEULXP FRQVWUDLQWV HJ PRELOHLPPRELOH ZDWHUf DV D SRVVLEOH UHDVRQ DQG &D FDWLRQ H[FKDQJH ZDV UDSLG 7KHUHIRUH TXLQROLQH VRUSWLRQ QRQHTXLOLEULXP PXVW EH GXH WR RWKHU FRQVWUDLQWV 2f/RXJKOLQ HW DO f UHSRUWHG WKDW VRUSWLRQ RI D 1KHWHURF\FOLF FRPSRXQG PHWK\O S\ULGLQHf LQWR FOD\ LQWHUOD\HUV ZDV UDWHOLPLWHG ZKHUHDV VRUSWLRQ RQWR HGJHVLWHV RI NDROLQLWH ZDV UDSLG ZKLFK VXJJHVWV WKDW VWHULF KLQGUDQFHV DUH OLPLWLQJ VRUSWLRQ +RZHYHU VLPLODU PROHFXODU GLPHQVLRQV RI TXLQROLQH QP ; QP [ QP :HDVW f DQG K\GUDWHG &D QP %RKQ HW DO f VXJJHVW WKDW VL]H FRQVLGHUDWLRQV DORQH DUH QRW OLNHO\ WR DFFRXQW IRU WKH REVHUYHG VRUSWLRQ QRQHTXLOLEULXP RI TXLQROLQH 6]HFVRG\ DQG

PAGE 68

5HODWLYH &RQFHQWUDWLRQ &4Mf )LJXUH 5HSHDWHG IORZ LQWHUUXSWLRQV IRU TXLQROLQH LQ D 0 &D&, S+ f 1RUERUQH VRLO FROXPQ DQG ELFRQWLQXXP PRGHO ILW

PAGE 69

6WUHLOH f DWWULEXWHG VRUSWLRQ QRQHTXLOLEULXP WR NLQHWLF FRQVWUDLQWV IURP VLWH VSHFLILF FKHPLFDO SURFHVVHV EHWZHHQ WKH TXLQROLQH DQG PRQWPRULOORQLWH 2YHU WKH FRQFHQWUDWLRQ UDQJH XVHG LQ WKLV VWXG\ WKH SURWRQDWHG IRUP LV OLNHO\ WKH SUHGRPLQDWH VSHFLHV VRUEHG YLD FDWLRQ H[FKDQJH ,Q WKH EXON VROXWLRQ RI WKH VRLO FROXPQV TXLQROLQH H[LVWV HVVHQWLDOO\ LQ WKH QHXWUDO IRUP =DFKDUD HW DO f GHPRQVWUDWHG WKDW HYHQ ZKHQ S+ YDOXHV DUH S+ D S.D f DQG PRVW RI TXLQROLQH H[LVWV LQ LWV QHXWUDO IRUP WKH TXLQROLQLXP LRQ LV VWLOO WKH SUHGRPLQDQW IRUP VRUEHG ,Q DGGLWLRQ VXUIDFHV FDQ EH XS WR XQLWV ORZHU LQ S+ WKDQ WKH EXON VROXWLRQ S+ %DWHV f DQG SURWRQDWLRQ UHDFWLRQV DUH UDSLG 7KHUHIRUH DYDLODELOLW\ RI TXLQROLQLXP LRQV LQ VROXWLRQV LV QRW OLNHO\ WR OLPLW VRUSWLRQ 7KH ELFRQWLQXXP PRGHO SURYLGHG DQ LQDGHTXDWH GHVFULSWLRQ RI TXLQROLQH EHKDYLRU LQ 1RUERUQH VRLO FROXPQV )LJXUH f 7KH IURQWDO SRUWLRQ RI WKH FXUYH DGHTXDWHO\ GHVFULEHV WKH UDSLG DFFHVV WR WKH HDVLO\ DFFHVVLEOH H[WHUQDO VLWHV 1RQOLQHDULW\ RI WKH TXLQROLQH VRUSWLRQ DOVR FDXVHG VHOI VKDUSHQLQJ RI WKH IURQW RI WKH %7& 7KH PRGHO ILWV ZHUH RSWLPL]HG IRU QRQHTXLOLEULXP SDUDPHWHUV DQG WR 7DEOH f DQG DUH VKRZQ LQ )LJXUH 7KH TXLQROLQH GLVSODFHPHQW LQ WKH FROXPQ DGMXVWHG WR S+ ZDV FRQGXFWHG DW P/PLQ ZKHUHDV GLVSODFHPHQW VWXGLHV LQ WKH RWKHU WKUHH FROXPQV OLVWHG LQ WKH 7DEOH ZHUH FRQGXFWHG DW m P/PLQ 7KH 1RUERUQH VRLO KDV b RUJDQLF PDWWHU LQ DGGLWLRQ WR VPHFWLWH FOD\ PLQHUDOV 7KH ODUJH IUDFWLRQ f RI VLWHV LQVWDQWDQHRXVO\ DFFHVVHG E\ TXLQROLQH ZDV DWWULEXWHG WR VRUSWLRQ RQ HGJH VLWHV DV PXFK DV bf DQG HDVLO\ DFFHVVLEOH LQWHUODPHOODU VLWHV RI VPHFWLWH PLQHUDOV

PAGE 70

7DEOH 6XPPDU\ RI HVWLPDWHG WUDQVSRUW SDUDPHWHUV IRU TXLQROLQH ,' S+ 5 .I &2 ) N %4 fr f )ORLQW f f S+ f f %4 f f %4 f f '&0$ ff f r YDOXHV LQ SDUHQWKHVLV DUH b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f OLNHO\ OLPLW GHVRUSWLRQ DQG VWHULF KLQGUDQFHV PD\ OLPLW UHGLVWULEXWLRQ ZLWKLQ SK\OORVLOLFDWH PLQHUDOV 7KH PROHFXODU FRQILJXUDWLRQ ZDV VXJJHVWHG WR FKDQJH IURP DQ XSULJKW SRVLWLRQ WR D SODQDU SRVLWLRQ ZLWKLQ FOD\ PLQHUDOV =DFKDUD HW D f $V D UHVXOW GHVRUSWLRQ LV VWURQJO\ LQKLELWHG GXH WR GHORFDOL]DWLRQ RI FKDUJH RYHU WKH HQWLUH PROHFXODU VXUIDFH 6XEVHTXHQW PLJUDWLRQ ZLWKLQ LQWHUODPHOODU UHJLRQV PD\ EH UHVWULFWHG GXH WR GHVRUSWLRQ DQG

PAGE 71

UHGLVWULEXWLRQ RI WKH TXLQROLQH PROHFXOH DQG OLPLWHG DFFHVVLELOLW\ GXH VWHULF WR KLQGUDQFHV 7KH VLJQLILFDQFH RI WKH LQWHUOD\HU VSDFLQJ LQ WKLV VPHFWLWH FOD\ PLQHUDO GXULQJ TXLQROLQH VRUSWLRQ LV DSSDUHQW JLYHQ WKDW WKH PDMRULW\ XS WR bf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b UHODWLYH KXPLGLW\ DQG WKH G VSDFLQJ ZDV PHDVXUHG 6XIILFLHQW TXLQROLQH ZDV WKHQ DGGHG WR WKH FOD\ WLOH WR RFFXS\ b RI WKH WRWDO VLWHV 0HDVXUHPHQWV RI WKH GVSDFLQJ ZHUH UHSHDWHG DW DQG b UHODWLYH KXPLGLW\ $ GHFUHDVH LQ WKH GVSDFLQJ XSRQ DGGLWLRQ RI TXLQROLQH ZRXOG LQGLFDWH WKH FROODSVH RI WKH FOD\ LQWHUOD\HUV DQG D SRWHQWLDO VRXUFH RI QRQHTXLOLEULXP VRUSWLRQ 1R REYLRXV FKDQJHV LQ GVSDFLQJ ZHUH LQGLFDWHG LQ WKH b TXLQROLQH VDWXUDWHG VDPSOHV FRPSDUHG WR WKH &D VDWXUDWHG VDPSOHV DW HLWKHU UHODWLYH KXPLGLW\ $ GHFUHDVH LQ WKH GVSDFLQJ ZDV GHWHFWHG XSRQ GHFUHDVLQJ WKH UHODWLYH KXPLGLW\ 7KH G VSDFLQJ ZDV QP DW b UHODWLYH KXPLGLW\ RI ZKLFK

PAGE 72

QP LV RFFXSLHG E\ DQ RFWDKHGUDO DQG WHWUDKHGUDO OD\HU 7KHUHIRUH WKH LQWHUODPHOODU UHJLRQ LV DSSUR[LPDWHO\ QP 7KLV SURFHGXUH ZDV OLPLWHG E\ WKH IDFW WKDW RQO\ b RI WKH WRWDO &(& VLWHV ZHUH RFFXSLHG E\ TXLQROLQH b RI WKH H[FKDQJH VLWHV ZHUH RFFXSLHG E\ &D 7KHUHIRUH QR FKDQJHV ZHUH GHWHFWHG 7R HQDEOH WKH GHWHFWLRQ RI G VSDFLQJ FKDQJHV D ODUJHU IUDFWLRQ RI VLWHV ZRXOG QHHG WR EH VDWXUDWHG ZLWK TXLQROLQH +RZHYHU VDWXUDWLQJ WKH H[FKDQJH FRPSOH[ ZLWK TXLQROLQH ZRXOG OLNHO\ DOWHU WKH VRUSWLRQ PHFKDQLVP DQG ZRXOG QRW EH FRPSDUDEOH WR ORZ TXLQROLQH FRQFHQWUDWLRQV VHH )LJXUH f )LJXUH FRQFHSWXDOL]HV WKH SURFHVV K\SRWKHVL]HG IRU TXLQROLQH VRUSWLRQ RQWR VPHFWLWH FOD\ PLQHUDOV 7KH VL]H RI WKH LQWHUOD\HU VSDFLQJ RI WKH VPHFWLWH FOD\ WKH &D DQG TXLQROLQH DUH DSSUR[LPDWHO\ GUDZQ WR VFDOH 4XLQROLQH UHSODFHV &D RQ HGJH DQG UHDGLO\ DFFHVVLEOH LQWHUOD\HU &(& VLWHV )LJXUH Df UHSUHVHQWLQJ WKH IUDFWLRQ RI LQVWDQWDQHRXV VLWHV )f DVVRFLDWHG ZLWK WKH FOD\ PLQHUDOV $IWHU WKLV LQLWLDO VWHS TXLQROLQH PXVW GHVRUE DQG PLJUDWH IXUWKHU ZLWKLQ WKH LQWHUODPHOODU UHJLRQ RI WKH FOD\ PLQHUDO 'LVSODFHPHQW RI &D E\ TXLQROLQH LQ LQWHUOD\HU UHJLRQV PD\ EH SK\VLFDOO\ FRQVWUDLQHG )LJXUH Df ZKLFK PD\ FRQWULEXWH WR VRUSWLRQ QRQHTXLOLEULXP &D LV K\GUDWHG DQG LQLWLDOO\ RFFXSLHV &(& VLWHV LQ WKH LQWHUOD\HU SRVLWLRQV 6PLWK HW DO f VXJJHVWHG WKDW TXLQROLQH GLVSODFHG LQWHUVWLWLDO ZDWHU XSRQ UHRULHQWDWLRQ WR D SODQDU SRVLWLRQ RQ WKH VXUIDFH 7KHUHIRUH WKH K\GUDWLRQ HQHUJLHV DVVRFLDWHG ZLWK TXLQROLQH DQG &D PD\ EH LPSRUWDQW LQ XQGHUVWDQGLQJ UDWHOLPLWDWLRQV RI TXLQROLQH VRUSWLRQ

PAGE 73

QP 6RUSWLRQ RQWR UHDGLO\ DFFHVVLEOH VLWHV )LJXUH &RQFHSWXDO GLDJUDP RI TXLQROLQH VRUSWLRQ RQWR VPHFWLWH FOD\ PLQHUDOV

PAGE 74

4XLQROLQH PD\ DOVR EH GUDZQ LQWR D SODQDU RULHQWDWLRQ )LJXUH 2Ef GHORFDOL]LQJ WKH FKDUJH RYHU WKH ZKROH TXLQROLQH PROHFXOH $W WKLV VWDJH TXLQROLQH PROHFXOHV LQ WKH VROXWLRQ SKDVH PD\ SDVV IXUWKHU LQWR WKH LQWHUODPHOODU UHJLRQV RI WKH FOD\ PLQHUDO GXH WR FRPSHQVDWLRQ RI WKH HOHFWURVWDWLF FKDUJH E\ WKH SUHYLRXVO\ VRUEHG TXLQROLQH PROHFXOH )LJXUH 2Ff 6RPH RI WKHVH VLWHV PD\ HVVHQWLDOO\ EH LQDFFHVVLEOH RQFH TXLQROLQH KDV RFFXSLHG WKH LQWHULRU RI FOD\ PLQHUDOV DQG IRUPHG D VWDEOH VXUIDFH FRPSOH[ $IWHU EUHDNWKURXJK DQG ZDVKRXW RI TXLQROLQH IURP WKH 1RUERUQH VRLO FROXPQV PDVV EDODQFH VXJJHVWHG WKDW WR b RI WKH TXLQROLQH LQWURGXFHG LQWR WKH FROXPQ UHPDLQHG RQ WKH VRLO 5HSHDWHG ZDVKLQJ ZLWK b PHWKDQRO ZDV LQVXIILFLHQW WR FRPSOHWHO\ ZDVK RXW UHVLGXDO TXLQROLQH ZLWKLQ WKH LQWHULRU FOD\ DJJUHJDWHV ,QWURGXFWLRQ RI D FDWLRQ PRUH VHOHFWLYH IRU WKH H[FKDQJH FRPSOH[ WKDQ TXLQROLQH ZRXOG EH D PRUH HIILFLHQW PHWKRG IRU UHPRYLQJ TXLQROLQH IURP WKH H[FKDQJH FRPSOH[ 7KH LQDELOLW\ WR VXFFHVVIXOO\ UHPRYH UHVLGXDO TXLQROLQH IURP LQWHUOD\HU SRVLWLRQV IXUWKHU VXSSRUWV WKDW VWURQJ TXLQROLQH VXUIDFH FRPSOH[HV DUH IRUPHG RU WKDW WKH LQWHUOD\HUV KDYH FROODSVHG )LJXUH 2Gf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

PAGE 75

,VRWRSLF H[FKDQJH RI &TXLQROLQH&TXLQROLQH ZDV PHDVXUHG WR GHWHUPLQH WKH H[FKDQJH RI TXLQROLQH PROHFXOHV GXULQJ GLVSODFHPHQW ZLWK 0 &D&, LQ D 1RUERUQH VRLO FROXPQ )LJXUH f 7KH EUHDNWKURXJK RI TXLQROLQH ZDV ILUVW PRQLWRUHG LQ D 0 &D&, EDFNJURXQG PDWUL[ VROXWLRQ $IWHU IORZ LQWHUUXSWLRQV VKRZQ LQ )LJXUH f WKH HTXLOLEULXP VROXWLRQ FRQFHQWUDWLRQ ZDV b RI WKH LQIOXHQW FRQFHQWUDWLRQ $W WKLV SRLQW D VROXWLRQ RI &TXLQROLQH DQG &TXLQROLQH VDPH WRWDO FRQFHQWUDWLRQf LQ 0 &D&, ZDV LQWURGXFHG LQWR WKH FROXPQ 7KH EUHDNWKURXJK RI &TXLQROLQH ZDV GHOD\HG IROORZLQJ SUHFRQGLWLRQLQJ ZLWK &TXLQROLQH DQG WKH GURS LQ UHODWLYH FRQFHQWUDWLRQ b YHUVXV bf GXULQJ IORZ LQWHUUXSWLRQ GHFUHDVHG $SSDUHQW LQFUHDVHG UHWHQWLRQ GHOD\HG EUHDNWKURXJKf LQ WKH &TXLQROLQH FROXPQ PD\ KDYH EHHQ FDXVHG E\ GHFUHDVHG S+ f +RZHYHU WKH FKDQJH LQ S+ FDXVHV DERXW D b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f ,Q IDFW EUHDNWKURXJK ZDV GHOD\HG WKHUHIRUH WKLV ZDV UHDVRQHG QRW WR EH D YLDEOH RSWLRQ

PAGE 76

5HODWLYH &RQFHQWUDWLRQ &&A k MG R A 2 r p kk R2 r R k R k R R 2 k R k &8 k D" &2 p m R &0 2 2 R R k Rp R &4XLQROLQH k &4XLQROLQH 3RUH 9ROXPHV Sf )LJXUH ,VRWRSLF H[FKDQJH RI &TXLQROLQH DQG &TXLQROLQH LQ 0 &D&, S+ f LQ WKH 1RUERUQH VRLO

PAGE 77

$QRWKHU SRVVLELOLW\ LV WKDW WKH &TXLQROLQH DSSURDFKHV HTXLOLEULXP PRUH UDSLGO\ WKDQ WKH &TXLQROLQH 7KH VLJPRLGDO VKDSH RI WKH %7& IRU & TXLQROLQH LV LQGLFDWLYH RI HTXLOLEULXP VRUSWLRQ DQG D OLQHDU LVRWKHUP LV H[SHFWHG IURP H[FKDQJH RI & DQG &TXLQROLQH 4XLQROLQH VRUSWLRQ LVRWKHUPV ZHUH QRQOLQHDU Qm LQ EDWFK V\VWHPV XSRQ H[FKDQJH RI TXLQROLQH IRU A&D 7KH VHOIVKDUSHQLQJ IURQW IRU WKH &TXLQROLQH %7& LV LQGLFDWLYH RI QRQOLQHDU VRUSWLRQ %UXVVHDX DQG 5DR Ef 7KH VKDUS IURQW PD\ DOVR LQGLFDWH QRQHTXLOLEULXP FRQGLWLRQV VXJJHVWLQJ DFFHVV LQWR WKH LQWHUOD\HU SRVLWLRQV DQG UHSODFHPHQW RI FDOFLXP LV GLIILFXOW ,QLWLDO DFFHVV RI TXLQROLQH LQWR LQWHUOD\HU SRVLWLRQV PD\ HQKDQFH VXEVHTXHQW DFFHVV RI LQWHUOD\HU UHJLRQV GXH WR FKDUJH FRPSHQVDWLRQ DQG UHRULHQWDWLRQ )LJXUH 2Ff 7R WHVW WKLV K\SRWKHVLV D %7& RI & TXLQROLQH RQ WKH EDFNVLGH WDLO b UHVLGXDO TXLQROLQHf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f VXJJHVWHG WKDW TXLQROLQH VRUSWLRQ LV QHDU HTXLOLEULXP +RZHYHU WKH UHODWLYH FRQFHQWUDWLRQ RQO\ UHDFKHV

PAGE 78

b DIWHU WKH IORZ ,QWHUUXSWLRQ ,Q WKH S+ FROXPQ && DSSURDFKHG UDSLGO\ DIWHU WKH IORZ ,QWHUUXSWLRQ ,Q WKH S+ DQG FROXPQV WKH IORZ ,QWHUUXSWLRQ UHVXOWHG LQ D DQG b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f DQG WKH DELOLW\ RI TXLQROLQH WR GHORFDOL]H ,WV FKDUJH RYHU WKH HQWLUH VXUIDFH RI WKH FRPSRXQG =DFKDUD HW DO f 5HSODFHPHQW RI K\GURJHQ LRQV IRU &D RQ H[FKDQJH VLWHV PD\ DOWHU WKH FOD\ ,QWHUOD\HU HQYLURQPHQW WKXV TXLQROLQH PLJUDWLRQ ,QWR ,QWHUOD\HUV $V D UHVXOW WKH DELOLW\ WR DFFHVV ,QWHUOD\HU SRVLWLRQV DV WKH S+ GHFUHDVHV PD\ EH IXUWKHU FRQVWUDLQHG ,W PD\ EH SRVVLEOH WKDW PDVV WUDQVIHU ,V UHVWULFWHG EH\RQG WKH WLPH DOORZHG IRU IORZ ,QWHUUXSWLRQ K S+ FROXPQf PRGHOLQJ WKH GDWD DVVXPLQJ IORZ LQWHUUXSWLRQ RFFXUUHG IRU D ORQJHU SHULRG RI WLPH Gf ZRXOG UHVXOW ,Q D ODUJH GURS GXULQJ IORZ LQWHUUXSWLRQ 7KH PRGHO ILW JUDQWHG WKH HUURU DVVRFLDWHG ZLWK WKH XVH RI WKLV PRGHOf VXJJHVWV WKDW PDVV WUDQVIHU ,V PRUH FRQVWUDLQHG WKDQ ,QGLFDWHG IRU WKH KRXU IORZ LQWHUUXSWLRQ +RZHYHU D IORZ LQWHUUXSWLRQ IRU DV PXFK DV GD\V LQ D S+ FROXPQ UHVXOWHG ,Q RQO\ DQ b

PAGE 79

GURS LQ WKH UHODWLYH FRQFHQWUDWLRQ DQG DSSURDFKHG D UHODWLYH FRQFHQWUDWLRQ RI b 7KH N YDOXHV GHWHUPLQHG IURP PRGHO ILWV IRU WKH ORZHU S+ FROXPQV DUH OHVV WKDQ WKH KLJKHU S+ FROXPQV 7DEOH f 6RUSWLRQ LV DERXW WLPHV IDVWHU DW KLJKHU S+ YDOXHV WKDQ LQ ORZHU S+ VRLOV 7KH WUHQG LQGLFDWHV UHGXFHG DFFHVV WR LQWHUOD\HU SRVLWLRQV DV S+ GHFUHDVHV &RQVLGHUDWLRQ PXVW EH JLYHQ WR GLIIHUHQFHV LQ WKH QDWXUH RI RUJDQLF PDWWHU YHUVXV FOD\ PLQHUDOV LQ GHVFULELQJ WKH TXLQROLQH VRUSWLRQ 'LIIXVLRQ RI TXLQROLQH LQWR LQWHUODPHOODU UHJLRQV ZDV VXJJHVWHG WR EH UDWHOLPLWHG +RZHYHU VRUSWLRQ RI TXLQROLQH LQWR RUJDQLF PDWWHU PDWULFHV ZDV QRW FOHDUO\ GHILQHG LQ WKH 1RUERUQH VRLO GXH WR WKH SUHVHQFH RI VPHFWLWH FOD\ PLQHUDOV 7KHUHIRUH FROXPQ VWXGLHV ZHUH FRQGXFWHG RQ D (XVWLV VRLO ZKHUH D PDMRULW\ RI WKH &(& LV ORFDWHG LQ WKH RUJDQLF IUDFWLRQ RI WKH VRLO DQG WKH UHPDLQGHU DUH DVVRFLDWHG ZLWK WKH NDROLQLWLF FOD\ PLQHUDOV $ ODUJH GURS LQ HIIOXHQW FRQFHQWUDWLRQ mbf GXULQJ WKH KU IORZ LQWHUUXSWLRQ LQ WKH (XVWLV VRLO FROXPQ LV LQGLFDWLYH RI QRQHTXLOLEULXP VRUSWLRQ LQWR RUJDQLF PDWWHU PDWULFHV )LJXUH f ,W ZDV VXJJHVWHG WKDW VRUSWLRQ RI WKH QHXWUDO VSHFLHV EHKDYHG VLPLODUO\ WR +2&V ,20'f ZKLOH VRUSWLRQ RI WKH TXLQROLQLXP LRQ RQWR H[WHULRU UHJLRQV RI RUJDQLF PDWWHU ZDV UDSLG FDWLRQ H[FKDQJHf %UXVVHDX HW DO f +RZHYHU IORZ LQWHUUXSWLRQ WHFKQLTXHV HQKDQFHG GHWHFWLRQ RI VRUSWLRQ QRQHTXLOLEULXP DQG VXJJHVWHG WKDW QRQHTXLOLEULXP FRQGLWLRQV SUHGRPLQDWHG LQ RUJDQLF PDWWHU PDWULFHV (XVWLV VRLOf DQG SK\OORVLOLFDWH PLQHUDOV 1RUERUQH VRLOf $FFHVV WR UDWHOLPLWHG VLWHV ZDV

PAGE 80

5HODWLYH &RQFHQWUDWLRQ &&f QR 2 F3 R R R R R R R R R R RR k k R R R R riF3 K )ORZ K ,QWHUUXSWLRQ p 1 &D&, R b 0HWKDQRO 3RUH 9ROXPHV Sf )LJXUH %UHDNWKURXJK FXUYHV RI TXLQROLQH LQ (XVWLV VRLO ZLWK 0 &D&, DQG b PHWKDQRO

PAGE 81

VXJJHVWHG WR EH IDVWHU LQWR WKH RUJDQLF PDWWHU PDWUL[ WKDQ LQWR WKH FOD\ PLQHUDOV 7DEOH f 2UJDQLF PDWWHU LV WKRXJKW WR EH D IOH[LEOH GHIRUPDEOH RUJDQLF SRO\PHU WKHUHIRUH PLJUDWLRQ LQWR WKLV W\SH RI PDWUL[ PD\ EH OHVV UHVWULFWHG WKDQ LQWR LQWHUODPHOODU UHJLRQV RI FOD\ PLQHUDOV 1RQHTXLOLEULXP GXH WR ,20' DULVHV GXH WR UHVWULFWHG GLIIXVLRQ ZLWKLQ WKH SRO\PHUOLNH PDWUL[ RI RUJDQLF PDWWHU %UXVVHDX HW D f 6SHFLILF LQWHUDFWLRQV RI TXLQROLQH ZLWK IXQFWLRQDO JURXSV RI RUJDQLF PDWWHU DUH OLNHO\ WR FKDQJH WKH QDWXUH RI WKLV IOH[LEOH RUJDQLF SRO\PHU 5HGLVWULEXWLRQ RI FKDUJH XSRQ PLJUDWLRQ RI TXLQROLQH ZLWKLQ WKH RUJDQLF PDWWHU PD\ FDXVH WKH PDWUL[ WR FROODSVH DURXQG WKH TXLQROLQH PROHFXOH DQG UHVWULFW GLIIXVLRQ %UXVVHDX HW DO f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f 7KH VWUXFWXUH LV FRPSRVHG RI UHJLRQV RI UDQGRPO\ GLVWULEXWHG K\GURSKRELF DQG K\GURSKLOLF UHJLRQV FRPSULVHG RI DURPDWLF DQG DOLSKDWLF VWUXFWXUHV UHVSHFWLYHO\ (QYLVLRQ TXLQROLQH PLJUDWLRQ LQWR WKLV RUJDQLF PDWUL[ VSHFLILF LQWHUDFWLRQV EHWZHHQ TXLQROLQH DQG K\GUR[\O JURXSV PD\ RFFXU

PAGE 82

)LJXUH 6WUXFWXUDO UHSUHVHQWDWLRQ RI RUJDQLF PDWWHU DGDSWHG IURP %KDU DQG 9DQGHQEURXFNH f

PAGE 83

IROORZHG E\ UHGLVWULEXWLRQ RI FKDUJH DQG UHFRQILJXUDWLRQ RI WKH PDWUL[ DURXQG WKH TXLQROLQH PROHFXOH 7KH K\GURSKRELF SRUWLRQ RI WKH PROHFXOH PD\ DVVRFLDWH DQG SDUWLWLRQ LQWR WKH DURPDWLF UHJLRQ $GGLWLRQ RI FRVROYHQWV LQFUHDVHV VROXELOLW\ RI RUJDQLF FRPSRXQGV DQG GHFUHDVHV VRUSWLRQ ,Q DGGLWLRQ WKH RUJDQLF PDWWHU PDWUL[ PD\ VZHOO LQFUHDVLQJ DFFHVVLELOLW\ WR WKH LQWHULRU RI WKH RUJDQLF PDWWHU PDWUL[ WKHUHE\ UHGXFLQJ VRUSWLRQ QRQHTXLOLEULXP 1NHGL.L]]D HW DO /HH HW DO f +RZHYHU WKH IUDFWLRQ RI LQVWDQWDQHRXV VLWHV )f GHFUHDVHG DV WKH PDWUL[ VZHOOHG EHFDXVH WKH VXUIDFH DUHD WR YROXPH UDWLR GHFUHDVHV /HH HW DO f 2WKHU VSHFLILF VROXWHVROYHQW DQG VROYHQWVRUEHQW LQWHUDFWLRQV LQFUHDVH WKH FRPSOH[LW\ RI GHVFULELQJ VRUSWLRQ RI LRQL]DEOH RUJDQLF FRPSRXQGV LQ PL[HG VROYHQWV V\VWHPV /HH HW DO f 7KH S.D RI DFLGLF IXQFWLRQDO JURXSV DVVRFLDWHG ZLWK WKH VRUEHQW PD\ LQFUHDVH XSRQ DGGLWLRQ RI VROYHQWV /HH HW DO f 7KXV LQ WKH SUHVHQFH RI VROYHQWV DW D JLYHQ S+ WKH IXQFWLRQDO JURXSV EHFRPH PRUH QHXWUDO DQG UHGXFH HOHFWURVWDWLF LQWHUDFWLRQV ,Q DGGLWLRQ WKH S.J RI WKH TXLQROLQH GHFUHDVHV XSRQ DGGLWLRQ RI FRVROYHQWV 7KHUHIRUH DW D JLYHQ S+ WKH DPRXQW RI QHXWUDO VSHFLHV SUHVHQW LQFUHDVHV 7KHVH VROYHQWVRUEHQW DQG VROXWHVROYHQW LQWHUDFWLRQV PD\ HQKDQFH WKH PLJUDWLRQ RI PROHFXOHV ZLWKLQ WKH PDWUL[ E\ LQFUHDVLQJ WKH SHUPHDELOLW\ DQG UHGXFLQJ VSHFLILF TXLQROLQHVRUEHQW LQWHUDFWLRQV WKHUHE\ UHGXFLQJ VRUSWLRQ QRQHTXLOLEULXP +RZHYHU WKH IUDFWLRQ RI LQVWDQWDQHRXV VLWHV PD\ GHFUHDVH $GGLWLRQ RI PHWKDQRO bf UHGXFHG TXLQROLQH VRUSWLRQ )LJXUH f 4XLQROLQH VROXELOLW\ LQFUHDVHV ZLWK LQFUHDVLQJ YROXPH IUDFWLRQ PHWKDQRO

PAGE 84

FRUUHVSRQGLQJ WR D GHFUHDVH LQ VRUSWLRQ XSRQ VROYHQW DGGLWLRQ )X DQG /XWK\ Df 7UDQVSRUW SDUDPHWHUV IRU WZR (XVWLV VRLO FROXPQV DUH SUHVHQWHG LQ 7DEOH &RVROYHQW HIIHFWV RQ VROXELOLW\ DQG VRUSWLRQ RI TXLQROLQH LV FRQIRXQGHG E\ VSHFLILF VROYHQWVRUEHQW DQG VROYHQWVROXWH LQWHUDFWLRQV 7KH VHOI VKDUSHQLQJ IURQW LV LQGLFDWLYH RI LVRWKHUP QRQOLQHDULW\ 6RUSWLRQ RI TXLQROLQH LQ XS WR b PHWKDQRO ZDV QRQOLQHDU =DFKDUD HW DO f +RZHYHU VRUSWLRQ LVRWKHUPV RI SHVWLFLGHV KDYH VKRZQ LQFUHDVHG OLQHDULW\ XSRQ DGGLWLRQ RI FRVROYHQWV 1NHGL.L]]D HW DO f 'LUHFW REVHUYDWLRQ RI WKH RUJDQLF PDWWHU VXUIDFHV ZDV DWWHPSWHG E\ WDNLQJ D VFDQQLQJ HOHFWURQ PLFURJUDSK 6(0f RI DQ RUJDQLF VRLO )LJXUH f 7KH VRLO ZDV GULHG DW r& DQG JROG FRDWHG WR SUHSDUH WKH VDPSOH 7KH VRLO ZDV QRW IL[HG ZLWK JOXWDUDOGHK\GH RU GHK\GUDWHG ZLWK VROYHQWV WR PLQLPL]H VWUXFWXUDO FKDQJHV GXH WR IL[DWLYH DJHQWV 7KH 6(0 VKRZV WKH KHWHURJHQHLW\ DVVRFLDWLRQ ZLWK WKH VXUIDFH RI RUJDQLF PDWWHU )LJXUH Df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

PAGE 85

D E )LJXUH 6FDQQLQJ HOHFWURQ PLFURJUDSK RI DQ RUJDQLF VRLO DW [ Df DQG [ Ef

PAGE 86

7KH 6(0 SKRWRJUDSK DOVR VKRZV IXQJDO VSRUHV WKDW KDYH EHHQ SUHVHUYHG ZLWKLQ WKLV RUJDQLF VRLO )XUWKHU LQYHVWLJDWLRQ RI WKH RUJDQLF PDWWHU VXUIDFH UHYHDOHG IXQJDO PDWV IRUPLQJ RQ WKH RUJDQLF PDWWHU VXUIDFH )LJXUH Ef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

PAGE 87

TXLQROLQH PLJUDWLRQ DQG UHGLVWULEXWLRQ LV UDWHOLPLWHG ,Q DGGLWLRQ VSHFLILF TXLQROLQHVRUEHQW LQWHUDFWLRQV UHRULHQWDWLRQ DQG FKDUJH GHORFDOL]DWLRQf OLPLW GHVRUSWLRQ IURP WKH VXUIDFH 2Q WKH RWKHU KDQG LI VRUSWLRQ RFFXUV RQWR D SUHFRQGLWLRQHG TXLQROLQH VRLO FRQWDLQLQJ SK\OORVLOLFDWH PLQHUDOV DFFHVV WR LQWHUOD\HU UHJLRQV PD\ EH HQKDQFHG GXH WR FRPSHQVDWLRQ RI FKDUJH E\ WKH SUHH[LVWLQJ TXLQROLQH 6RUSWLRQ ZLWKLQ RUJDQLF PDWWHU LV OLNHO\ OLPLWHG E\ VSHFLILF HOHFWURVWDWLF LQWHUDFWLRQV ZKLFK FDXVH UHFRQILJXUDWLRQ RI WKH RUJDQLFW\SH SRO\PHUV %RWK VRUEHQWV UHVWULFW PLJUDWLRQ LQWR LQWHULRU UHJLRQV FDXVLQJ UDWH OLPLWHG VRUSWLRQ 7KH ELRDYDLODELOLW\ RI TXLQROLQH VRUEHG ZLWKLQ HLWKHU VRUEHQW PDWUL[ LV OLNHO\ WR EH OLPLWHG $V LQGLFDWHG E\ UHSHDWHG ZDVKLQJ RI WKH 1RUERUQH VRLO WR b RI WKH VROXWH UHPDLQV VRUEHG 7KLV IUDFWLRQ LV WKHUHIRUH UHQGHUHG XQDYDLODEOH WR WKH PLFURRUJDQLVPV EDVHG RQ WKH ORFDWLRQ RI WKH VROXWH DQG WKH PLFURRUJDQLVP 6HH &KDSWHU IRU IXUWKHU GLVFXVVLRQf 7KH GLVWULEXWLRQ LV PLFURELDO ELRPDVV LQ WKH RUJDQLF VRLO )LJXUH f VXJJHVWHG WKDW PLFURELDO ELRPDVV PD\ SUROLIHUDWH DQG FRYHU WKH VRLO VXUIDFH 7KH DGGLWLRQ RI PLFURELDO ELRPDVV WR VRLOV DQG DTXLIHUV PD\ VXEVWDQWLDOO\ DOWHU WKH QDWXUH RI WKH VRUEHQW VXUIDFH )LJXUH f ,Q WKH DEVHQFH RI ELRGHJUDGDWLRQ WKH LPSDFW RI ELRPDVV RQ FRQWDPLQDQW VRUSWLRQ DQG WUDQVSRUW LV RI JUHDW LQWHUHVW

PAGE 88

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f 7KHUHIRUH WKH LPSDFW RI EDFWHULDO ELRPDVV RQ FRQWDPLQDQW EHKDYLRU LQ SRURXV PHGLD QHDU KD]DUGRXV ZDVWH VLWHV LV RI LQWHUHVW ,Q DGGLWLRQ WR FRQWDPLQDQW ELRGHJUDGDWLRQ DGGLWLRQ RI EDFWHULD WR SRURXV PHGLD PD\ UHVXOW LQ f EDFWHULDO JURZWK RU WUDQVSRUW WKURXJK WKH SRURXV PHGLD OHDGLQJ WR SRUH FORJJLQJ DV D UHVXOW RI SK\VLFDO VWUDLQLQJ f ELRVRUSWLRQ DQG EDFWHULDO PLJUDWLRQ IDFLOLWDWLQJ FRQWDPLQDQW WUDQVSRUW DQG f EDFWHULDO VRUSWLRQ RQWR VRLO VXUIDFHV DOWHULQJ WKH VRUSWLRQ FDSDFLW\ $OWKRXJK EDFWHULDO PLJUDWLRQ WKURXJK VDQG\ VRLOV DQG DTXLIHUV LV ZHOO GRFXPHQWHG ELRUHPHGLDWLRQ DWWHPSWV KDYH IDLOHG DPRQJ RWKHU UHDVRQV GXH WR WKH LQDELOLW\ RI LQMHFWHG EDFWHULD WR UHDFK FRQWDPLQDWHG VLWHV *LEVRQ DQG 6D\OHU f 3K\VLFDO FKHPLFDO DQG PLFURELDO IDFWRUV FRQWUROOLQJ EDFWHULDO WUDQVSRUW LQ SRURXV PHGLD KDYH UHFHQWO\ EHHQ

PAGE 89

VXPPDUL]HG +DUYH\ /LQGTYLVW DQG (QILHOG E 7DQ HW DO f %DFWHULDO WUDQVSRUW PD\ EH OLPLWHG E\ SK\VLFDO FRQVWUDLQWV LPSRVHG E\ WKH SRURXV PHGLD VXFK DV VRLO VWUXFWXUH DQG SRUH VL]H GLVWULEXWLRQ /LQGTYLVW DQG (QILHOG Ef 6WUDLQLQJ RU ILOWUDWLRQ RFFXUV LQ VRLOV DQG DTXLIHUV ZKHQ EDFWHULD DUH WRR ODUJH WR SDVV WKURXJK VRLO SRUHV WKLV UHVXOWV LQ SRUH FORJJLQJ ZKLFK UHVWULFWV IXUWKHU SHQHWUDWLRQ RI EDFWHULD +HU]LJ HW DO +DUYH\ f 2QFH EDFWHULD EHFRPH FORJJHG LQ WKH VRLO SRUHV ZDWHU IORZ LV DOVR UHVWULFWHG DQG WKH SDWK RI ZDWHU IORZ FDQ EH DOWHUHG 9DQGHYLYHUH DQG %DYH\H f &KHPLFDO FRQVWUDLQWV VXFK DV DGVRUSWLRQ RI EDFWHULD PD\ DOVR OLPLW EDFWHULDO PLJUDWLRQ WKURXJK VRLOV DQG DTXLIHUV +DUYH\ HW DO +DUYH\ %DOHV HW DO 7DQ HW DO f %DFWHULD WKDW DUH K\GURSKRELF DQG DUH PLQLPDOO\ FKDUJHG KDYH WKH JUHDWHVW SRWHQWLDO WR VRUE RQWR VXUIDFHV KRZHYHU PDQ\ RWKHU IDFWRUV PD\ LQIOXHQFH EDFWHULDO DWWDFKPHQW YDQ /RRVGUHFKW HW DO f %HFDXVH RI EDFWHULDO DGVRUSWLRQ E\ VRLOV 'DQLHOV f DQG FOD\ PLQHUDOV 6WRW]N\ DQG 5HP f WKH FRQWDPLQDQW VRUSWLRQ FDSDFLW\ RI WKH VRLO PD\ EH DOWHUHG %DFWHULD JURZ DIWHU WKH\ DWWDFK WR VXUIDFHV LI HVVHQWLDO FDUERQ DQG HQHUJ\ VRXUFHV DUH DYDLODEOH *URZWK DQG GHYHORSPHQW RI EDFWHULDO FRORQLHV JHQHUDOO\ FRLQFLGH ZLWK WKH SURGXFWLRQ RI H[WUDFHOOXODU SRO\VDFFKDULGHV DQG SURPRWH WKH IRUPDWLRQ RI EDFWHULDO ELRILOPV YDQ /RRVGUHFKW HW DO )OHWFKHU f %DFWHULDO ELRPDVV WKHUHIRUH FRQWDLQV OLYH DQG GHDG FHOOV DQG FHOO H[XGDWHV H[WUDFHOOXODU SRO\PHUVf 8QGHU QXWULHQW DQG VXEVWUDWHULFK FRQGLWLRQV DV PD\ EH WKH FDVH QHDU ZDVWHV VLWHV ELRILOP IRUPDWLRQ PD\ FUHDWH GLIIXVLRQDO EDUULHUV OHDGLQJ WR QRQHTXLOLEULXP

PAGE 90

VRUSWLRQ RI FRQWDPLQDQWV 7KLV LV JHQHUDOO\ WKH FDVH IRU ZDVWHZDWHU WUHDWPHQW E\ ILOWUDWLRQ WKURXJK DFWLYDWHG FDUERQ EHGV 6SHLWHO HW DO 5LWWPDQ DQG 0F&DUW\ f %DFWHULDO ELRPDVV PD\ SK\VLFDOO\ DOWHU WKH DFFHVVLELOLW\ RI VRUSWLRQ VLWHV WKHUHE\ UHGXFLQJ FRQWDPLQDQW VRUSWLRQ 7R IXUWKHU FRPSOLFDWH WKH SUREOHP EDFWHULDO ELRPDVV PD\ DFW DV DQ DGGLWLRQDO VRUEHQW WKHUHE\ LQFUHDVLQJ FRQWDPLQDQW VRUSWLRQ 6RUSWLRQ E\ YDULRXV PLFURRUJDQLVPV LQ DTXDWLF V\VWHPV KDV EHHQ VKRZQ IRU K\GURSKRELF RUJDQLF FKHPLFDOV +2&Vf %DXJKPDQ DQG 3DULV 7VH]RV DQG %HOO f PHWDOV 6FRWW DQG 3DOPHU f DQG RUJDQLF DPLQHV &ULVW HW DO f $ FRQVHQVXV RQ ELRVRUSWLRQ PHFKDQLVPV KDV QRW EHHQ UHDFKHG DQG XVXDOO\ QR GLVWLQFWLRQ LV PDGH EHWZHHQ VRUSWLRQ RQWR H[WUDFHOOXODU UHJLRQV DQG DEVRUSWLRQ LQWR WKH FHOOV 3URSHUWLHV VXFK DV DTXHRXV VROXELOLW\ DQG ORJ .RZ .RZ RFWDQRO ZDWHU SDUWLWLRQ FRHIILFLHQWf IRU WKH FRQWDPLQDQW 6HOYDNXPXU DQG +VLHK f DQG EDFWHULDO OLSLG FRQWHQW %LWWRQ HW DO f KDYH EHHQ FRUUHODWHG WR ELRVRUSWLRQ RI +2&V %LRVRUSWLRQ RI WUDFH PHWDOV KDV EHHQ VKRZQ WR RFFXU YLD DGVRUSWLRQ RQWR H[WUDFHOOXODU EDFWHULDO FDSVXOHV ZLWK PLQLPDO LQWUDFHOOXODU XSWDNH 6FRWW DQG 3DOPHU f 6RUSWLRQ RI RUJDQLF DPLQHV E\ DOJDH KDV DOVR EHHQ GHVFULEHG E\ PHFKDQLVPV LQFOXGLQJ LRQ H[FKDQJH DQG K\GURSKRELF ERQGLQJ &ULVW HW DO f 2FFXUUHQFH RI ELRVRUSWLRQ DQG EDFWHULDO PLJUDWLRQ UHJDUGOHVV RI WKH XQGHUO\LQJ PHFKDQLVPV VXJJHVWV WKH SRWHQWLDO IRU ELRIDFLOLWDWHG WUDQVSRUW RI FRQWDPLQDQWV /LQGTYLVW DQG (QILHOG Df GHPRQVWUDWHG EDFWHULDOIDFLOLWDWHG WUDQVSRUW RI WZR +2&V GLFKORURGLSKHQ\OWULFKORURHWKDQH DQG KH[DFKORUREHQ]HQHf

PAGE 91

LQ VDQG FROXPQV %LRVRUSWLRQ WHFKQRORJ\ KDV EHHQ FRPPHUFLDOL]HG WR PRELOL]H PHWDOV LQ WKH PLQLQJ LQGXVWU\ (KUOLFK DQG %ULHUOH\ f +RZHYHU ELRIDFLOLWDWHG WUDQVSRUW RI 1+&V EDVHV KDV \HW WR EH GHPRQVWUDWHG 5HVHDUFK 4XHVWLRQ DQG 7DVNV $W WKH ILHOG VFDOH WKH TXHVWLRQ RI LQWHUHVW LV ZKDW DUH WKH FRQVHTXHQFHV RI ELRHQKDQFHPHQW RU ELRDXJPHQWDWLRQ SUDFWLFHV LQ DWWHPSWV WR UHPHGLDWH FRQWDPLQDWHG VLWHV" 6SHFLILFDOO\ GR EDFWHULD DOWHU WKH VRUSWLRQ DQG WUDQVSRUW RI 1+&V" ,Q WKLV FKDSWHU H[DPLQH WKH LPSDFW RI EDFWHULDO ELRPDVV RQ WKH VRUSWLRQ DQG WUDQVSRUW RI WKUHH VROXWHV QDSKWKDOHQH &D DQG TXLQROLQHf LQ D VXEVXUIDFH VRLO 7KHVH FRPSRXQGV ZHUH VHOHFWHG EHFDXVH RI WKHLU NQRZQ VSHFLILF LQWHUDFWLRQV LQ VRLO f QDSKWKDOHQH ZDV VHOHFWHG WR SUREH K\GURSKRELF LQWHUDFWLRQV ZLWK WKH QRQSRODU RUJDQLF SKDVH f &D ZDV VHOHFWHG WR SUREH HOHFWURVWDWLF LQWHUDFWLRQV ZLWK WKH FDWLRQ H[FKDQJH VLWHV DQG f TXLQROLQH D 1 KHWHURF\FOLF RUJDQLF EDVH ZDV VHOHFWHG EHFDXVH LW FDQ H[LVW DV D QHXWUDO RUJDQLF FRPSRXQG LQWHUDFWLQJ ZLWK WKH RUJDQLF SKDVH RU DV D TXLQROLQLXP LRQ LQWHUDFWLQJ ZLWK FDWLRQ H[FKDQJH VLWHV 0LVFLEOH GLVSODFHPHQW WHFKQLTXHV ZHUH XVHG WR PHDVXUH VRUSWLRQ DQG WUDQVSRUW RI WKH DERYH FRPSRXQGV GXULQJ VWHDG\ VDWXUDWHG ZDWHU IORZ FRQGLWLRQV WKURXJK KRPRJHQHRXVO\SDFNHG VWHULOH RU EDFWHULDOLQRFXODWHG VRLO FROXPQV $ ILQHWH[WXUHG VLOW ORDP VRLO 1RUERUQH ILQHORDP\ PL[HG PHVLF 7\SLF $UJLXGROOf ZDV FKRVHQ IRU WKHVH H[SHULPHQWV EHFDXVH RI WKH H[WHQVLYH FKDUDFWHUL]DWLRQ RI TXLQROLQH VRUSWLRQ E\ WKLV VRLO =DFKDUD HW DO f 6RUSWLRQ RI QDSKWKDOHQH E\ WKH RUJDQLF IUDFWLRQ RI

PAGE 92

VRLO LV ZHOO GRFXPHQWHG &KLRX HW DO .DULFNKRII HW DO f 3UHn LQRFXODWLRQ RI WKH 1RUERUQH VRLO ZLWK EDFWHULD FIXJf VLPXODWHV FRQWDPLQDWHG VXEVXUIDFH VRLOV DQG DTXLIHUV ZKHUH EDFWHULDO SRSXODWLRQV PD\ EH KLJK 0DWHULDOV DQG 0HWKRGV 6RUEHQWV 7KH 1RUERUQH VRLO ZDV XVHG IRU WKHVH VWXGLHV 7DEOH f *ODVVEHDGV DYHUDJH GLDPHWHU MXP $OOWHFK $VVRFLDWHVf DQG LQHUW TXDUW] VDQG PPf ZHUH XVHG DV LQHUW VROLG VXSSRUW PDWHULDO $OO VRUEHQWV ZHUH VWHULOL]HG XVLQJ VWHDP DXWRFODYLQJ DV UHIHUHQFHG LQ &KDSWHU 6RUEDWHV 3HQWDIOXRUREHQ]RLF DFLG 3)%$ PJP/f ZDV XVHG DV FRQVHUYDWLYH QRQVRUELQJ WUDFHU WR DVVHVV WKH K\GURG\QDPLF GLVSHUVLRQ DQG H[WHQW RI SK\VLFDO QRQHTXLOLEULXP FRQGLWLRQV SUHYDLOLQJ GXULQJ WUDQVSRUW WKURXJK WKH VRLO FROXPQV %UXVVHDX HW DO f 4XLQROLQH DQG QDSKWKDOHQH FRQFHQWUDWLRQV LQ WKH LQIOXHQW VROXWLRQV IRU WKH FROXPQ VWXGLHV UDQJHG IURP WR AJP/ ,VRWRSLF H[FKDQJH RI &D DQG &D GSPP/f ZDV DOVR LQYHVWLJDWHG $TXHRXV VROXWLRQV RI WKH FKHPLFDOV ZHUH SUHSDUHG LQ ILOWHUVWHULOL]HG MXPf RU 0 &D&, 6RUEDWHV ZHUH PRQLWRUHG E\ +3/&89 IRU TXLQROLQH DQG QDSKWKDOHQH DQG E\ UDGLRDVVD\ WHFKQLTXHV IRU &D 6HH &KDSWHU f

PAGE 93

%DFWHULDO 6WUDLQV DQG &XOWXUH &RQGLWLRQV $ VWUDLQ RI 3VHXGRPRQDV VS 1$ FDSDEOH RI GHJUDGLQJ TXLQROLQH DQG D PXWDQW VWUDLQ %f GHULYHG IURP WKH 1$ VWUDLQ >REWDLQHG IURP %URFNPDQ HW DO f@ ,QFRUSRUDWLRQ RI WZR SURWHLQV IRU EDFWHULDO HQXPHUDWLRQ UHQGHUHG WKH RUJDQLVP LQFDSDEOH RI GHJUDGLQJ TXLQROLQH 0F%ULGH HW DO f 7KH % LVRODWH ZDV XVHG WR GHWHUPLQH WKH LPSDFW RI ELRPDVV RQ VRUSWLRQ DQG WUDQVSRUW RI TXLQROLQH ZKHUH GHJUDGDWLRQ ZDV QRW D IDFWRU 7KH % DQG 1$ VWUDLQV ZHUH JURZQ IRU KRXUV RQ WU\SWLF VR\ EURWK J/f DW r & RQ D URWDU\ VKDNHU USPf %DFWHULDO FHOOV ZHUH KDUYHVWHG E\ FHQWULIXJDWLRQ ZDVKHG WZR WLPHV DQG GLOXWHG WR WKH GHVLUHG EDFWHULDO GHQVLW\ ZLWK WKH DSSURSULDWH EDFNJURXQG PDWUL[ VROXWLRQ RU 0 &D&,f %DFWHULD ZHUH DOORZHG WR HTXLOLEUDWH RYHUQLJKW LQ WKH GHVLUHG PDWUL[ SULRU WR HDFK H[SHULPHQW 3ODWH FRXQWV ZHUH GRQH XVLQJ WU\SWLF VR\ DJDU 76$f DQG GD\ LQFXEDWLRQ SHULRGV DW r& 3ODWH FRXQWV ZHUH YHULILHG E\ YLVXDO LQVSHFWLRQ RI EDFWHULDO VXVSHQVLRQV XVLQJ D KHPDF\WRPHWHU $ SKDVHFRQWUDVW PLFURVFRSH :LOG 1HHQEUXJJf ZDV XVHG IRU FRXQWLQJ WKH EDFWHULD LQ WKH KHPDF\WRPHWHU %DFWHULDO ,QRFXODWLRQ $ P/DOLTXRW RI WKH DSSURSULDWH EDFWHULDO VXVSHQVLRQ ZDV SODFHG LQ DQ DVSLUDWRU 7KH VWHULOH VRLO Jf ZDV WKLQO\ VSUHDG RQ DOXPLQXP IRLO DQG WKH EDFWHULDO VXVSHQVLRQ ZDV VSUD\HG RQ WKH VRLO LQ D ILQH PLVW WR XQLIRUPO\ GLVWULEXWH WKH EDFWHULD 7KH VRLO VDPSOH ZDV PL[HG WKRURXJKO\ WR HQVXUH

PAGE 94

KRPRJHQHRXV GLVWULEXWLRQ RI WKH EDFWHULD 7KH DVSLUDWRU ZDV ULQVHG ZLWK D P/ DOLTXRW RI ILOWHUHG [Pf &D&, DQG WKH ULQVDWH ZDV VSUD\HG RQ WKH VRLO 7KH LQLWLDO LQRFXODWLRQ UDWH ZDV FIXJ VRLO XQOHVV RWKHUZLVH LQGLFDWHG 7KH VRLO ZDV PL[HG DJDLQ DQG D VXEVDPSOH ZDV WDNHQ IRU ZDWHU FRQWHQW GHWHUPLQDWLRQ 7KH VRLOZDWHU FRQWHQW IROORZLQJ EDFWHULDO DGGLWLRQ UDQJHG IURP WR b &ROXPQ 6WXGLHV 0LVFLEOH GLVSODFHPHQW WHFKQLTXHV ZHUH XVHG WR FKDUDFWHUL]H WKH WUDQVSRUW RI 3)%$ &D TXLQROLQH DQG QDSKWKDOHQH 7KH VWHULOH RU EDFWHULDO LQRFXODWHG VRLO ZDV SDFNHG LQWR D .RQWHV JODVV FROXPQ FP ORQJ FP LGf DV GHVFULEHG LQ &KDSWHU $IWHU SDFNLQJ DSSUR[LPDWHO\ SRUH YROXPHV RI RU 0 &D&, VROXWLRQ ZHUH SXPSHG WKURXJK WKH FROXPQ WR DFKLHYH VDWXUDWHG VWHDG\ ZDWHU IORZ FRQGLWLRQV DQG XQLIRUP EDFWHULDO SRSXODWLRQV FIXJf 6RLO FROXPQV YDULHG LQ EDFWHULDO GHQVLW\ DQG W\SH VWHULOH RU LQRFXODWHG ZLWK HLWKHU % RU 1$ LVRODWHf DQG LQ LRQLF VWUHQJWK RU 0f RI WKH GLVSODFLQJ VROXWLRQ 6ROXWH FRQFHQWUDWLRQV ZHUH PRQLWRUHG FRQWLQXRXVO\ RU E\ FROOHFWLQJ FROXPQ HIIOXHQW IUDFWLRQV 'LVVROYHG R[\JHQ '2f LQ WKH VRLO FROXPQ HIIOXHQW ZDV PHDVXUHG DW GLIIHUHQW SRUHYHORFLWLHV IURP WR FPKU $ YHVVHO ZDV SXUJHG ZLWK 1 HIIOXHQW IURP WKH FROXPQ LQWURGXFHG DQG '2 PHDVXUHG ZLWK D GLVVROYHG R[\JHQ HOHFWURGH
PAGE 95

FRQFHQWUDWLRQV ZHUH DQG [JP/ %DFWHULDO VXVSHQVLRQV ZHUH HTXLOLEUDWHG ZLWK TXLQROLQH DW r & IRU KU WR PLQLPL]H LQWUDFHOOXODU XSWDNH DQG SRVVLEOH ELRGHJUDGDWLRQ E\ WKH 1$ LVRODWH %LRVRUSWLRQ RI &D ZDV PHDVXUHG DW URRP WHPSHUDWXUH r&f 6DPSOHV ZHUH FHQWULIXJHG IRU PLQ DW J DW r& WR VHSDUDWH WKH FHOOV IURP WKH DTXHRXV SKDVH 4XLQROLQH VROXWLRQ FRQFHQWUDWLRQV ZHUH PHDVXUHG E\ +3/& WR PRQLWRU IRU SRVVLEOH ELRGHJUDGDWLRQ SURGXFWV %LRVRUSWLRQ ZDV FDOFXODWHG DV WKH GLIIHUHQFH LQ WKH LQLWLDO DQG ILQDO VROXWLRQ FRQFHQWUDWLRQV 0LVFLEOH GLVSODFHPHQW WHFKQLTXHV GHVFULEHG HDUOLHU ZHUH HPSOR\HG WR PHDVXUH ELRVRUSWLRQ E\ EDFWHULD DWWDFKHG WR JODVV PLFUREHDGV *ODVV PLFUREHDGV DYHUDJH GLDPHWHU LP $OOWHFK $VVRFLDWHVf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f IRU WKH VWHULOH DQG LQRFXODWHG VRLO FROXPQV ZHUH XVHG IRU D TXDQWLWDWLYH DVVHVVPHQW RI f WKH K\GURG\QDPLF LPSDFWV EDVHG RQ 3 f WKH FKDQJHV LQ HTXLOLEULXP VRUSWLRQ FDSDFLW\ EDVHG RQ .S DQG f WKH DFFHVVLELOLW\ RI VRUSWLRQ UHJLRQV EDVHG RQ ) DQG N

PAGE 96

5HVXOWV 7KH EHKDYLRU RI 3)%$ LQ VWHULOH DQG EDFWHULDOLQRFXODWHG FROXPQV LV UHSUHVHQWHG E\ WKH 3)%$ EUHDNWKURXJK FXUYH %7&f LQ )LJXUH %7&V IRU TXLQROLQH 0 &D&,f LQ D VWHULOH DQG LQRFXODWHG % DQG 1$ LVRODWHVf FROXPQV DUH DOVR VKRZQ LQ )LJXUH %7&V IRU &D DQG QDSKWKDOHQH 0 &D&,f LQ VWHULOH DQG LQRFXODWHG % FROXPQV DUH VKRZQ LQ )LJXUH DQG UHVSHFWLYHO\ 7KH 3)%$ %7&V IRU DOO VRLO FROXPQV ZHUH V\PPHWULFDO DQG VLJPRLGDO LQ VKDSH ZKLFK VXJJHVWV WKH DEVHQFH RI SK\VLFDO QRQHTXLOLEULXP %UXVVHDX DQG 5DR Ef DQG 3 LV LQGLFDWLYH RI PLQLPDO K\GURG\QDPLF GLVSHUVLRQ 4XLQROLQH DQG QDSKWKDOHQH VRUSWLRQ ZDV UHGXFHG LQ LQRFXODWHG VRLO FROXPQV )LJXUHV DQG f &D VRUSWLRQ )LJXUH f ZDV QRW UHGXFHG LQ WKH % LQRFXODWHG VRLO FROXPQV 7KH VKLIW LQ WKH &D %7& LQ WKH WZR EDFWHULDOLQRFXODWHG VRLO FROXPQV %4 DQG %4f DQG WKH VWHULOH FROXPQ %f UHVXOWHG IURP GLIIHUHQFHV LQ WKH EXON GHQVLWLHV Sf DQG YROXPHWULF ZDWHU FRQWHQWV f RI WKH YDULRXV FROXPQV 7DEOH f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

PAGE 97

5HODWLYH &RQFHQWUDWLRQ &4f Â’ Â’ Â’ Â’ r Â’ r D r r r a r k k r k Â’ Â’ r Â’ % Â’ Â’ Â’ Â’ r r k 4XLQROLQH p 6WHULOH %f r 1$ %4f Â’ % %4f K 3)%$ r 3RUH 9ROXPHV Sf )LJXUH 0HDVXUHG %7&V IRU 3)%$ +f LQ D VWHULOH FROXPQ DQG IRU 4XLQROLQH LQ D VWHULOH pf 1$ LQRFXODWHG rf DQG % LQRFXODWHG Â’f VRLO FROXPQ &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH

PAGE 98

5HODWLYH &RQFHQWUDWLRQ &&Tf p p F#pR r p p r R R r p r p Fp R k r Fr r p 6WHULOH %f R % %4f r % %4f IWp p'p nf§p 3RUH 9ROXPHV Sf )LJXUH 0HDVXUHG %7&V IRU &D LQ VWHULOH #f DQG % LQRFXODWHG R DQG rf VRLO FROXPQV &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH

PAGE 99

5HODWLYH &RQFHQWUDWLRQ &&f R R R R R R R R R R R k R k R k k k 6WHULOH %f r % %4f 3RUH 9ROXPHV Sf )LJXUH 0HDVXUHG %7&V IRU 1DSKWKDOHQH LQ D VWHULOH #f DQG D % LQRFXODWHG Rf VRLO FROXPQ &ROXPQ GHVLJQDWLRQV DUH JLYHQ LQ SDUHQWKHVLV FRUUHVSRQGLQJ WR 7DEOH

PAGE 100

7DEOH &ROXPQ SDUDPHWHUV DQG .I YDOXHV IRU TXLQROLQH QDSKWKDOHQH DQG &D ,Q VWHULOH DQG LQRFXODWHG 1RUERUQH VRLO FROXPQV &D&, 3 H .I &ROXPQ ,' PRO/ S+ JFP FPFP 4XLQROLQH 1DSKWKDOHQH &D 6WHULOH %4 f§ 6WHULOH % % %4 f§ f§ % %4 % %4 f§ f§ 1$ %4 f§ f§ IRFXVHG RQ GLVWLQJXLVKLQJ EHWZHHQ WKH SURFHVVHV WKDW PD\ LQIOXHQFH FRQWDPLQDQW VRUSWLRQ DQG WUDQVSRUW LQFOXGLQJ DOWHUHG ZDWHU IORZ UHVXOWLQJ IURP SRUH EORFNDJH ELRIDFLOLWDWHG FRQWDPLQDQW WUDQVSRUW DQGRU DOWHUHG VRUSWLRQ FDSDFLW\ RI VRLO 3RUH %ORFNDJH 3RUH EORFNDJH RU VWUDLQLQJ RI EDFWHULD ZDV LQYHVWLJDWHG E\ PHDVXULQJ %7&V IRU D QRQDGVRUEHG WUDFHU 3)%$f RQFH D GD\ IRU GD\V IROORZLQJ EDFWHULDO LQRFXODWLRQ 9DULDWLRQV LQ SRUH YROXPH GHWHUPLQDWLRQV RU DV\PPHWULFDO %7&V ZRXOG LQGLFDWH FKDQJHV LQ SK\VLFDO FKDUDFWHULVWLFV RI WKH FROXPQ ,Q DOO FDVHV WKH %7&V PHDVXUHG IRU 3)%$ ZHUH V\PPHWULFDO LQGLFDWLYH RI QR FKDQJHV LQ K\GURG\QDPLF FKDUDFWHULVWLFVf DQG WKH SRUH YROXPH GHWHUPLQHG E\

PAGE 101

3)%$ UHPDLQHG FRQVWDQW LQGLFDWLYH RI QR EORFNDJH RU H[FOXVLRQ RI VRPH SRUHVf 7KHUHIRUH HDUO\ EUHDNWKURXJK RI TXLQROLQH DQG QDSKWKDOHQH ZDV QRW WKH UHVXOW RI SRUH EORFNDJH E\ EDFWHULDO ELRPDVV %LRIDFLOLWDWHG 7UDQVSRUW %DFWHULDO PLJUDWLRQ %LRIDFLOLWDWHG WUDQVSRUW UHTXLUHG YHULILFDWLRQ RI EDFWHULDO PLJUDWLRQ DQG ELRVRUSWLRQ %DFWHULDO PLJUDWLRQ LQ WKH 1RUERUQH & VRLO ZDV LQYHVWLJDWHG E\ SDFNLQJ WKH RXWOHW KDOI FPf RI D FROXPQ ZLWK VWHULOH VRLO ZKLOH WKH LQOHW KDOI FPf ZDV SDFNHG ZLWK % LQRFXODWHG VRLO FIXJf 7KH DSSHDUDQFH RI FIXP/ LQ HIIOXHQW IUDFWLRQV DIWHU GLVSODFHPHQW RI SRUH YROXPHV YHULILHG EDFWHULDO PLJUDWLRQ WKURXJK D KDOI VWHULOH DQG KDOI LQRFXODWHG 1RUERUQH VRLO FROXPQ %DFWHULDO FRXQWV ZHUH VLPLODU XVLQJ SODWH FRXQW WHFKQLTXHV DQG E\ YLVXDO LQVSHFWLRQ XVLQJ D KHPDF\WRPHWHU 7KHUHIRUH EDFWHULDO SRSXODWLRQV ZHUH VXEVHTXHQWO\ GHWHUPLQHG E\ SODWH FRXQWV $IWHU GD\V RI IORZ FPKUf WKH FROXPQ ZDV VHFWLRQHG LQWR FP VHJPHQWV DQG EDFWHULD ZHUH H[WUDFWHG ZLWK D S+ SKRVSKDWH VDOLQH VROXWLRQ ZKLFK ZDV UHFRPPHQGHG DV D VWDQGDUG PLFURELDO WHFKQLTXH :ROOXP f 7KH VRLO VDOLQH VXVSHQVLRQ ZDV GLOXWHG DOORZLQJ WKH VRLO WR VHWWOH DQG SODWHG 7KH EDFWHULDO GHQVLW\ ZDV FIXJ DW WKH LQOHW HQG RI WKH FROXPQ FIXJ LQ WKH FHQWHU VHFWLRQV RI WKH FROXPQ DQG FIXJ DW WKH HQG RI WKH FROXPQ 7KUHH REVHUYDWLRQV QRWHG ZHUH f LQFUHDVHG EDFWHULDO GHQVLWLHV YHULILHG EDFWHULDO JURZWK f SRSXODWLRQV GHFUHDVHG IURP WKH LQOHW WR WKH RXWOHW HQG RI WKH FROXPQ LQ UHVSRQVH WR LQRFXODWLRQ RI WKH LQOHW FP RI WKH FROXPQ DQG f EDFWHULD

PAGE 102

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f (QHUJ\ ZDV OLNHO\ GHULYHG IURP WKH GLVVROYHG RUJDQLF FDUERQ LQ WKH VRLO VROXWLRQ $VVXPLQJ D PD[LPXP EDFWHULDO SRSXODWLRQ RI FIXJ EDFWHULDO GU\ ZHLJKWV RI r n JFIX *UD\ HW DO f DQG b RI WKH EDFWHULDO FHOO LV RUJDQLF FDUERQ %UDWEDN DQG 'XQGDV f r n J RI RUJDQLF FDUERQ LV UHTXLUHG WR PDLQWDLQ WKLV SRSXODWLRQ 7KH DYDLODEOH GLVVROYHG RUJDQLF FDUERQ '2&f IURP VRLOV KDV EHHQ HVWLPDWHG WR EH DERXW b RI WKH WRWDO RUJDQLF FDUERQ 5HGG\ HW DO f 7KHUHIRUH DERXW r n J '2& SHU P/ RI VRLO VROXWLRQ SURYLGLQJ PD\ KDYH EHHQ DYDLODEOH ZKLFK FDQ SURYLGH DGHTXDWH HQHUJ\ IRU EDFWHULDO FHOO SURGXFWLRQ :DWHU IORZ PD\ DOWHU EDFWHULDO PRYHPHQW DQG WKH GLVVROYHG R[\JHQ '2f FRQWHQW ZKLFK LQ WXUQ PD\ LQIOXHQFH WKH DFWLYLW\ RI PLFURRUJDQLVPV 6PLWK HW DO 7UHYRUV HW DO /LQGTYLVW DQG %HQJWVVRQ f 7KHUHIRUH '2 ZDV PHDVXUHG DW GLIIHUHQW YHORFLWLHV $ YHVVHO ZDV SXUJHG ZLWK 1 HIIOXHQW IURP WKH FROXPQ LQWURGXFHG DQG '2 PHDVXUHG ZLWK D GLVVROYHG R[\JHQ HOHFWURGH
PAGE 103

IURP WR PJ/ LQ WKH FROXPQ HIIOXHQW DQG LQFUHDVHG ZLWK DQ LQFUHDVH LQ YHORFLW\ WR FPKUf $V D UHVXOW VXEVHTXHQW H[SHULPHQWV ZHUH FRQGXFWHG DW DERXW FPKU 7UDQVSRUW RI EDFWHULD WKURXJK WKH VRLO FROXPQ LV D QHFHVVDU\ EXW QRW D VXIILFLHQW FRQGLWLRQ IRU FODLPLQJ ELRIDFLOLWDWHG WUDQVSRUW RI FRQWDPLQDQWV ,W ZDV DOVR QHFHVVDU\ WR HVWDEOLVK WKDW WKH FRQWDPLQDQW ZDV VRUEHG WR DQ DSSUHFLDEOH H[WHQW E\ WKH EDFWHULDO ELRPDVV %LRVRUSWLRQ 4XLQROLQH DQG &D ELRVRUSWLRQ E\ WKH 1$ LVRODWH RU LWV PXWDQW % ZDV QRW PHDVXUDEOH DW r& RU URRP WHPSHUDWXUH r&f XVLQJ EDWFK WHFKQLTXHV +RZHYHU YDULDWLRQV LQ S+ QXWULHQWV DQG DYDLODELOLW\ RI VXUIDFHV PD\ DOWHU WKH VRUSWLYH FKDUDFWHULVWLFV RI PLFURELDO VXUIDFHV %HYHULGJH DQG *UDKDP f 7KHUHIRUH ELRVRUSWLRQ RI TXLQROLQH DQG &D ZDV GHWHUPLQHG GLUHFWO\ LQ FROXPQ H[SHULPHQWV )LOWUDWLRQ MDPf RI WKH FROXPQ HIIOXHQW WR VHSDUDWH ELRVRUEHG WUDSSHG ZLWK WKH ELRPDVV RQ WKH ILOWHUf DQG IUHH VSHFLHV LQ WKH ILOWUDWHf VKRZHG QR UHGXFWLRQ LQ WKH VROXWLRQ FRQFHQWUDWLRQ RU DFFXPXODWLRQ RQ WKH ILOWHU 7KHUHIRUH ELRIDFLOLWDWHG WUDQVSRUW RI TXLQROLQH DQG &D E\ EDFWHULD LQ WKH VROXWLRQ SKDVH ZDV QRW OLNHO\ 7KH H[WHQW RI &D TXLQROLQH DQG QDSKWKDOHQH ELRVRUSWLRQ E\ DGVRUEHG EDFWHULD ZDV GHWHUPLQHG E\ %7&V PHDVXUHG LQ D FROXPQ SDFNHG ZLWK JODVV PLFUREHDGV DQG LQRFXODWHG ZLWK WKH % LVRODWH FIXJf 0LVFLEOH GLVSODFHPHQW WHFKQLTXHV DUH SUHIHUUHG IRU HVWLPDWLQJ VRUSWLRQ SDUDPHWHUV HVSHFLDOO\ LQ ORZVRUSWLYH V\VWHPV %UXVVHDX HW DO f LH VPDOO .Sf 7KH 5 IRU TXLQROLQH &D DQG QDSKWKDOHQH LQ D VWHULOH JODVVEHDG FROXPQ ZDV

PAGE 104

DSSUR[LPDWHO\ LQGLFDWLQJ QR VRUSWLRQ RI WKHVH VROXWHV E\ JODVVEHDG VXUIDFHV 7KXV DQ\ UHWDUGDWLRQ PHDVXUHG LQ WKH LQRFXODWHG JODVVEHDG FROXPQ LV DWWULEXWHG WR ELRVRUSWLRQ E\ WKH DWWDFKHG EDFWHULD %LRVRUSWLRQ ZDV VPDOO IRU &D 5 f DQG TXLQROLQH 5 f FRUUHVSRQGLQJ WR D .S m P/J ZKLOH QDSKWKDOHQH ELRVRUSWLRQ ZDV VOLJKWO\ JUHDWHU 5 .S m P/Jf )LJXUH f 7KHVH UHVXOWV VXJJHVW WKDW ELRIDFLOLWDWHG WUDQVSRUW RI &D QDSKWKDOHQH DQG TXLQROLQH LV QRW OLNHO\ WR EH LPSRUWDQW LQ RXU VWXGLHV XQOHVV KLJK GHQVLWLHV FIXP/f RI EDFWHULDO ELRPDVV DUH VORXJKHG RII LQWR WKH FROXPQ HIIOXHQW %DFWHULDO SRSXODWLRQV LQ WKH HIIOXHQW RI JODVVEHDG FROXPQV ZHUH WR FIXP/ ZKLFK ZDV KLJKHU WKDQ SRSXODWLRQV LQ WKH 1RUERUQH VRLO FROXPQV FIXP/f 7KH LQFUHDVHG EDFWHULDO SRSXODWLRQV PD\ KDYH EHHQ GXH WR D ODUJHU SRUH VL]H RU D UHGXFWLRQ LQ WKH VRUSWLRQ FDSDFLW\ RI WKH JODVVEHDGV YHUVXV WKH 1RUERUQH VRLO 6RUSWLRQ RI EDFWHULD RQ JODVV VXUIDFHV DQG PHFKDQLVPV RI DWWDFKPHQW KDYH EHHQ GRFXPHQWHG +HXNHOHNLDQ DQG +HOOHU =REHOO 6WRWN]\ YDQ /RRVGUHFKW HW DO 0DUVKDOO f 7KHUHIRUH ODUJHU SRUH VL]H ZLWKLQ WKH JODVVEHDG FROXPQ OLNHO\ UHGXFHG SK\VLFDO FRQVWUDLQWV DQG IDFLOLWDWHG EDFWHULDO PLJUDWLRQ 7KXV ELRIDFLOLWDWHG WUDQVSRUW PD\ SUHGRPLQDWH LQ SRURXV VDQG\ DTXLIHU PDWHULDO (QKDQFHG EDFWHULDO PLJUDWLRQ FDXVHG FRDWLQJV WR IRUP RQ WKH 89 GHWHFWRU FHOO ZKLFK LQWHUIHUHG ZLWK IORZn WKURXJK GHWHFWLRQ RI WKH FROXPQ HIIOXHQW 7KLV VXJJHVWV WKDW IUDFWLRQ FROOHFWLRQ LV HVVHQWLDO WR DYRLG DQDO\WLFDO FRPSOLFDWLRQV LQ SRURXV PHGLD ZKLFK DUH

PAGE 105

5HODWLYH &RQFHQWUDWLRQ &&Tf rc p Â’ R R R R r Â’ R r Â’ *ODVVEHDG &ROXPQ R 1DSKWKDOHQH k &D 4XLQROLQH r 3)%$ 3RUH 9ROXPHV Sf )LJXUH 0HDVXUHG %7&VIRU 3)%$ rf &D kf 4XLQROLQH Â’f DQG 1DSKWKDOHQH Rf LQ D % LQRFXODWHG VRLO FROXPQ

PAGE 106

LQRFXODWHG ZLWK EDFWHULD 7KHUHIRUH ELRVRUSWLRQ RI TXLQROLQH DQG &D ZDV GHWHUPLQHG GLUHFWO\ LQ FROXPQ H[SHULPHQWV )LOWUDWLRQ LPf RI WKH FROXPQ HIIOXHQW WR VHSDUDWH ELRVRUEHG WUDSSHG ZLWK WKH ELRPDVV RQ WKH ILOWHUf DQG IUHH VSHFLHV LQ WKH ILOWUDWHf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f 7KH ]HWD SRWHQWLDO RI WKH 1$ DQG % LVRODWHV ZDV GHWHUPLQHG XVLQJ D /DVHU =HH 0HWHU 3(1.(0 0RGHO f 7KH EDFWHULDO EXIIHU VROXWLRQ m P/f ZDV SODFHG LQ DQ HOHFWURSKRUHVLV FKDPEHU FRQVLVWLQJ RI WZR HOHFWURGHV DQG D FRQQHFWLQJ FKDPEHU 7KH UDWH RI EDFWHULDO PRYHPHQW LQ D NQRZQ HOHFWULF ILHOG ZDV PRQLWRUHG WKURXJK D PLFURVFRSH ZLWK D [ REMHFWLYH OHQV DQG D [ RFXODU OHQV $OO PHDVXUHPHQWV ZHUH PDGH LQ WKH VWDWLRQDU\ OD\HU WR DYRLG IORZ LQ WKH ERXQGDU\ OD\HUV =HWD SRWHQWLDO ZDV FRQYHUWHG WR HOHFWURSKRUHWLF PRELOLW\ XVLQJ WKH +HOPKROW]6PROXFKRZVNL HTXDWLRQ 6KHUEHW f 7KH HOHFWURSKRUHWLF PRELOLW\ RI WKH 1$ LVRODWH UDQJHG IURP WR f PHWHU9VHF IURP S+ WR 2YHU WKH VDPH S+

PAGE 107

UDQJH WKH HOHFWURSKRUHWLF PRELOLW\ RI WKH % LVRODWH UDQJHG WR n PHWHU9VHF 7KHVH YDOXHV DUH LQ DJUHHPHQW ZLWK HOHFWURSKRUHWLF PRELOLWLHV PHDVXUHG RYHU WKH VDPH S+ UDQJH .UHNHOHU HW DO f DQG HOHFWURSKRUHWLF PRELOLWLHV WR n PHWHU9VHFf PHDVXUHG IRU EDFWHULDO LVRODWHV YDQ /RRVGUHFKW HW DO f 7KH ORZHU QHJDWLYH FKDUJH RI WKH % LVRODWH VXJJHVWV WKDW LW KDV D JUHDWHU SRWHQWLDO WKDQ 1$ WR DSSURDFK WKH VRLO VXUIDFH DQG DWWDFK 7KH UHODWLYH EDFWHULDO K\GURSKRELFLW\ RI WKH EDFWHULDO LVRODWHV ZDV GHWHUPLQHG E\ SDUWLWLRQLQJ WKH EDFWHULDO LVRODWHV EHWZHHQ KH[DGHFDQH DQG D SKRVSKDWH EXIIHU VROXWLRQ IROORZLQJ WKH SURFHGXUH XVHG E\ 5RVHQEHUJ HW DO f %DFWHULDO FHOOV ZKLFK SDUWLWLRQ LQWR WKH KH[DGHFDQH SKDVH IURP WKH DTXHRXV SKDVH LQGLFDWHG WKDW EDFWHULDO VXUIDFHV DUH K\GURSKRELF 7KH K\GURSKRELFLW\ HJ DGVRUSWLRQ SRWHQWLDOf ZDV DVVHVVHG E\ WKH EDFWHULDO GLVWULEXWLRQ FRHIILFLHQW EHWZHHQ WKH KH[DGHFDQH SKDVH DQG WKH DTXHRXV SKDVH 'KZf $W S+ WKH 'KZ ZDV WLPHV ODUJHU IRU WKH % LVRODWH '+: POBP/f WKDQ WKH 1$ LVRODWH '+: P/P/f +RZHYHU DW S+ WKH 'KZ ZDV WLPHV ODUJHU IRU WKH % LVRODWH '+: P/P/f WKDQ WKH 1$ LVRODWH '+: P/P/f 7KH K\GURSKRELFLW\ RI WKH % LVRODWH LV JUHDWHU WKDQ WKH 1$ LVRODWH LQ WKH S+ UDQJH RI WKH VRLO FROXPQV %RWK K\GURSKRELF DQG HOHFWURVWDWLF LQWHUDFWLRQV IDYRU VRUSWLRQ RI WKH % LVRODWH *LYHQ WKDW EDFWHULD PD\ DWWDFK JURZ DQG FRORQL]H WKH VXUIDFH WKH SRWHQWLDO H[LVWV WR DOWHU WKH VRLO VXUIDFH DQG PRUH VSHFLILFDOO\ WKH VRLO VRUSWLRQ FDSDFLW\

PAGE 108

(YLGHQFH IRU DOWHUDWLRQ RI WKH VRLO VXUIDFH E\ EDFWHULDO ELRPDVV ZDV VXJJHVWHG LQ DQ LQHUW TXDUW] VDQG PPf FROXPQ 7KH HIIOXHQW S+ IURP D %LQRFXODWHG TXDUW] VDQG FROXPQ ZDV XSRQ LQWURGXFWLRQ RI 3)%$ S.D f ZKLOH WKH S+ RI 3)%$ SDVVLQJ WKURXJK WKH VWHULOH TXDUW] VDQG FROXPQ ZDV S+ 7KH TXDUW] VDQG KDV QR DSSUHFLDEOH EXIIHU FDSDFLW\ IRU PDLQWDLQLQJ WKH S+ RI WKH DFLGLF 3)%$ VROXWLRQ 7KHUHIRUH WKH S+ LQFUHDVH LQ WKH FROXPQ LQRFXODWHG ZLWK EDFWHULD VXJJHVWV WKDW WKH EDFWHULDO ELRPDVV DOWHUHG WKH VRLO VXUIDFH HQYLURQPHQW HJ EDFWHULD KDYH DQ LQKHUHQW EXIIHU FDSDFLW\f &KDQJHV LQ EXON VROXWLRQ S+ ZHUH QRW REVHUYHG IRU WKH H[SHULPHQWV ZLWK WKH 1RUERUQH VRLO FROXPQ EHFDXVH RI WKH ODUJHU EXIIHU FDSDFLW\ RI WKLV VRLO 7KLV GRHV QRW KRZHYHU SUHFOXGH WKH SRVVLELOLW\ WKDW DOWHUDWLRQ RI S+ KDG RFFXUUHG ZLWKLQ WKH LQWHUIDFLDO UHJLRQV IRU WKH 1RUERUQH VRLO 6LQFH LW LV GLIILFXOW WR PHDVXUH DQ\ FKDQJHV LQ LQWHUIDFLDO S+ GLUHFWO\ ZH FDQ RQO\ LQIHU KHUH WKH WUHQGV EDVHG RQ REVHUYHG HIIHFWV RQ TXLQROLQH VRUSWLRQ E\ WKH 1RUERUQH VRLO $SSUR[LPDWHO\ b RI TXLQROLQH VRUSWLRQ RFFXUUHG ZLWKLQ WKH LQWHUOD\HU SRVLWLRQV RI SK\OORVLOLFDWH PLQHUDOV 0LFURRUJDQLVPV DUH XQDEOH WR DFFHVV LQWHUODPHOODU UHJLRQV RI FOD\ PLQHUDOV GXH WR VL]H FRQVWUDLQWV $V D UHVXOW RQO\ b RI WKH VRUSWLYH UHJLRQ LV GLUHFWO\ LQ FRQWDFW ZLWK EDFWHULDO ELRPDVV ([WUDFHOOXODU SRO\PHUV PD\ EH UHOHDVHG DQG PLJUDWH ZLWKLQ LQWHUODPHOODU FOD\ UHJLRQV +RZHYHU WKH LQIOXHQFH RI EDFWHULDO ELRPDVV LV OLNHO\ LQGLUHFW 3URFHVVHV VXFK DV UHVSLUDWLRQ FRQVXPH R[\JHQ DQG UHOHDVH RI & OLNHO\ GHFUHDVLQJ S+ ZKLFK ZRXOG LQFUHDVH VRUSWLRQ 6LPXOWDQHRXVO\ D GHFUHDVH LQ

PAGE 109

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b DQG 1$ UHGXFHG TXLQROLQH VRUSWLRQ E\ DERXW b 7DEOH f 'HVSLWH WKH GLIIHUHQFHV LQ LQRFXODWLRQ UDWH FIXJ 1$ FIXJ %f WKH HDUO\ TXLQROLQH EUHDNWKURXJK LQ LQRFXODWHG % YHUVXV 1$f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f VRLO FROXPQV ZHUH DWWULEXWHG WR PLFURELDO VXUIDFH FKDUDFWHULVWLFV DQG WKHLU LPSDFW RQ WKH VRLO VXUIDFHV 6XUIDFH $FFHVVLELOLW\ $Q DWWHPSW ZDV PDGH WR XVH WKH ELFRQWLQXXP PRGHO WR TXDQWLWDWLYHO\ DVVHVV WKH LPSDFWV RI EDFWHULDO ELRPDVV RQ WKH SK\VLFDO DFFHVVLELOLW\ RI VRUSWLYH

PAGE 110

UHJLRQV LQ WKH VRLO +RZHYHU ELFRQWLQXXP VRUSWLRQ PRGHO DQDO\VLV RI WKH %7& GDWD ZDV DWWHPSWHG RQO\ IRU WKH QDSKWKDOHQH %7& GDWD IRU WKH IROORZLQJ UHDVRQV f XQSXEOLVKHG GDWD VXJJHVWV WKDW TXLQROLQH VRUSWLRQ G\QDPLFV DUH PRUH FRPSOLFDWHG WKDQ WKDW FRQFHSWXDOL]HG LQ WKH ELFRQWLQXXP PRGHO DQG f FDWLRQ H[FKDQJH NLQHWLFV DUH UDSLG HQRXJK WKDW WKH ELFRQWLQXXP PRGHO LV QRW QHHGHG WR GHVFULEH &D %7&V DQ HTXLOLEULXP VRUSWLRQ PRGHO SURYLGHV DQ DGHTXDWH GHVFULSWLRQ %UXVVHDX HW DO f 7KH ELFRQWLQXXP VRUSWLRQ PRGHO ZDV XVHG WR ILW WKH QDSKWKDOHQH %7& GDWD DQG WR HYDOXDWH WKH DOWHUDWLRQV LQ DFFHVVLELOLW\ WR VRUSWLYH UHJLRQV RI VRLO $ERXW b ) f RI QDSKWKDOHQH VRUSWLRQ ZDV VXUPLVHG WR KDYH RFFXUUHG LQVWDQWDQHRXVO\ LQ WKH VWHULOH VRLO ZKLOH ) GHFUHDVHG WR LQ WKH LQRFXODWHG FROXPQ $ERXW b UHGXFWLRQ LQ WKH ) YDOXH VXJJHVWV WKDW WKH DFFHVVLELOLW\ RI VRUSWLRQ UHJLRQV WR QDSKWKDOHQH KDG EHHQ UHGXFHG GXH WR WKH SUHVHQFH RI EDFWHULDO ELRPDVV 7KH N KUnf DQG .S P/Jf IURP WKH VWHULOH FROXPQ DUH LQ DJUHHPHQW ZLWK WKH ORJORJOLQHDU LQYHUVH UHODWLRQVKLS EHWZHHQ ORJ N DQG ORJ .S YDOXHV ORJ N ORJ .Sf UHSRUWHG IRU VRUSWLRQ RI +2&V %UXVVHDX DQG 5DR Df +RZHYHU WKH N YDOXH HVWLPDWHG IURP WKH QDSKWKDOHQH %7& PHDVXUHG LQ WKH LQRFXODWHG VRLO FROXPQ ZDV DERXW D WKLUG RI WKDW IRU WKH VWHULOH FROXPQ YV KUnf ZKLFK LV LQGLFDWLYH RI IXUWKHU FRQVWUDLQWV RQ QDSKWKDOHQH VRUSWLRQ 7KH DQDO\VLV RI PRGHO SDUDPHWHUV VXJJHVWV WKH IROORZLQJ f DQ RYHUDOO UHGXFWLRQ LQ QDSKWKDOHQH VRUSWLRQ GHFUHDVH LQ .Sf DQG f D GHFUHDVH LQ DFFHVVLELOLW\ RI VRUSWLRQ UHJLRQV GHFUHDVH LQ ERWK ) DQG Nf

PAGE 111

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f +2& VRUSWLRQ LV DVVXPHG WR RFFXU ZLWKLQ WKH RUJDQLF IUDFWLRQ RI WKH VRLO f VRUSWLRQ RI FDWLRQV RFFXUV SUHGRPLQDQWO\ RQ FDWLRQ H[FKDQJH VLWHV ORFDWHG ZLWKLQ FOD\ LQWHUOD\HUV DQG DJJUHJDWHV f EDFWHULD FRORQL]H VRLO VXUIDFHV DV PLFURFRORQLHV 9DQGHYLYHUH DQG %DYH\H 0DUVKDOO f DQG f

PAGE 112

EDFWHULD DUH DVVXPHG WR DGKHUH WR VRLO VXUIDFHV LQ FROORFDWLRQ ZLWK WKH HQHUJ\ DQG QXWULHQW VRXUFHV HJ RUJDQLF PDWWHU DQG FOD\f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f EXW GLVSODFHPHQW RI EDFWHULDO VROXWLRQV FRQWDLQLQJ ''7 WKURXJK WKH VDQG FROXPQV GHPRQVWUDWHG ELRIDFLOLWDWHG WUDQVSRUW LQ ZKLFK 5 ZDV UHGXFHG IROG /LQGTYLVW DQG (QILHOG Df %LRIDFLOLWDWHG WUDQVSRUW PD\ EH PRVW LPSRUWDQW LQ FRQWDPLQDWHG VLWHV ZKHUH EDFWHULDO SRSXODWLRQV DQG FKHPLFDO FRQFHQWUDWLRQV DUH KLJK DQG IRU FKHPLFDOV H[KLELWLQJ KLJK ELRVRUSWLRQ SRWHQWLDO +RZHYHU LQLWLDO LQFXEDWLRQ RI D FRQWDPLQDQW ZLWK WKH VRLO SULRU WR EDFWHULDO DGGLWLRQ PD\ UHGXFH WKH SRWHQWLDO IRU ELRIDFLOLWDWHG WUDQVSRUW GXH WR UDWHOLPLWHG FRQWDPLQDQW GHVRUSWLRQ

PAGE 113

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f VXJJHVWn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r n DQG WKH VRLO KDG DQ IRF RI ,Q

PAGE 114

WKLV FDVH EDFWHULDO ELRPDVV DGGHG DERXW b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f PD\ DOWHU WKH DELOLW\ RI 1RUERUQH VRLO WR VRUE FKHPLFDOV 7KLV VRLO KDV D ORZ RUJDQLF FDUERQ FRQWHQW bf DQG HOHFWURVWDWLF LQWHUDFWLRQV DUH SULPDULO\ DVVRFLDWHG ZLWK WKH FOD\ LQWHUOD\HU SRVLWLRQV %DFWHULDO ELRPDVV PD\ KDYH DOWHUHG VRUSWLRQ RI TXLQROLQH LQ LQWUDDJJUHJDWH DQG LQWHUODPHOODU UHJLRQV 5HGXFHG DFFHVVLELOLW\ RI RUJDQLF PDWWHU E\ EDFWHULDO ELRPDVV GHFUHDVHG QDSKWKDOHQH VRUSWLRQ 6XPPDU\ 7KH LPSDFW RI ELRPDVV RQ WKH VRUSWLRQ DQG WUDQVSRUW RI FRQWDPLQDQWV ZDV LQYHVWLJDWHG 6RUSWLRQ RI 1+&V ZDV VKRZQ WR EH UHGXFHG DV D UHVXOW RI

PAGE 115

VSHFLDWLRQ FKDQJHV DW WKH VRLOVROXWLRQ LQWHUIDFHV ZKLFK ZHUH LQGXFHG E\ EDFWHULDO ELRPDVV 7KH VRUSWLRQ RI DQ LQRUJDQLF FDWLRQ FDOFLXPf ZDV QRW DIIHFWHG E\ WKH SUHVHQFH RI EDFWHULDO ELRPDVV VXJJHVWLQJ WKDW EORFNDJH RI FDWLRQ H[FKDQJH VLWHV ZDV PLQLPDO +2& VRUSWLRQ ZDV VOLJKWO\ UHGXFHG GXH WR D FRPELQDWLRQ RI SURFHVVHV LQFOXGLQJ EORFNDJH RI RUJDQLF UHJLRQV E\ K\GURSKLOLF EDFWHULD DQG ELRIDFLOLWDWHG WUDQVSRUW 1DSKWKDOHQH KDV D ORJ .RZ RI DERXW DQG ELRIDFLOLWDWHG WUDQVSRUW ZDV QRW VXEVWDQWLDO +RZHYHU FRPSRXQGV ZLWK ORJ .RZ YDOXHV !f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

PAGE 116

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bf H[LVW LQ WKH VROXWLRQSKDVH %LRDYDLODELOLW\ RI VRUEHG FRQWDPLQDQWV KDV EHHQ WKH SULPDU\ IRFXV RI UHFHQW UHVHDUFK HIIRUWV VLQFH WKH VXFFHVV RI ELRUHPHGLDWLRQ SUDFWLFHV LV SUHGLFDWHG RQ FRQWDPLQDQW UHOHDVH IURP WKH VRUEHGSKDVH 6HYHUDO TXHVWLRQV QHHG WR EH DQVZHUHG WR XQGHUVWDQG WKH FRXSOLQJ RI VRUSWLRQ DQG ELRGHJUDGDWLRQ f ,V WKH SURFHVV LQWUD RU H[WUDFHOOXODU" f ,V VRUSWLRQ UHYHUVLEOH RU LUUHYHUVLEOH" f :KHUH GRHV WKH FRQWDPLQDQW UHVLGH ZLWKLQ WKH VRUEHQW PDWUL[

PAGE 117

RU RQ WKH VXUIDFH" DQG f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

PAGE 118

RFFXUV LQWUDFHOOXODUO\ 0LFURRUJDQLVPV PD\ EH H[FOXGHG IURP PRVW SRUHV ZLWKLQ WKH VRUEHQW PDWULFHV %LRGHJUDGDWLRQ LQ WKLV FDVH LV OLPLWHG E\ PDVV WUDQVIHU RI WKH VROXWH IURP WKH LQWHULRU RI WKH VRUEHQW WR WKH H[WHULRU VROXWLRQ 7KLV VFHQDULR LV RIWHQ XVHG WR GHVFULEH ELRGHJUDGDWLRQ OLPLWHG E\ LQWUDSDUWLFOH &KXQJ HW DO 6FRZ DQG $OH[DQGHU f RU LQWUDRUJDQLF PDWWHU GLIIXVLRQ )RU VHYHUDO +2&V DQG D IHZ LRQLF FRPSRXQGV HJ GLTXDWf PDVV WUDQVIHU KDV EHHQ VKRZQ WR OLPLW VRUSWLRQGHVRUSWLRQ UDWHV DQG ELRGHJUDGDWLRQ 6HH &KDSWHU f $ PDMRULW\ RI RUJDQLF FRQWDPLQDQWV DUH GHJUDGHG LQWUDFHOOXODUO\ WKHUHIRUH GHVRUSWLRQ RI FRQWDPLQDQWV LV UHTXLUHG IRU PLFURELDO XSWDNH DQG VXEVHTXHQW ELRGHJUDGDWLRQ 6RUSWLRQ RI +2&V LV JHQHUDOO\ UHYHUVLEOH &KLRX HW DO f ZKHUHDV FRQWDPLQDQWV VXFK DV GLTXDW PD\ EHFRPH LUUHYHUVLEO\ ERXQG ZLWKLQ LQWHUOD\HUV RI FOD\ PLQHUDOV :HEHU DQG &REOH f )RU +2&V WKH WRWDO FRQWDPLQDQW GHJUDGHG VKRXOG QRW EH OLPLWHG E\ VRUSWLRQ XQOHVV HQ]\PHV QHFHVVDU\ IRU ELRGHJUDGDWLRQ DUH QRW VXVWDLQHG )LJXUH SUHVHQWV D VFKHPDWLF YLHZ RI WKH VSDWLDO DUUDQJHPHQW RI PLFURRUJDQLVPV DQG VROXWHV LQ D VRLO DJJUHJDWH 7KH VRUEHGSKDVH VROXWH 6f LV ORFDWHG SULPDULO\ ZLWKLQ WKH VRUEHQW PDWUL[ 7KH FRQFHQWUDWLRQ RI VROXWH LQ WKH SRUH ZDWHU &f DQG EXON VROXWLRQSKDVH &f LV GHSHQGHQW RQ WKH VRUSWLRQ FDSDFLW\ RI WKH VRLO DQG WKH PLFURELDO ELRGHJUDGDWLYH FDSDFLW\ 0LFURRUJDQLVPV H[LVW SUHGRPLQDQWO\ RQ WKH H[WHUQDO VXUIDFH RI VRLO SDUWLFOHV RU DJJUHJDWHV 8SRQ JURZWK PLFURRUJDQLVPV PD\ VORXJK RII LQWR WKH VROXWLRQSKDVH $V VRLO

PAGE 119

2UJDQLF 0DWWHU &OD\ 0LQHUDO 0LFURRUJDQLVPV 0HWDEROLVP \71 3n )LJXUH 6FKHPDWLF RI VRUSWLRQ DQG ELRGHJUDGDWLRQ LQ VRLO DJJUHJDWHV & DQG & WKH VROXWH FRQFHQWUDWLRQ LQ WKH SRUH ZDWHU LQVLGH WKH DJJUHJDWH DQG WKH EXON VROXWLRQ UHVSHFWLYHO\f DGDSWHG IURP 0LKHOFLF DQG /XWK\ Ff

PAGE 120

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f GHYHORSHG D GLIIXVLRQVRUSWLRQELRGHJUDGDWLRQ '6%f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

PAGE 121

b & 0,1(5$/,=(' )LJXUH 7KH LPSDFW RI YDU\LQJ WKH VRUSWLRQ SDUWLWLRQ FRHIILFLHQW RQ ELRGHJUDGDWLRQ /NJf LQ WKH SUHVHQFH RI DJJUHJDWHV ZLWK UDGLL RI FP )URP 6FRZ DQG +XWVRQ f

PAGE 122

& 0,1(5$/,=(' +2856 )LJXUH 'DWD V\PEROVf IRU DJJUHJDWHV ZLWK GLIIHUHQW UDGLL DQG '6% PRGHO VLPXODWLRQV VROLG OLQHVf RI PLQHUDOL]DWLRQ RI QJ &ODEHOHG JOXWDPDWHP/ LQ WKH SUHVHQFH RI JHO H[FOXVLRQ EHDGV )URP 6FRZ DQG $OH[DQGHU f

PAGE 123

WRWDO IUDFWLRQ PLQHUDOL]HG DSSURDFKHV D FRQVWDQW YDOXH LQ DOO FDVHV HYHQ WKRXJK WKH REVHUYHG UDWH RI PLQHUDOL]DWLRQ GHFUHDVHV ZLWK LQFUHDVLQJ VRUEHQW PDVV $ PRGHO GHVFULELQJ WKH VRUSWLRQ ELRGHJUDGDWLRQ DQG WUDQVSRUW RI FRQWDPLQDQWV LQ DJJUHJDWHG VRLOV EDVHG RQ UDWHOLPLWHG PDVV WUDQVIHU DQG ILUVW RUGHU ELRGHJUDGDWLRQ NLQHWLFV ZDV SUHVHQWHG E\ *DPHUGLQJHU HW DO f 7KH\ DVVXPHG WKDW ELRGHJUDGDWLRQ RFFXUUHG LQ ERWK VROXWLRQ DQG VRUEHG SKDVHV *DPHUGLQJHU HW DO f PRGHOHG WKH GDWD UHSRUWHG E\ YDQ *HQXFKWHQ HW DO f IURP WKH FROXPQ H[SHULPHQW ZLWK WULFKORURSKHQR[\ DFHWLF DFLG KHUELFLGH LQ DQ DJJUHJDWHG VRLO 7KH RSWLPL]HG VLPXODWLRQ WKDW LQFOXGHG GHJUDGDWLRQ ILW WKH GDWD EHWWHU WKDQ GLG WKH VLPXODWLRQ WKDW H[FOXGHG GHJUDGDWLRQ )LJXUH f 7KH ELFRQWLQXXP PRGHO ZLWK ILUVWRUGHU GHJUDGDWLRQ NLQHWLFV DGHTXDWHO\ GHVFULEHG QRQHTXLOLEULXP VRUSWLRQ DQG ELRGHJUDGDWLRQ RI FKORURVWULD]LQH KHUELFLGHV LQ VRLO FROXPQV *DPHUGLQJHU HW DO f 7KHUH KDYH EHHQ PDQ\ LQYHVWLJDWLRQV RQ WKH LPSDFW RI FRQWDPLQDQW VRUSWLRQ RQ ELRGHJUDGDWLRQ *XHULQ DQG %R\G *UHHU DQG 6KHOWRQ f 2IWHQ D FRPSDULVRQ LV PDGH RI FRQWDPLQDQW ELRGHJUDGDWLRQ LQ SXUH FXOWXUHV YHUVXV VRLOEDFWHULDO VXVSHQVLRQV DW GLIIHUHQW PDVV WR YROXPH UDWLRV 8QGHUVWDQGLQJ WKH VRUSWLRQ PHFKDQLVPV DQG ORFDWLRQ LV FUXFLDO WR FRUUHFWO\ LQWHUSUHWLQJ H[SHULPHQWDO UHVXOWV 7R LOOXVWUDWH WKLV SRLQW WKH LQIOXHQFH RI UHYHUVLEOH DQG LUUHYHUVLEOH VRUSWLRQ RQ ELRGHJUDGDWLRQ ZLOO EH GLVFXVVHG 6RUSWLRQ RI +2&V LV FRQVLGHUHG WR EH D UHYHUVLEOH SURFHVV &KLRX HW DO f 7KHUHIRUH DW VRPH SRLQW LQ WLPH WKH FRQWDPLQDQW ZLOO EH UHOHDVHG LQ WR

PAGE 124

5HODWLYH &RQFHQWUDWLRQ &&f )LJXUH 0HDVXUHG DQG VLPXODWHG %7&V IRU 7 GHYHORSHG ZLWK WKH WZR UHJLRQ PRGHO IRU WKH WZR FDVHV RI QR GHJUDGDWLRQ P f DQG GHJUDGDWLRQ cMO!f )URP *DPHUGLQJHU HW DO f

PAGE 125

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f ,QSXW SDUDPHWHUV NE PDVV WR YROXPH UDWLRV .Sf ZHUH REWDLQHG IURP H[SHULPHQWV E\ *XHULQ DQG %R\G f 5DWH FRHIILFLHQWV ZHUH FDOFXODWHG IURP WKH N.S UHODWLRQVKLS %UXVVHDX HW DO f $Q H[DPSOH RI D FDVH ZKHUH GHVRUSWLRQ OLPLWV ELRGHJUDGDWLRQ RI FRQWDPLQDQWV LV SUHVHQWHG LQ )LJXUH 7KH WRWDO DPRXQW GHJUDGHG LV FRQVWDQW DW DOO PDVV WR YROXPH UDWLRV KRZHYHU ELRGHJUDGDWLRQ UDWHV GHFUHDVHG XSRQ LQFUHDVLQJ WKH PDVV RI VRLO LQ WKH VXVSHQVLRQ $QRWKHU H[DPSOH RI VRUSWLRQ GHFUHDVLQJ ELRGHJUDGDWLRQ UDWHV ZDV SUHVHQWHG E\ &KXQJ HW DO f ZKHUH WKH LPSRUWDQFH RI WKH ORFDWLRQ RI WKH FRQWDPLQDQW DQG WKH PLFURRUJDQLVPV ZHUH LQFRUSRUDWHG LQWR WKH PRGHO 6RUSWLRQ RFFXUUHG ZLWKLQ LQWHULRU UHJLRQV RI FOD\ DJJUHJDWHV DQG VPDOOGLDPHWHU SRUHV H[FOXGHG PLFURRUJDQLVPV IURP HQWHULQJ WKH DJJUHJDWH 7KHUHIRUH GLIIXVLRQ RI FRQWDPLQDQWV RXW RI WKH DJJUHJDWHV OLPLWHG ELRGHJUDGDWLRQ UDWHV DOWKRXJK WKH WRWDO DPRXQW GHJUDGHG ZDV FRQVWDQW ,I VRUSWLRQ LV LUUHYHUVLEOH DV VKRZQ IRU GLTXDW WKH VRUEHGSKDVH

PAGE 126

)UDFWLRQ 0LQHUDOL]HG 7LPH PLQf )LJXUH 6LPXODWLRQ RI QDSKWKDOHQH GHJUDGDWLRQ LQ VRLO VXVSHQVLRQV 7KH OLQHV ZHUH JHQHUDWHG XVLQJ WKH ELFRQWLQXXP PRGHO ZLWK ILUVW RUGHU ELRGHJUDGDWLRQ NLQHWLFV PRGHO LQSXW SDUDPHWHUV IURP *XHULQ DQG %R\G f

PAGE 127

FRQWDPLQDQW PD\ EH UHQGHUHG XQDYDLODEOH WR EDFWHULD ,UUHYHUVLEOH VRUSWLRQ UHGXFHV WKH WRWDO DPRXQW RI FRQWDPLQDQW DYDLODEOH IRU GHJUDGDWLRQ 7KLV VWDWHPHQW LV EDVHG RQ WKH DVVXPSWLRQ WKDW WKH FRQWDPLQDQW PXVW H[LVW LQ VROXWLRQ SULRU WR LQWUDFHOOXODU XSWDNH ,I VSHFLILF LQWHUDFWLRQV EHWZHHQ WKH VRUEHQW DQG WKH FRQWDPLQDQW RFFXU VXFK DV H[SHFWHG ZLWK TXLQROLQH &KDSWHU f DQG DV GHPRQVWUDWHG IRU GLTXDW :HEHU DQG &REOH f WKH WRWDO DPRXQW RI FRQWDPLQDQW GHJUDGHG ZLOO EH OLPLWHG E\ WKH IUDFWLRQ WKDW LV LUUHYHUVLEO\ VRUEHG )LJXUH GHSLFWV WKH LUUHYHUVLEOH VRUSWLRQ N f DQG ELRGHJUDGDWLRQ RI D FRQWDPLQDQW GDWD XVHG IURP QDSKWKDOHQHf 7KH GHFUHDVH LQ WKH SODWHDX YDOXH LV LQGLFDWLYH RI VRUSWLRQ UHQGHULQJ FRQWDPLQDQWV XQDYDLODEOH IRU ELRGHJUDGDWLRQ 7KHVH H[DPSOHV LOOXVWUDWH WKH LPSRUWDQFH RI XQGHUVWDQGLQJ WKH VRUSWLRQ PHFKDQLVP DQG KRZ WR LQWHUSUHW WKH UHVXOWV *XHULQ DQG %R\G f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f ZDV MXGJHG WR EH HIIHFWLYH LQ GHJUDGLQJ RQO\ WKH VROXWLRQSKDVH QDSKWKDOHQH VXEVHTXHQW WR GHVRUSWLRQ 7KH LVRODWH

PAGE 128

)UDFWLRQ 0LQHUDOL]HG )LJXUH 6LPXODWLRQ XVLQJ WKH ELFRQWLQXXP PRGHO ZLWK ILUVW RUGHU ELRGHJUDGDWLRQ NLQHWLFV DVVXPLQJ LUUHYHUVLEOH VRUSWLRQ

PAGE 129

7,0( PLQf )LJXUH 1DSKWKDOHQH PLQHUDOL]DWLRQ IRU VWUDLQ 13$ON LQ D VRLO IUHH Rf &ROZRRG Df DQG 2VKWHPR Ef VRLO VOXUULHV ZLWK kf Â’f RU f PJP/ )URP *XHULQ DQG %R\G f

PAGE 130

7(0( PLQf )LJXUH 1DSKWKDOHQH PLQHUDOL]DWLRQ WLPH FRXUVHV IRU VWUDLQ LQ D VRLOIUHH FRQWURO DQG &DSDF Df DQG &ROZRRG VRLO VXVSHQVLRQV )URP *XHULQ DQG %R\G f

PAGE 131

)LJXUH f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f IRU QDSKWKDOHQH PLQHUDOL]DWLRQ E\ WKH LVRODWH ZLWKRXW DVVLJQLQJ XQLTXH SK\VLRORJLF DWWULEXWHV WR WKH PLFURRUJDQLVPV 'HVRUSWLRQOLPLWHG ELRGHJUDGDWLRQ LV FKDUDFWHUL]HG E\ VORZHU UDWHV RI DSSURDFK WR D JLYHQ SODWHDX YDOXH LH FRQVWDQW DPRXQW GHJUDGHGf DV WKH PDVV LQ WKH V\VWHP LV LQFUHDVHG $IWHU UHYLHZLQJ WKHLU GDWD GHVFULELQJ WKH EHKDYLRU RI QDSKWKDOHQH LQ WKH SUHVHQFH RI WKH 13$ON LVRODWH )LJXUH f EHFRPHV PRUH FKDOOHQJLQJ WKDQ WKH W\SLFDO GHVRUSWLRQOLPLWHG GHJUDGDWLRQ )LJXUH f 1DSKWKDOHQH VRUSWLRQ E\ RUJDQLF PDWWHU RI WKHVH VRLOV OLNHO\ RFFXUV YLD K\GURSKRELF SDUWLWLRQLQJ LQ LQWHULRU UHJLRQV RI WKH RUJDQLF PDWWHU PDWUL[ 6(0 SKRWRJUDSKV &KDSWHU f LQGLFDWH WKDW WKH LQWHULRU VRUEHQW UHJLRQV DUH LQDFFHVVLEOH WR PLFURRUJDQLVPV 7KHUHIRUH VFDYHQJLQJ RI QDSKWKDOHQH GLUHFWO\ RII WKH VXUIDFH PD\ QRW EH SRVVLEOH GXH WR SK\VLFDO FRQVWUDLQWV VHSDUDWLQJ WKH PLFURRUJDQLVP IURP WKH FRQWDPLQDQW 7KH NLQHWLF GDWD IRU QDSKWKDOHQH ELRGHJUDGDWLRQ E\ WKH 13$ON LVRODWH

PAGE 132

DSSHDU WR VXJJHVW WKDW HLWKHU VRUSWLRQ LV SUDFWLFDOO\ LUUHYHUVLEOH XQWHQDEOH JLYHQ WKH ZHLJKW RI HYLGHQFH RI SXEOLVKHG GDWDf RU WKDW WKH VRUEHGSKDVH QDSKWKDOHQH LV LQ IDFW XQDYDLODEOH WR WKLV LVRODWH FRQWUDU\ WR WKH FRQFOXVLRQ UHDFKHG E\ *XHULQ DQG %R\G f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f 7KH\ VXJJHVWHG WKDW WKH LPSDFW RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ ZDV QRW GLUHFWO\ GHPRQVWUDWHG EXW ZDV FRQIRXQGHG E\ VHFRQGDU\ HIIHFWV 7KH VRLODTXLIHU HQYLURQPHQW LV KLJKO\ FRPSOH[ 6XUIDFHV SURYLGH PHGLD IRU DWWDFKPHQW DQG FRORQL]DWLRQ RI EDFWHULD 'XULQJ FRORQL]DWLRQ EDFWHULDO DFWLYLW\ LV OLNHO\ DOWHUHG %DFWHULD DWWDFKHG WR SDUWLFOHV DUH JHQHUDOO\

PAGE 133

PRUH DFWLYH WKDQ QRQDWWDFKHG EDFWHULD VHH *ULIILWK DQG )OHWFKHU IRU IXUWKHU UHIHUHQFHVf 3DUWLFOHDVVRFLDWHG EDFWHULD DUH JHQHUDOO\ ODUJHU GXH WR LQFUHDVHG QXWULHQW DQG VXEVWUDWH FRQFHQWUDWLRQV ,ULEHUUL HW DO f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f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

PAGE 134

RQO\ ZLOO WKH EDFWHULDO DFWLYLW\ SRWHQWLDOO\ EH DOWHUHG EXW WKH VRUSWLYH FDSDFLW\ RI TXLQROLQH ZLOO DOVR EH ,QIOXHQFHG VHH &KDSWHU f %DFWHULDO DFWLYLW\ ,Q VROXWLRQ DQG LQ WKH SUHVHQFH RI VXUIDFHV ZLOO EH DGGUHVVHG 4XLQROLQH %LRGHJUDGDWLRQ '\QDPLFV $ FRQFHSWXDOL]DWLRQ RI TXLQROLQH ELRGHJUDGDWLRQ ,V SUHVHQWHG LQ )LJXUH 4XLQROLQH GHJUDGDWLRQ E\ D 3 FHSDFLD 1$f ,VRODWH RFFXUV YLD PHPEUDQH DVVRFLDWHG GHK\GURJHQDVH WKDW IRUPV WKH SULPDU\ PHWDEROLWH +4 7UXH[ HW DO f 7KH VHFRQG VWHS LQYROYHV ULQJ FOHDYDJH RI +4 E\ GLR[\JHQDWLRQ DQG GHK\GURJHQDWLRQ RI WKH EHQ]HQH ULQJ ZLWK WKH HQG SURGXFW EHLQJ & 6PLWK HW DO f UHSRUWHG UDSLG DSSHDUDQFH RI +4 ,Q VROXWLRQ VXJJHVWLQJ WKDW +4 PD\ EH UHOHDVHG ,QWR WKH VROXWLRQSKDVH SULRU WR ,QWUDFHOOXODU XSWDNH 5HOHDVH RI +4 ZDV WKRXJKW WR FRPSHWH ZLWK TXLQROLQH IRU VRUSWLRQ VLWHV 0F%ULGH HW DO 6POWK HW DO f +RZHYHU GDWD SUHVHQWHG ,Q &KDSWHU VXJJHVWHG WKDW +4 GLG QRW UHGXFH TXLQROLQH VRUSWLRQ RYHU D ZLGH S+ UDQJH WR f LQ EDWFK V\VWHPV $OWHUQDWHO\ VRUSWLRQ RI +4 PD\ KDYH EORFNHG TXLQROLQH VRUSWLRQ VLWHV WKHUHE\ UHGXFLQJ TXLQROLQH VRUSWLRQ 0F%ULGH HW DO f 'HJUDGDWLRQ RI TXLQROLQH YLD D PHPEUDQHPHGLDWHG SDWKZD\ IDFLOLWDWHV UDSLG GHJUDGDWLRQ VHFRQGV WR PLQXWHVf DQG FUHDWHV H[SHULPHQWDO GLIILFXOWLHV ZKHQ XVLQJ FROXPQ WHFKQLTXHV *LYHQ VXFK FRQVWUDLQWV 0F%ULGH HW DO f XVHG FP ORQJ JODVV EHDG FROXPQV DQG FOD\PRGOIOHG DOXPLQD FROXPQV ZLWK KLJK SRUHZDWHU YHORFLWLHV WR IDFLOLWDWH PRQLWRULQJ TXLQROLQH VRUSWLRQ DQG ELRGHJUDGDWLRQ

PAGE 135

&OD\ 0LFURRUJDQLVP ORMOSM 9 1RW 'UDZQ WR 6FDOH )LJXUH &RQFHSWXDOL]DWLRQ RI TXLQROLQH ELRGHJUDGDWLRQ LQ WKH SUHVHQFH RI VPHFWLWH FOD\ PLQHUDOV

PAGE 136

6RUSWLRQ RI TXLQROLQH RQWR D VPHFWLWH FOD\ PLQHUDO LV FRQFHSWXDOL]HG WR LOOXVWUDWH WKH ELRDYDLODELOLW\ RI TXLQROLQH WR WKH 1$ LVRODWH )LJXUH f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f EDFWHULD DUH WRR ODUJH WR HQWHU WKH VRUEHQW PDWUL[ ZKHUH WKH PDMRULW\ RI TXLQROLQH UHVLGHV DQG f IRUPDWLRQ RI TXLQROLQH VXUIDFH FRPSOH[HV RQ WKH VRUEHQW PDWUL[ OLNHO\ UHQGHUV TXLQROLQH XQDYDLODEOH IRU ELRGHJUDGDWLRQ ,Q SXUH FXOWXUHV LQGXFWLRQ RI WKH 1$ LVRODWH RQ +4 UHVXOWHG LQ UDSLG XWLOL]DWLRQ RI TXLQROLQH LQGLFDWLQJ WKDW WKH LQLWLDO R[\JHQDVH UHDFWLRQV DUH FRRUGLQDWHO\ UHJXODWHG %URFNPDQ HW DO f ([WUDFHOOXODU HQ]\PHV 1$ ILOWUDWHf DQG GLVUXSWHG FHOOV ZHUH QRW DEOH WR GHJUDGH TXLQROLQH 7KHUHIRUH TXLQROLQH HQ]\PHV FDQQRW EH LQGXFHG ZLWKRXW D TXLQROLQH WUDQVSRUW RU UHFRJQLWLRQ IXQFWLRQ $GGLWLRQ RI VXUIDFWDQWV PHPEUDQH PRGLILHUf HQDEOHG PXWDQW LVRODWHV QR TXLQROLQH GHJUDGDWLRQf WR VXEVHTXHQWO\ GHJUDGH TXLQROLQH E\ LQFUHDVLQJ WKH PHPEUDQH SHUPHDELOLW\ %URFNPDQ HW DO f VXJJHVWHG WKDW LQLWLDWLRQ RI ELRGHJUDGDWLRQ RFFXUV DV WKH UHVXOW RI D SHULSODVPLF ELQGLQJ

PAGE 137

SURWHLQ RU D F\WRSODVPLF PHPEUDQH WUDQVSRUW SURWHLQ WKDW LQWHUDFWV VSHFLILFDOO\ ZLWK TXLQROLQH $OWHUQDWHO\ D SRVLWLYHO\ FRQWUROOHG UHJXODWRU\ SURWHLQ WKDW LQWHUDFWV ZLWK TXLQROLQH SURPRWHV LQGXFWLRQ 8QGHUVWDQGLQJ IDFWRUV WKDW LQIOXHQFH EDFWHULDO SK\VLRORJ\ LV HVVHQWLDO IRU SUHGLFWLQJ WKH SRWHQWLDO IRU ELRGHJUDGDWLRQ 7KH EDFWHULDO LVRODWH 1$ LV D VWULFW DHUREH FDSDEOH RI XWLOL]LQJ TXLQROLQH DV D VROH VRXUFH RI QLWURJHQ FDUERQ DQG HQHUJ\ %URFNPDQ HW DO f ,Q VRLOV VHGLPHQWV DQG DTXLIHU PDWHULDOV PLFURVLWHV RU FRPSOHWH UHJLRQV PD\ EH GHYRLG RI R[\JHQ 1HDUILHOG UHJLRQV RI FRQWDPLQDWHG ZDVWH GLVSRVDO VLWHV PD\ EH GHSOHWHG RI R[\JHQ DV D UHVXOW RI FRQVXPSWLRQ E\ DHURELF EDFWHULD XSRQ ELRGHJUDGDWLRQ DQG RYHU WLPH QHDUILHOG UHJLRQV PD\ VXSSRUW RQO\ DQDHURELF PLFURELDO FRPPXQLWLHV 0DF4XDUULH DQG 6XGLFN\ f +LJK FRQWDPLQDQW FRQFHQWUDWLRQV PD\ DOVR OLPLW PLFURELDO GHJUDGDWLRQ GXH WR WR[LF RU LQKLELWLRQ 7UXH[ HW DO f /RFDOL]HG DUHDV VXSSRUWLQJ EDFWHULDO JURZWK FDXVH WKH GHYHORSPHQW RI EDFWHULDO ELRILOPV LH PXOWLOD\HU DFFXPXODWLRQ RI EDFWHULDO ELRPDVV LQ UHVSRQVH WR KLJK QXWULHQW DQG VXEVWUDWH FRQFHQWUDWLRQVf :LWKLQ WKHVH ELRILOPV PLFURELDO SRSXODWLRQV VSHFLHV DQG QXPEHUVf PD\ FKDQJH LQ UHVSRQVH WR YDULDWLRQV LQ R[\JHQ DQG QXWULHQW FRQWHQWV DV WKH VRLO VXUIDFH LV DSSURDFKHG )RU H[DPSOH ELRGHJUDGDWLRQ UDWHV RI TXLQROLQH SHU XQLW ELRPDVV RI WKH 1$ LVRODWH PD\ EH UHGXFHG LI ELRILOPV WKXV DQDHURELF UHJLRQV DUH IRUPHG $Q DSSURSULDWH DQDORJ\ PD\ EH WKH VLPSOH JURZWK RI D EDFWHULDO FRORQ\ RQ DQ DJDU SODWH %DFWHULD ORFDWHG DURXQG WKH SHULPHWHU RI WKH FRORQ\ DUH DFWLYHO\ JURZLQJ

PAGE 138

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f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f 1XWULHQWV PD\ EH

PAGE 139

UHDGLO\ DYDLODEOH LQ WKH VRLO VROXWLRQ SURYLGHG WKH VRLO LV ULFK LQ RUJDQLF PDWWHU RU SK\OORVLOLFDWH PLQHUDOV ZKLFK PD\ UHOHDVH HVVHQWLDO QXWULHQWV 6WRW]N\ f ,I QXWULHQWV DUH XQDYDLODEOH SUHFLSLWDWHG RU ERXQGf EDFWHULD PD\ IDFLOLWDWH WKH UHOHDVH DQG XSWDNH RI QXWULHQWV E\ H[FUHWLQJ RUJDQLF DFLGV 6WXFNL HW DO f +RZHYHU ROLJRWURSKLF HQYLURQPHQWV LH ORZ QXWULHQW DQG VXEVWUDWH FRQFHQWUDWLRQVf W\SLFDO RI GHHS VXEVXUIDFH DTXLIHUV FDXVH EDFWHULD WR EHFRPH SK\VLRORJLFDOO\ VWUHVVHG DQG WKHLU PHWDEROLF DFWLYLW\ UHGXFHG 8SRQ DGGLWLRQ RI VXEVWUDWHV HQ]\PHV PXVW EH LQGXFHG WR SURPRWH VXEVWUDWH XWLOL]DWLRQ 7KH LQGXFWLRQ WLPH LH WLPH UHTXLUHG WR SURGXFH +4f IRU WKH 1$ LVRODWH JURZLQJ RQ TXLQROLQH LQ ODERUDWRU\ JODVV EHDG FROXPQV YDULHG ZLWK WKH GXUDWLRQ RI VWDUYDWLRQ LH SK\VLRORJLFDO VWDWH RI WKH RUJDQLVPf DQG WKH VXEVWUDWHFRQWDPLQDQW FRQFHQWUDWLRQ 6WDUYHG FHOOV PRUH FRPSOHWHO\ GHJUDGHG TXLQROLQH XWLOL]LQJ WKH VXEVWUDWH HIILFLHQWO\ ,Q WKHVH VWXGLHV EDFWHULD ZHUH SULPDULO\ DWWDFKHG RQWR JODVV EHDGV ZKLOH TXLQROLQH UHPDLQHG LQ VROXWLRQ 5HVHDUFK 4XHVWLRQ DQG 7DVNV 0DQ\ VWXGLHV KDYH EHHQ FRQGXFWHG WR H[DPLQH WKH LQIOXHQFH RI VRUSWLRQ RQ ELRGHJUDGDWLRQ 7KH IROORZLQJ TXHVWLRQV UHODWHG WR WKLV LVVXH DUH SURSRVHG IRU WKLV FKDSWHU f :KDW SURFHVVHV DUH LPSRUWDQW LQ FRXSOLQJ VRUSWLRQ ELRGHJUDGDWLRQ DQG WUDQVSRUW RI RUJDQLF FRQWDPLQDQWV LQ VRLOV DTXLIHUV DQG VHGLPHQWV" DQG f 'R VXUIDFHV LQIOXHQFH EDFWHULDO DFWLYLW\" 7R DGGUHVV WKHVH TXHVWLRQV PLVFLEOH GLVSODFHPHQW WHFKQLTXHV DQG D FRQWLQXRXVO\ VWLUUHG IORZn WKURXJK UHDFWRU &6)75f ZHUH XWLOL]HG DQG OLWHUDWXUH GDWD ZHUH UHDVVHVVHG

PAGE 140

&ROXPQ H[SHULPHQWV ZHUH FRQGXFWHG WR GHWHUPLQH WKH LPSRUWDQFH RI R[\JHQ DQG QXWULHQW FRQWHQWV RQ TXLQROLQH ELRGHJUDGDWLRQ 7KH &6)75 ZDV GHVLJQHG WR PHDVXUH UDSLG ELRGHJUDGDWLRQ NLQHWLFV DQG WR DVVHVV WKH LPSDFW RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ 7KH &6)75 KDV WZR DGYDQWDJHV RYHU PLVFLEOH GLVSODFHPHQW WHFKQLTXHV f WKH &6)75 LV FRPSOHWHO\ PL[HG DQG PLQLPL]HV SK\VLFDO QRQHTXLOLEULXP DQG f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f ZDV XVHG IRU WKH FROXPQ H[SHULPHQWV $Q LVRODWHG SDUWLFOH VL]H IUDFWLRQ MXPf ZDV XVHG IRU WKH &6)75 VWXGLHV 7KLV SURFHGXUH LQFUHDVHG WKH VRUSWLRQ FDSDFLW\ FPROfNJf DQG PLQLPL]HG WKH SRWHQWLDO IRU PLJUDWLRQ RI VRLO SDUWLFOHV WKURXJK WKH RXWOHW ILOWHU QPf 7KH VRLO ZDV VWRUHG LQ VXVSHQVLRQ OLTXLGVROLGf 3ULRU WR HDFK H[SHULPHQW WKH 1RUERUQH FOD\ DQG VLOW VXVSHQVLRQ ZDV HTXLOLEUDWHG ZLWK 1 &D&, DW WKH GHVLUHG S+ XQWLO WKH HIIOXHQW S+ UHPDLQHG FRQVWDQW

PAGE 141

6ROXWHV 6ROXWHV DQG VSHFLILF PHWKRGV RI DQDO\VLV XVHG LQ WKHVH H[SHULPHQWV DUH OLVWHG LQ &KDSWHU %DFNJURXQG PDWUL[ VROXWLRQV 0 &D&,f ZHUH ILOWHU VWHULOL]HG MXPf WR PLQLPL]H ELRGHJUDGDWLRQ RI TXLQROLQH &ROXPQ 6WXGLHV 7KH 1RUERUQH VRLO IRU EDFWHULDLQRFXODWHG FROXPQV ZHUH LQRFXODWHG FIXJf DQG SDFNHG DV GHVFULEHG LQ &KDSWHU 7KH HIIOXHQW IURP D VWHULOHn 1RUERUQH VRLO FROXPQ ZDV FROOHFWHG IRU XVH DV D QXWULHQW PHGLD IRU WKH 1$ LVRODWH ELRGHJUDGDWLRQ VWXGLHV $GGLWLRQDO )H6 PJ/f ZDV DGGHG WR WKH QXWULHQW VROXWLRQ LQWURGXFHG LQWR WKH VRLO FROXPQ WR HQKDQFH EDFWHULDO JURZWK 'LVVROYHG R[\JHQ '2f FRQWHQWV ZHUH YDULHG E\ FKDQJLQJ WKH SRUH ZDWHU YHORFLW\ DQG PRQLWRUHG E\ D '2 SUREH DW WKH FROXPQ RXWOHW VHH &KDSWHU f %LRGHJUDGDWLRQ ZDV PRQLWRUHG TXLQROLQH DQG +4f GXULQJ WKH LQLWLDO TXLQROLQH EUHDNWKURXJK DQG IROORZLQJ WKH IORZ LQWHUUXSWLRQ &6)75 7KH &6)75 )LJXUH f ZDV GHVLJQHG WR PHDVXUH UDSLG NLQHWLFV RI TXLQROLQH GHJUDGDWLRQ DQG VRUSWLRQ LQ WKH DEVHQFH RI GLIIXVLRQDO FRQVWUDLQWV 7KH UHDFWRU FRQVLVWHG RI D P/ VWDLQOHVV VWHHO F\OLQGHU *HOPDQ /DERUDWRULHVf ZLWK D VWDLQOHVV VWHHO VKDIW DQG D WHIORQ SURSHOOHU FRXSOHG WR D USP PRWRU *UDLQJHUf 7KH VKDIW ZDV VXSSRUWHG E\ D VWDLQOHVV VWHHO DQG D WHIORQ VSDFHU ZKLFK FRQWDLQHG WZR %XQD1RULQJV 0F0DVWHU&DUUf WR SUHYHQW OHDNDJH

PAGE 142

" $ VWDLQOHVV VWHHO VKDIW % %XQD1 VLQJV & PDULQH W\SH SURSHOOHU WLWDQLXP SP ILOWHUV ( LQOHW ) RXWOHW )LJXUH 6FKHPDWLF RI &6)75 V\VWHP XVHG WR PRQLWRU TXLQROLQH ELRGHJUDGDWLRQ

PAGE 143

6ROXWLRQV ZHUH SXPSHG LQWR WKH LQOHW SRUW ZLWK *LOVRQ 0RGHO f SXPS DW D FRQVWDQW YHORFLW\ 7KH RXWOHW SRUW FRQVLVWHG RI D VHULHV RI WZR [P WLWDQLXP ILOWHUV 0RWW 0HWDOOXUJLFDOf ZLWK D JODVV PHPEUDQH ILOWHU [Pf LQ EHWZHHQ WR PLQLPL]H VRLO DQG EDFWHULDO ELRPDVV ORVV 7KH HIIOXHQW IUDFWLRQV WR PLQf ZHUH FROOHFWHG DQG DQDO\]HG E\ +3/& RU UDGLRDVVD\ WHFKQLTXHV &KDSWHU f 6RLO VXVSHQVLRQV POB RI D JP/ VXVSHQVLRQf ZHUH DGGHG WR WKH UHDFWRU DQG WKH VWDLQOHVV VWHHO HQGFDS ZUDSSHG ZLWK WHIORQ WDSHf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m f RQ WKH 1RUERUQH VRLO 7KH VRUSWLRQ ELRGHJUDGDWLRQ DQG WUDQVSRUW RI FRQWDPLQDQWV LQ WKH &6)75 ZHUH PRGHOHG DVVXPLQJ WKH HTXLOLEULXP VRUSWLRQ DQG ILUVWRUGHU ELRGHJUDGDWLRQ NLQHWLFV 7KH FKDQJH LQ PDVV LQ WKH &6)75 LV JLYHQ DV IROORZV

PAGE 144

A T4&f NE9& f RI ZKHUH 0 9& P6 9 YROXPH RI WKH &6)75 P WKH PDVV RI VRLO & FRQFHQWUDWLRQ LQ VROXWLRQ &4 LQLWLDO FRQFHQWUDWLRQ RI WKH ,QSXW VROXWLRQ W WLPH NE ELRGHJUDGDWLRQ UDWH FRHIILFLHQW DQG T IORZ UDWH 7KH QRQGOPHQVORQDOL]HG HTXDWLRQ ,V ZULWWHQ DV 5f§ &rf\&r rf GS ZKHUH 5 f§.G &rf§ \ 9 G &f U N9 M T S 9 %LRGHJUDGDWLRQ RI TXLQROLQH WR +4 ,V UHSUHVHQWHG E\ G& GS &Tf <4AE f DQG ELRGHJUDGDWLRQ RI +4 WR RWKHU PHWDEROLWHV JLYHQ WKH TXLQROLQH LQSXW FRQFHQWUDWLRQ EDVHG RQ HT LV UHSUHVHQWHG E\ UKT G&P GS
PAGE 145

7KH VROXWLRQ DVVXPLQJ WUDQVLHQW EHKDYLRU RI TXLQROLQH LV JLYHQ E\ S\Tf H 5T f r4 =
PAGE 146

7DEOH 1XWULHQW FRQFHQWUDWLRQ PJ/f H[WUDFWHG IURP WKH 1RUERUQH VRLO FROXPQ ,RQ 0J 3 =Q &X 0Q $O )H 1D % 3E &RQH LQGLJHQRXV HQYLURQPHQW 7KH VRLO HIIOXHQW DQDO\VLV VXJJHVWHG WKDW QLWURJHQ QRW VKRZQf DQG )H FRQFHQWUDWLRQV PD\ EH OLPLWLQJ +RZHYHU TXLQROLQH FDQ EH XWLOL]HG DV VROH VRXUFH RI QLWURJHQ DQG WKH VRLO OLNHO\ FRQWDLQV VXIILFLHQW DPRXQWV RI )H LI LW LV FRQWLQXDOO\ UHOHDVHG IURP WKH VRLO PDWUL[ =DFKDUD HW DO f *URZWK UDWHV RI WKH 1$ LVRODWH LQGXFHG RQ VRLO FROXPQ HIIOXHQW ZHUH QRW TXDQWLWDWLYHO\ PHDVXUHG KRZHYHU SURGXFWLRQ RI SLQN PHWDEROLWHV GHDGHQG PHWDEROLWHVf DQG WXUELG FXOWXUHV FIXP/f ZHUH SURGXFHG DIWHU DERXW GD\V IURP XVH RI WKH VRLO FROXPQ HIIOXHQW LQ 0 &D&,f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f IRU LQGXFLQJ WKH 1$ LVRODWH ZDV XVHG LQ DOO &6)75 H[SHULPHQWV

PAGE 147

&ROXPQ %LRGHJUDGDWLRQ 6WXGLHV $GDSWDWLRQ $GDSWDWLRQ RI WKH 1$ LVRODWH WR FROXPQ FRQGLWLRQV ZDV UHTXLUHG WR SURPRWH GHJUDGDWLRQ RI TXLQROLQH WR +4 GHVSLWH WKH IDFW WKDW WKLV LVRODWH KDG EHHQ LQGXFHG RQ TXLQROLQH DQG WKH VRLO FROXPQ HIIOXHQW )LJXUH f $QDO\VLV RI WKH HIIOXHQW XVLQJ +3/& WHFKQLTXHV YHULILHG WKDW TXLQROLQH ZDV QRW GHJUDGHG LQ WKH FROXPQ GXULQJ WKH ILUVW KRXUV 7KH IORZ UDWH ZDV P/PLQ DQG WKH DGDSWDWLRQ WLPH ZDV JUHDWHU WKDQ WKH UHVLGHQFH WLPH a PLQf 7R LQGXFH GHJUDGDWLRQ D IORZ LQWHUUXSWLRQ ZDV FRQGXFWHG IRU KRXUV DQG WKH IORZ ZDV UHVWDUWHG DW P/PLQ WR HQKDQFH WKH LQWHUDFWLRQ EHWZHHQ WKH 1$ LVRODWH DQG TXLQROLQH $IWHU WKH IORZ LQWHUUXSWLRQ +4 ZDV GHWHFWHG LQ WKH FROXPQ HIIOXHQW 7KH EDFWHULD LQ WKHVH VRLO FROXPQV ZHUH LQLWLDOO\ LQGXFHG RQ TXLQROLQH KRZHYHU DIWHU HTXLOLEUDWLRQ ZLWK WKH VRLO IRU KRXUV GXULQJ VDWXUDWLRQf WKH 1$ LVRODWH UHTXLUHG DQ DGDSWDWLRQ WR TXLQROLQH 7KLV VXJJHVWV WKDW LQ VRLO DQG DTXLIHU PDWHULDOV ELRGHJUDGDWLRQ PD\ EH LQLWLDOO\ OLPLWHG E\ WKH WLPH QHFHVVDU\ IRU HQ]\PH LQGXFWLRQ 7UXH[ HW DO f VXJJHVWHG WKDW WKH WLPH IRU EDFWHULDO LQGXFWLRQ RQ TXLQROLQH PJ/f GHFUHDVHG IURP WR KRXUV IRU FHOOV VWDUYHG IRU YHUVXV m GD\V 7KHLU EDFWHULDO LVRODWH ZDV GHSOHWHG RI QXWULHQWV FDUERQ DQG HQHUJ\ VRXUFHV LQ D VDOLQH VROXWLRQ IRU WKH DOORWWHG WLPH DQG SDFNHG LQWR D JODVVEHDG FROXPQ ,Q WKLV VWXG\ WKH 1$ FHOOV ZHUH DGGHG GLUHFWO\ IURP WKH QXWULHQW VROXWLRQ WR WKH 1RUERUQH VRLO $W WKLV WLPH &D&, VROXWLRQ ZDV LQWURGXFHG WR VDWXUDWH WKH VRLO FROXPQ 7KH UHVLGXDO TXLQROLQH FRQFHQWUDWLRQ LQWURGXFHG ZLWK

PAGE 148

WKH EDFWHULDO LVRODWH GXULQJ LQRFXODWLRQ ZDV MXJJ 4XLQROLQH ELRGHJUDGDWLRQ ZDV VKRZQ WR RFFXU DW FRQFHQWUDWLRQV DV ORZ DV cMO J/ 6PLWK HW DO f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f 6RLO FROXPQV DUH FRQFHSWXDOL]HG DV D XQLW YROXPH ZKHUHLQ TXLQROLQH VRUSWLRQ DQG ELRGHJUDGDWLRQ RFFXUV 7KH RXWFRPH LV RQO\ PHDVXUHG LQ WKH FROXPQ HIIOXHQW DQG GRHV QRW SUHVHQW DQ\ LQIRUPDWLRQ DERXW WKH SURILOH RI R[\JHQ RU TXLQROLQH ZLWKLQ WKH FROXPQ %HFDXVH RI WKH UDSLG ELRGHJUDGDWLRQ NLQHWLFV TXLQROLQH PD\ EH GHJUDGHG ZLWKLQ WKH ILUVW FP RI WKH FROXPQ ZKHUH R[\JHQ LV SOHQWLIXO $V WKH R[\JHQ LV OLPLWLQJ DQG WKH TXLQROLQH FRQFHQWUDWLRQ GHFUHDVHV WKH ELRGHJUDGDWLRQ UDWHV PD\ GHFUHDVH

PAGE 149

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f DQG ZDV PRQLWRUHG SHULRGLFDOO\ IRU TXLQROLQH DQG +4 QR ORQJHU GHJUDGHG TXLQROLQH %LRGHJUDGDWLRQ ZLWKLQ WKH VRLO FROXPQ GHFUHDVHG ZKHUHE\ RQO\ b RI WKH TXLQROLQH LQWURGXFHG LQWR WKH FROXPQ ZDV GHJUDGHG WR +4 $IWHUm DGGLWLRQDO SRUH YROXPHV TXLQROLQH ELRGHJUDGDWLRQ KDG FHDVHG 7KH DEVHQFH RI 1 LQ WKH 1RUERUQH VRLO GLG QRW OLPLW TXLQROLQH ELRGHJUDGDWLRQ LQ WKH VRLO FROXPQ EHLQJ WKH 1$ LVRODWH XWLOL]HG WKH 1 IURP WKH TXLQROLQH PROHFXOH '2 ZDV PJ/ VXJJHVWLQJ WKDW PLFURRUJDQLVPV PD\ EH GRUPDQW RU LQ D UHVWLQJ VWDWH EHFDXVH R[\JHQ ZDV QRW EHLQJ FRQVXPHG 6DPSOLQJ DQG SODWLQJ WKH FROXPQ HIIOXHQW YHULILHG EDFWHULD ZHUH SUHVHQW DW DERXW FIXP/ )H FRQFHQWUDWLRQV LQ WKH VRLO FROXPQ HIIOXHQW VROXWLRQV ZHUH ORZ 7DEOH f 7R FKHFN IRU OLPLWLQJ QXWULHQWV DQ )H6 VROXWLRQ ZDV LQWURGXFHG DQG TXLQROLQH GHJUDGDWLRQ ZHUH PRQLWRUHG )LJXUH f 6WLPXODWLRQ RI TXLQROLQH GHJUDGDWLRQ DQG +4 SURGXFWLRQ XSRQ WKH LQWURGXFWLRQ RI )H VXJJHVWV WKDW WKH 1$ EDFWHULD

PAGE 150

2f 2 H R 6 F R F R m! ( 2 /8 2 2 2 4XLQROLQH p +\GUR[\TXLQROLQH 2 k 2 7LPH KRXUVf )LJXUH 4XLQROLQH ELRGHJUDGDWLRQ LQ D 1RUERUQH VRLO FROXPQ XQGHU PLFURQXWULHQW OLPLWLQJ FRQGLWLRQV

PAGE 151

GHILFLHQW LQ )H +RZHYHU WKH UDWH RI TXLQROLQH GHJUDGDWLRQ DQG +4 SURGXFWLRQ ZDV PXFK VORZHU WKDQ LQ WKH SUHYLRXV VWXGLHV 7KLV VXJJHVWV WKDW RWKHU QXWULHQWV PD\ EH OLPLWLQJ RU WKH PLFURELDO SRSXODWLRQ PD\ KDYH EHHQ DOWHUHG DIWHU H[WHQVLYH ULQVLQJ RI WKH VRLO FROXPQ 4XLQROLQH GHJUDGDWLRQ ZDV UDSLG DW DOO IORZ UDWHV WR P/PLQf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

PAGE 152

ELRGHJUDGDWLRQ NLQHWLFV LQ EDFWHULDO VXVSHQVLRQV )LJXUH f 7KH GDWD DUH QRUPDOL]HG WR WKH LQLWLDO TXLQROLQH LQSXW FRQFHQWUDWLRQ ,PPHGLDWHO\ IROORZLQJ WKH DGGLWLRQ RI WKH 1$ LVRODWH WR WKH &6)75 WKH TXLQROLQH VROXWLRQ ZDV LQWURGXFHG DQG WKH HIIOXHQW VDPSOHG 7KH TXLQROLQH DQG +4 GHWHFWHG LQ WKH &6)75 HIIOXHQW IRU WKH ILUVW WR PLQXWHV ZHUH UHVLGXDO TXLQROLQH DQG ORZHU PHWDEROLWHV UHPDLQLQJ IURP WKH QXWULHQWLQGXFWLRQ VROXWLRQ 4XLQROLQH ELRGHJUDGDWLRQ TXLQROLQH WR +4f DWWDLQHG VWHDG\ VWDWH DERXW PLQXWHV DIWHU TXLQROLQH LQWURGXFWLRQ %LRGHJUDGDWLRQ RI +4 TXLQROLQH WR +4 WR RWKHU PHWDEROLWHVf UHDFKHG VWHDG\ VWDWH LQ DSSUR[LPDWHO\ WKH VDPH WLPH IUDPH 7KH DSSURDFK WR VWHDG\ VWDWH OLNHO\ FRUUHVSRQGV WR WKH DGDSWDWLRQ WLPH DQG EXLOG XS RI GHJUDGDWLYH HQ]\PHV UHTXLUHG IRU WKH 1$ LVRODWH LQ WKH &6)75 7KH TXLQROLQH DQG +4 VROXWLRQ FRQFHQWUDWLRQV ZHUH GHFUHDVHG WR b RI WKH LQLWLDO IHHG FRQFHQWUDWLRQ $JLWDWLRQ GHFUHDVHV EDFWHULDO DFWLYLW\ GXH WR IORFFXODWLRQ DQG GDPDJH WR WKH FHOO DV WKH VWLUULQJ UDWH LQFUHDVHV 6WUDWIRUG DQG :LOVRQ f +RZHYHU FHOO GLVUXSWLRQ ZDV VKRZQ WR LQDFWLYDWH TXLQROLQH GHJUDGDWLRQ %URFNPDQ HW DO f 3ODWLQJ WKH LQWHUQDO FHOO VXVSHQVLRQ RI VKRZHG FIXP/ LQ WKH TXLQROLQH &6)75 $JLWDWLRQ LQ D &6)75 PD\ UHOHDVH HQ]\PHV FDSDEOH RI GHJUDGLQJ WKHUHIRUH WKH FHOO VXVSHQVLRQ ZDV ILOWHUHG DQG HTXLOLEUDWHG ZLWK TXLQROLQH DQG PLQHUDO VDOWV VROXWLRQ 1R PHWDEROLWHV ZHUH REVHUYHG VXJJHVWLQJ WKDW TXLQROLQH GHJUDGDWLRQ UHPDLQV D PHPEUDQH DVVRFLDWHG GHJUDGDWLRQ SURFHVV 6LPLODUO\ IUHH HQ]\PHV ILOWUDWHVf IURP EDWFK V\VWHPV ZHUH QRW DEOH WR GHJUDGH TXLQROLQH %URFNPDQ HW DO f 7KLV

PAGE 153

1RUPDOL]HG WR 4XLQROLQH )LJXUH %LRGHJUDGDWLRQ RI TXLQROLQH DQG SURGXFWLRQ RI +4 E\ WKH 1$ LVRODWH LQ WKH &6)75

PAGE 154

VXJJHVWHG WKDW WKH &6)75 LV DQ DSSURSULDWH WHFKQLTXH IRU PRQLWRULQJ UDSLG ELRGHJUDGDWLRQ NLQHWLFV 8QIRUWXQDWHO\ IRU HYHU\ DGYDQWDJH RI D SDUWLFXODU WHFKQLTXH GLVDGYDQWDJHV DUH ZDLWLQJ WR EH GLVFRYHUHG $IWHU PLQXWHV WKH &6)75 VWDUWHG WR OHDN DURXQG WKH VKDIW )LJXUH f DQG WKH H[SHULPHQW ZDV VWRSSHG $W WKLV SRLQW WKH RULQJV ZLWKLQ WKH V\VWHP ZHUH ZHDULQJ RXW DQG WKH EDFWHULD ZHUH SRWHQWLDOO\ FORJJLQJ WKH P RXWOHW ILOWHU 7KH EXLOG XS LQ SUHVVXUH OLNHO\ FDXVHG WKH V\VWHP WR OHDN $ VHFRQG &6)75 ZDV HTXLOLEUDWHG ZLWK WKH 1$ LVRODWH DQG WKH DERYH H[SHULPHQW UHSHDWHG )LJXUH f ,Q WKHVH H[SHULPHQWV WKH &6)75 ZDV IOXVKHG ZLWK 0 &D&, WR UHPRYH WKH H[FHVV PHWDEROLWHV IURP WKH QXWULHQWLQRFXODWLRQ VROXWLRQ )LJXUH D YHULILHG WKH DSSURDFK WR VWHDG\ VWDWH LQ WKH &6)75 DJUHHV ZLWK REVHUYDWLRQV LQ WKH ILUVW H[SHULPHQW 6WHDG\ VWDWH ZDV DWWDLQHG LQ DERXW PLQXWHV IRU ERWK TXLQROLQH DQG )4 )LJXUH D Ef 9DULDWLRQV LQ EDFWHULDO FXOWXUH FRQGLWLRQV OHQJWK RI WLPH WR LQWURGXFWLRQ LQ WKH &6)75f PD\ KDYH FDXVH D VOLJKW FKDQJH LQ ELRGHJUDGDWLRQ )OHWFKHU f %DFWHULDOVXUIDFH LQWHUDFWLRQV 8WLOL]LQJ SHUWXUEDWLRQ WHFKQLTXHV 'L*UD]LD HW DO f IDFLOLWDWHV HYDOXDWLQJ WKH LQIOXHQFH RI D SDUWLFXODU SDUDPHWHU LQ D FRPSOH[ V\VWHP 7KH LPSDFW RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ KDV ORQJ EHHQ VWXGLHG )ORZHYHU DQ LQFUHDVH LQ QXWULHQW DQG VXEVWUDWH FRQFHQWUDWLRQV ZKHUH ELRGHJUDGDWLRQ LV OLPLWLQJ PD\ FRQIRXQG WKHVH UHVXOWV $ SHUWXUEDWLRQ RI WKH &6)75 ZKHUH EDFWHULD ZHUH DW VWHDG\ VWDWH ZLWK UHVSHFW WR TXLQROLQH DQG ),4 GHJUDGDWLRQ ZRXOG SURYLGH LQVLJKW LQWR WKH LPSDFW RI

PAGE 155

(IIOXHQW &RQFHQWUDWLRQ PJ/f (IIOXHQW &RQFHQWUDWLRQ PJ/f 7LPH PLQf )LJXUH $OWHUDWLRQ RI EDFWHULDO DFWLYLW\ XSRQ LQWURGXFWLRQ RI 1RUERUQH FOD\ DQG VLOW DV PHDVXUHG E\ WKH FKDQJH LQ ELRGHJUDGDWLRQ RI TXLQROLQH

PAGE 156

VXUIDFHV RQ EDFWHULDO DFWLYLW\ $OWHUDWLRQ RI TXLQROLQH DQG +4 EHKDYLRU ZRXOG LQGLFDWH EDFWHULDO DFWLYLW\ KDG EHHQ DOWHUHG LQ WKH SUHVHQFH RI VXUIDFHV 7KH LQIOXHQFH RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ ELRGHJUDGDWLRQf ZDV LQYHVWLJDWHG DIWHU VWHDG\ VWDWH ZDV DWWDLQHG IRU ELRGHJUDGDWLRQ RI TXLQROLQH WR +4 WR RWKHU PHWDEROLWHV $W DQG PLQXWHV )LJXUH D E UHVSHFWLYHO\f J RI WKH 1RUERUQH VLOW DQG FOD\ PL[WXUH ZDV DGGHG LQWR WKH &6)75 $GGLWLRQ RI VXUIDFHV LQ WKLV V\VWHP VPDOO PDVV WR YROXPH UDWLRf GLG QRW FRQWULEXWH VXEVWDQWLDOO\ WR WKH TXLQROLQH VRUSWLRQ 5 f ,I TXLQROLQH VRUSWLRQ ZHUH PHDVXUHG DW KLJKHU PDVV WR YROXPH UDWLRV 5! f GLIIXVLRQDO FRQVWUDLQWV ZRXOG GHFUHDVH GXH WR FRPSOHWH PL[LQJ RI WKH VRLO DQG LQFUHDVH WKH IUDFWLRQ RI LQVWDQWDQHRXV VRUSWLRQ ,Q )LJXUH D DGGLWLRQ RI VRLO LQLWLDOO\ GHFUHDVHG TXLQROLQH DQG +4 GHJUDGDWLRQ 7KH RYHUDOO GHJUDGDWLRQ RI TXLQROLQH DSSHDUHG WR EH UHGXFHG WR DERXW PJ/ 7KH +4 UHDFKHG D FRQFHQWUDWLRQ RI PJ/ IROORZHG E\ D GHFUHDVH WR PJ/ ,Q )LJXUH E WKH UHVSRQVH WR WKH DGGLWLRQ RI VRLO ZDV QRWLFHDEO\ GLIIHUHQW 'HJUDGDWLRQ RI TXLQROLQH GLG QRW DSSHDU WR EH LQIOXHQFHG E\ WKH DGGLWLRQ RI VRLO +4 GHJUDGDWLRQ DSSHDUHG WR EH UHGXFHG VXEVWDQWLDOO\ DQG PDLQWDLQHG D ORZHU GHJUDGDWLRQ UDWH 7KH ELRGHJUDGDWLRQ RI TXLQROLQH WR +4 DQG +4 WR RWKHU PHWDEROLWHV ZDV ILW E\ D ILUVWRUGHU ELRGHJUDGDWLRQ PRGHO DVVXPLQJ VWHDG\ VWDWH FRQGLWLRQV 7KH NE4 ZDV PLQXWHVn DQG WKH NE+4 ZDV PLQXWHVn

PAGE 157

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f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

PAGE 158

+4 FRQFHQWUDWLRQ 'LVUXSWHG FHLOV DQG FHOO ILOWUDWHV HQ]\PHV RQO\f ZHUH LQFDSDEOH RI GHJUDGLQJ TXLQROLQH 7KHUHIRUH GHFUHDVHG DFWLYLW\ LV OLNHO\ DVVRFLDWHG ZLWK WKH EDFWHULDO PHPEUDQH RU VXUIDFH 7KH UHVXOWV VXJJHVW WKDW XSWDNH RI +4 LQWR WKH EDFWHULDO FHOO ZDV UHGXFHG &RYHUDJH RI WKH EDFWHULDO FHOO E\ FOD\ SDUWLFOHV PD\ KDYH PLQLPL]HG +4EDFWHULDO FRQWDFW FDXVLQJ WKH UHGXFHG XSWDNH E\ WKH FHOO ,QFUHDVHG ELRGHJUDGDWLRQ RI +4 PLQ )LJXUH Ef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

PAGE 159

&6)75V SUHVHQW D WHFKQLTXH WR LQYHVWLJDWH UDSLG ELRGHJUDGDWLRQ NLQHWLFV DQG WKH LQWHUDFWLRQ VRUSWLRQ DQG ELRGHJUDGDWLRQ $W WKLV SRLQW LQ WLPH LPSURYHPHQWV LQ WKH &6))5 GHVLJQ DUH QHFHVVDU\ WR IXOO\ XWLOL]H WKLV WHFKQLTXH +RZHYHU VLPSOH PRGLILFDWLRQV VXFK DV ZRUNLQJ ZLWK JODVV YHVVHOV ODUJHU VRUEHQW SDUWLFOHV DQG VORZHU SURSHOOHU VSHHGV PD\ LPSURYH WKLV WHFKQLTXH %LRGHJUDGDWLRQ LV OLNHO\ OLPLWHG E\ WZR IDFWRUV LQ VRLOV DTXLIHUV DQG VHGLPHQWV f EDFWHULDOVRUEHQW DVVRFLDWLRQV DQG f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

PAGE 160

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

PAGE 161

&+$37(5 6800$5< $1' &21&/86,216 6XPPDU\ ,Q WKLV GLVVHUWDWLRQ LQYHVWLJDWHG TXLQROLQHVRLOPLFURRUJDQLVP LQWHUDFWLRQV WKH OLPLWDWLRQV DQG SRWHQWLDO RI ELRUHPHGLDWLRQ SUDFWLFHV 6ROXWH VRUEHQW LQWHUDFWLRQV LQ EDWFK DQG IORZWKURXJK V\VWHPV ZHUH LQYHVWLJDWHG WR GHWHUPLQH UDWHOLPLWHG SURFHVVHV FRQWUROOLQJ ELRDYDLODELOLW\ RI QLWURJHQ KHWHURF\FOLF FRPSRXQGV 1+&Vf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

PAGE 162

UHPHGLDWLRQ SUDFWLFHV" ,V WKH QRQHTXLOLEULXP VRUSWLRQ RI 1+&V DFFXUDWHO\ GHVFULEHG E\ WKH ELFRQWLQXXP PRGHO" 4XLQROLQH D 1+& LV VRUEHG SUHGRPLQDWHO\ RQ FDWLRQ H[FKDQJH VLWHV RQ FOD\ DQG RUJDQLF PDWWHU $V D UHVXOW VRUSWLRQ LV GHSHQGHQW RQ TXLQROLQH VSHFLDWLRQ DV LQIOXHQFHG E\ S+ 4XLQROLQH VRUSWLRQ LV OLPLWHG E\ DFFHVVLELOLW\ RI VLWHV LH VWHULF KLQGUDQFHVf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m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b RI WKH TXLQROLQH LQWURGXFHG

PAGE 163

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f KDYH VKRZQ WKDW WKH WUDQVSRUW RI KLJKO\ VRUSWLYH K\GURSKRELF RUJDQLF FKHPLFDOV +2&Vf HJ ''7 DQG +&%f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f LQ UHJLRQV ZKHUH KLJK EDFWHULDO SRSXODWLRQV FIXP/f H[LVW LQ WKH VROXWLRQ SKDVH /LQGTYLVW DQG (QILHOG f

PAGE 164

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f VXJJHVWHG WKDW VWDUYHG GHFUHDVHG SK\VLRORJLFDO DFWLYLW\f TXLQROLQH GHJUDGHUV UHTXLUHG DERXW KRXUV WR LQLWLDWH GHJUDGDWLRQ DIWHU EHLQJ GHSOHWHG RI QXWULHQWV FDUERQ DQG HQHUJ\ VRXUFHV LQ EDWFK V\VWHPV 7KLV VWXG\ VXJJHVWHG WKDW OHVV WKDQ KRXUV ZHUH UHTXLUHG WR LQLWLDWH ELRGHJUDGDWLRQ LQ VRLOV WKDW FRQWDLQHG HVVHQWLDO QXWULHQWV ,Q WKLV FDVH WKH EDFWHULDO LQRFXOXP ZDV GLUHFWO\ DGGHG WR WKH VRLO SDFNHG LQWR WKH VRLO FROXPQ DQG ZDWHU IORZ ,QLWLDWHG 7KH SUHVHQFH RI QXWULHQWV DQG FDUERQ VRXUFHV OLNHO\ VXVWDLQHG WKH EDFWHULDO DFWLYLW\ DQG UHGXFHG WKH WLPH UHTXLUHG IRU LQGXFWLRQ &RQGXFWLQJ D IORZ LQWHUUXSWLRQ DQG D ORQJHU UHVLGHQFH WLPH YHUVXV PLQXWHVf PD\ KDYH DOVR

PAGE 165

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f 7KH VRLO FROXPQV DW S+ DQG LQGLFDWHG QR GLIIHUHQFH LQ ELRGHJUDGDWLRQ HJ GHJUDGDWLRQ RFFXUUHG SULRU WR UHDFKLQJ WKH FROXPQ RXWOHWf 0LFURRUJDQLVP6RUEHQW ,QWHUDFWLRQV $ &6)75 ZDV GHVLJQHG WR HYDOXDWH UDSLG TXLQROLQH ELRGHJUDGDWLRQ NLQHWLFV DQG WR HYDOXDWH WKH LQIOXHQFH RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ 7KH TXHVWLRQ RI LQWHUHVW IRU WKH &6)75 H[SHULPHQWV DUH :KDW DUH WKH ELRGHJUDGDWLRQ UDWHV IRU TXLQROLQH DQG +4 LQ WKH &6)75" ,V EDFWHULDO DFWLYLW\ LH ELRGHJUDGDWLRQf DOWHUHG LQ WKH SUHVHQFH RI VXUIDFHV" $ &6)75 ZDV GHVLJQHG WR DFKLHYH VWHDG\ VWDWH JURZWK RI TXLQROLQH GHJUDGLQJ PLFURRUJDQLVPV 6WHDG\ VWDWH ZDV DFKLHYHG LQ DERXW PLQXWHV KRZHYHU GXH WR PHFKDQLFDO SUREOHPV WKH &6)75 ZDV PDLQWDLQHG IRU D

PAGE 166

PD[LPXP RI DERXW PLQXWHV &RPSOHWHO\ PL[HG UHDFWRUV ZHUH YHULILHG ZLWK WUDFHUV QRQVRUSWLYH QRQGHJUDGLQJf 7KH &6)75 VXSSRUWHG JURZWK RI LQGLYLGXDO PLFURELDO FRORQLHV ZKLFK DUH WKH SUHGRPLQDQW IRUP RI EDFWHULDO GLVWULEXWLRQ LQ VRLO FROXPQV 7KH XVH RI D &6)75 ZDV SUHYLRXVO\ GHPRQVWUDWHG E\ 'L*UD]LD HW DO f 2XU V\VWHP YDULHG LQ VHYHUDO ZD\V GXH WR UHTXLUHPHQWV RI WKH H[SHULPHQW 7KLV V\VWHP HPSOR\HG D P ILOWHU LQ DWWHPSW WR FRQWDLQ WKH EDFWHULDO ELRPDVV DQG VRUEHQW SDUWLFOHV ZLWKLQ WKH UHDFWRU 7KH &6)75 XVHG E\ 'L*UD]LD HW DO f XWLOL]HG VRLO SDUWLFOHV WKDW ZHUH VLHYHG WR D IUDFWLRQ EHWZHHQ WR cLP DQG ILOWHUV WKDW KDG D SRUH VL]H UDQJLQJ IURP WR 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f RI WKH SULPDU\ PHWDEROLWH K\GUR[\TXLQROLQH

PAGE 167

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

PAGE 168

$HURELF WUDQVIRUPDWLRQ SURFHVVHV UHTXLUH WKH SUHVHQFH RI R[\JHQ IRU ELRGHJUDGDWLRQ ,Q VRLOV VHGLPHQWV DQG DTXLIHUV R[\JHQ FRQWHQWV DUH GHSHQGHQW RQ WKH VRLO W\SH DQG PRLVWXUH FRQWHQW 4XLQROLQH ELRGHJUDGDWLRQ RFFXUUHG UDSLGO\ DW OHYHOV DV ORZ DV PJ/ ,Q VXUIDFH VRLOV SURYLGLQJ DGHTXDWH GUDLQLQJ PD\ IDFLOLWDWH R[\JHQ GLIIXVLRQ DQG VXSSO\ WKH UHTXLUHG OHYHOV RI R[\JHQ IRU ELRGHJUDGDWLRQ ,I FRQWDPLQDQW FRQFHQWUDWLRQV DQG PLFURELDO DFWLYLW\ DUH KLJK R[\JHQ PD\ EH GHSOHWHG HYHQ LQ ZHOOGUDLQHG VRLOV /DQG IDUPLQJ WHFKQLTXHV DOVR LQFUHDVH R[\JHQ FRQWHQWV LQ WKH VXUIDFH VRLO +RZHYHU GHHSHU VRLOV DQG DTXLIHU PDWHULDOV PD\ QHHG R[\JHQ LQMHFWLRQV RU E\ IOXFWXDWLQJ WKH ZDWHU WDEOH E\ ZHOO GUDZ GRZQ WR LQFUHDVH R[\JHQ PL[LQJ $GGLWLRQ RI QXWULHQWV LV UHTXLUHG WR VXVWDLQ JURZWK DQG PHWDEROLVP RI PLFURRUJDQLVPV 7KH FROXPQ VWXGLHV VXJJHVWHG WKDW DIWHU H[WHQVLYH OHDFKLQJ DGGLWLRQ RI )H LQFUHDVHG TXLQROLQH GHJUDGDWLRQ ,Q RIIVKRUH VHDZDWHU ELRGHJUDGDWLRQ RI FUXGH RLO ZDV LQFUHDVHG XSRQ DGGLWLRQ RI )H IHUULF RFWRDWHf DORQJ ZLWK QLWURJHQ DQG SKRVSKRUXV )LHOG VFDOH VWXGLHV VXJJHVWHG DGGLWLRQ RI QXWULHQW VROXWLRQV LQFUHDVHG ELRGHJUDGDWLRQ RI FRPSRQHQWV RI IRVVLO IXHOV 3ULWFKDUG DQG &RVWD f %DFWHULDO $FWLYLW\ LQ WKH 6RUEHG 9HUVXV 6ROXWLRQ3KDVH 6RUSWLRQ RI PLFURRUJDQLVPV WR VRUEHQW VXUIDFHV ZDV VXJJHVWHG WR GHFUHDVH TXLQROLQH ELRGHJUDGDWLRQ LQ V\VWHPV VXSSOLHG ZLWK DGHTXDWH QXWULHQWV $OWHUDWLRQ RI SK\VLRORJLFDO IXQFWLRQV >LH WUDQVSRUW UHFRJQLWLRQ IXQFWLRQV %URFNPDQ HW D f@ OLNHO\ GHFUHDVHG EDFWHULDO DFWLYLW\ DQG UHGXFHG ELRGHJUDGDWLRQ %ORFNDJH

PAGE 169

RI WKH FHOO PHPEUDQH E\ VRUEHQWEDFWHULDO DVVRFLDWLRQV GHFUHDVHG +4 XSWDNH 0RUH ZRUN LV QHHGHG WR VXSSRUW WKLV H[SHULPHQWDWLRQ RQ WKH LQIOXHQFH RI VXUIDFHV RQ EDFWHULDO DFWLYLW\ 'LUHFW LQYHVWLJDWLRQ RI EDFWHULDOVRUEHQW DVVRFLDWLRQV E\ 6(0 GXULQJ VRUSWLRQ DQG ELRGHJUDGDWLRQ H[SHULPHQWV ZRXOG VXEVWDQWLDWH WKH FXUUHQW ILQGLQJV

PAGE 170

5()(5(1&(6 $DPDQG & -RUJHQVHQ ( $UYLQ DQG %. -HQVHQ 0LFURELDO DGDSWDWLRQ WR GHJUDGDWLRQ RI K\GURFDUERQV LQ SROOXWHG DQG XQSROOXWHG JURXQGZDWHU &RQWDLQ +\GURO $LQVZRUWK && -0 =DFKDUD DQG 5/ 6FKPLGW 4XLQROLQH VRUSWLRQ RQ 1DPRQWPRULOORQLWH FRQWULEXWLRQV RI WKH SURWRQDWHG DQG QHXWUDO VSHFLHV &OD\V &OD\ 0LQ $OH[DQGHU 0 DQG .0 6FRZ .LQHWLFV RI ELRGHJUDGDWLRQ LQ VRLO S ,Q %/ 6DZKQH\ DQG %URZQ HGVf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
PAGE 171

%DXJKPDQ */ DQG ') 3DULV 0LFURELDO ELRFRQFHQWUDWLRQ RI RUJDQLF SROOXWDQWV IURP DTXDWLF V\VWHPVD FULWLFDO UHYLHZ &5& &ULWLFDO 5HY 0LFURELRO %DYH\H 3 DQG $ 9DORFFKL $Q HYDOXDWLRQ RI PDWKHPDWLFDO PRGHOV RI WKH WUDQVSRUW RI ELRORJLFDOO\ UHDFWLQJ VROXWHV LQ VDWXUDWHG VRLOV DQG DTXLIHUV :DW 5HVRXU 5HV %D]LQ 037 6DXQGHUV DQG -O 3URVVHU 0RGHOV RI PLFURELDO LQWHUDFWLRQV LQ WKH VRLO &5& &ULW 5HY 0LFURELRO %D]LQ 0DQG $ 0HQHOO 0DWKHPDWLFDO PHWKRGV LQ PLFURELDO HFRORJ\ S ,Q 5 *ULJRURYD DQG -5 1RUULV HGVf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f %LRWUHDWPHQW RI DJULFXOWXUDO ZDVWHZDWHU &5& 3UHVV %RFD 5DWRQ )/ %RKQ + %/ 0F1HDO DQG *$ 2n&RQQRU 6RLO FKHPLVWU\ 6HFRQG HGLWLRQ :LOH\,QWHUVFLHQFH 1HZ
PAGE 172

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f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

PAGE 173

'L*UD]LD 30 -0 +HQU\ .LQJ -: %ODFNEXUQ %$ $SSOHJDWH 35 %LHQNRZVNL %/ +LOWRQ DQG *6 6D\OHU '\QDPLF UHVSRQVH RI QDSKWKDOHQH ELRGHJUDGDWLRQ LQ D FRQWLQXRXV IORZ VOXUU\ UHDFWRU %LRGHJUDGDWLRQ (KUOLFK +/ DQG &/ %ULHUOH\ 0LFURELDO PLQHUDO UHFRYHU\ 0F*UDZ+LOO 1HZ
PAGE 174

*UHHQ 5( DQG 6: .DULFNKRII 6RUSWLRQ HVWLPDWHV IRU PRGHOLQJ S ,Q ++ &KHQJ HGf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f 2UJDQLF FKHPLFDOV ,Q WKH VRLO HQYLURQPHQW 0DUFHO 'HNNHU 1HZ
PAGE 175

,ULEHUUL 0 8QDQXH %DUFLQD DQG / (JHD 6HDVRQDO YDULDWLRQ LQ SRSXODWLRQ GHQVLW\ DQG KHWHURWURSKLF DFWLYLW\ RI DWWDFKHG DQG IUHH OLYLQJ EDFWHULD LQ FRDVWDO ZDWHUV $SSO (QYLURQ 0LFURELRO .DULFNKRII 6: 6RUSWLRQ NLQHWLFV RI K\GRUSKRELF SROOXWDQWV LQ QDWXUDO VHGLPHQWV S ,Q 5$ %DNHU HGf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

PAGE 176

/\QFK -0 7KH WHUUHVWLDO HQYLURQPHQW S ,Q -0 /\QFK DQG -( +REELH HGVf 0LFURRUJDQLVPV LQ DFWLRQ &RQFHSWV DQG DSSOLFDWLRQ LQ PLFURELDO HFRORJ\ %ODFNZHOO 6FLHQWLILF 3XE %RVWRQ 0$ 0DF4XDUULH .7% DQG ($ 6XGLFN\ 6LPXODWLRQ RI ELRGHJUDGDEOH RUJDQLF FRQWDPLQDQWV LQ JURXQGZDWHU 3OXPH EHKDYLRU LQ XQLIRUP DQG UDQGRP IORZ ILHOGV :DWHU 5HVRXU 5HV 0DGVHQ (/ (IIHFWV RI FKHPLFDO VSHFLDWLRQ RQ PLFURELDO PLQHUDOL]DWLRQ RI RUJDQLF FRPSRXQGV 3K' GLVV &RUQHOO 8QLY ,WKDFD 1< 'LVV $EVWU f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f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

PAGE 177

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n&RQQRU *$ 56 %RZPDQ 0$ (OUDVKLGL DQG 5 .HUHQ 6ROXWH UHWHQWLRQ DQG PRELOLW\ LQ 1HZ 0H[LFR VRLOV &KDUDFWHUL]DWLRQ RI VROXWH UHWHQWLRQ UHDFWLRQV $JULFXOWXUDO ([S 6WDWLRQ %XOOHWLQ /DV &UXFHV 1HZ 0H[LFR 2JUDP $9 5( -HVVXS DQG 36& 5DR (IIHFWV RI VRUSWLRQ RQ ELRORJLFDO GHJUDGDWLRQ UDWHV RI GLFKORURSKHQR[\DFHWLF DFLG LQ VRLOV $SSO (QYLURQ 0LFURELRO 2NXGD 6RUSWLRQ DQG WUDQVSRUW LQ KHWHURJHQHRXV SRURXV PHGLD $SSOLFDWLRQV RI IUDFWDO DQG VWRFKDVWLF DSSURDFKHV 3K' GLVV 8QLY RI )ORULGD *DLQHVYLOOH )/ 2n/RXJKOLQ (67UDQD DQG *. 6LPV (IIHFWV RI DGVRUSWLRQ RQ WKH ELRGHJUDGDWLRQ RI PHWK\OS\ULGLQH $JU $EVWU S 'HQYHU &2

PAGE 178

3HUULQ '' % 'HPSVH\ (3 6HUMHDQW S.D SUHGLFWLRQ IRU RUJDQLF DFLGV DQG EDVHV &KDSPDQ DQG +DOL 1HZ
PAGE 179

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
PAGE 180

6WHYHQVRQ )*HRFKHPLVWU\ RI VRLO KXPLF VXEVWDQFHV S ,Q *5 $LNHQ '0 0F.QLJKW 5/ :HUVKDZ DQG 3 0DF&DUWK\ HGVf +XPLF VXEVWDQFHV LQ VRLO VHGLPHQW DQG ZDWHU -RKQ :LOH\ t 6RQV 1HZ
PAGE 181

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f &KHPLVWU\ RI WKH VRLO QG HGf 5HLQKROG 3XEOLVKLQJ &R 1HZ
PAGE 182

:V]ROHN 3& DQG 0 $OH[DQGHU (IIHFW RI GHVRUSWLRQ UDWH RQ WKH ELRn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nV PRGHO &KHPRVSKHUH

PAGE 183

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

PAGE 184

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

PAGE 185

, FHUWLI\ WKDW KDYH UHDG WKLV VWXG\ DQG WKDW LQ P\ RSLQLRQ LW FRQIRUPV WR DFFHSWDEOH VWDQGDUGV RI VFKRODUO\ SUHVHQWDWLRQ DQG LV IXOO\ DGHTXDWH LQ VFRSH DQG TXDOLW\ DV D GLVVHUWDWLRQ IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ 5 'HDQ 5KXH $VVRFLDWH 3URIHVVRU RI 6RLO DQG :DWHU 6FLHQFH 7KLV GLVVHUWDWLRQ ZDV VXEPLWWHG WR WKH *UDGXDWH )DFXOW\ RI WKH &ROOHJH RI $JULFXOWXUH DQG WR WKH *UDGXDWH 6FKRRO DQG ZDV DFFHSWHG DV SDUWLDO IXOILOOPHQW RI WKH UHTXLUHPHQWV IRU WKH GHJUHH RI 'RFWRU RI 3KLORVRSK\ $XJXVW 'HDQ &RLWHJH RI $JULFXOWXUH 'HDQ *UDGXDWH 6FKRRO


80
Bacterial Strains and Culture Conditions
A strain of Pseudomonas sp. 3N3A capable of degrading quinoline and a
mutant strain (B53) derived from the 3N3A strain [obtained from Brockman et
al. (1989)]. Incorporation of two proteins for bacterial enumeration rendered the
organism incapable of degrading quinoline (McBride et al., 1992). The B53
isolate was used to determine the impact of biomass on sorption and transport
of quinoline where degradation was not a factor.
The B53 and 3N3A strains were grown for 17.5 hours on tryptic soy
broth (3 g/L) at 28 C on a rotary shaker (100 rpm). Bacterial cells were
harvested by centrifugation, washed two times and diluted to the desired
bacterial density with the appropriate background matrix solution (0.005 or 0.05
M CaCI2). Bacteria were allowed to equilibrate overnight in the desired matrix
prior to each experiment. Plate counts were done using tryptic soy agar (TSA)
and 4 day incubation periods at 28C. Plate counts were verified by visual
inspection of bacterial suspensions using a hemacytometer. A phase-contrast
microscope (Wild Neenbrugg) was used for counting the bacteria in the
hemacytometer.
Bacterial Inoculation
A 0.5 mL-aliquot of the appropriate bacterial suspension was placed in
an aspirator. The sterile soil (50 g) was thinly spread on aluminum foil and the
bacterial suspension was sprayed on the soil in a fine mist to uniformly
distribute the bacteria. The soil sample was mixed thoroughly to ensure


21
retardation; o = {[k2(1-/3)RL]/v} is the Damkohler number, which is
proportional to the ratio of hydrodynamic residence time (L/V) to the reaction
time (1/k2); L is the length of the column (L); F is the fraction of sorption in the
instantaneous regions; k2 is the first-order rate coefficient (1/T).
At the field scale, heterogeneous flow fields are often assumed to be
represented as being macroscopically homogeneous (MacQuarrie and Sudicky,
1990). The effects of local-scale pore-velocity variations are represented by a
"macrodispersion" term for the whole flow field. MacQuarrie and Sudicky (1990)
showed that such an approach can lead to a serious overestimation of
substrate degradation rate as a result of far greater mixing of the substrate and
dissolved oxygen plumes predicted to occur at the local scales when a macro
dispersion concept is employed. This is a clear demonstration of the
importance of appropriately understanding local-scale physical heterogeneity in
explaining and predicting macro-scale observations of biodegradation.
Similarly, heterogeneities in the flow fields may create mixing zones where high
concentrations of electron donors (i.e., organic acids produced by fermentation
processes active in oxygen limited regions) and acceptors (i.e., oxygen) create
high microbial populations and degradation capacities.
Research Objectives
Over the past two decades, studying each factor that influences the
environmental behavior of organic chemicals in isolation has resulted in the
accumulation of an extensive database on several key processes. As Rao et al.
(1993a) pointed out:


122
Clay
Microorganism
lojlpj
V
Not Drawn to Scale
Figure 4-9. Conceptualization of quinoline biodegradation in the
presence of smectite clay minerals.


BIOGRAPHICAL SKETCH
Cheryl Agnes Beilin was born in the rural community of Fairmont,
Minnesota, on December 11, 1963. She was the last of five children that Floyd
and Helen Beilin would bring into this world. She graduated from Fairmont High
School in 1982 after which she attended the Minneaplois/St. Paul campus of
the University of Minnesota and received her B.S. in agronomy with distinction
in 1987. She received her M.S. in soil science from New Mexico State
University in August of 1989. During the next four years she worked on her
Ph.D. specializing in environmental chemistry and developing a desire to
become enlightened about the complex interactions between microorganisms
and contaminants in soils. Her next endeavor will take her to Delaware where
she has accepted a research chemist position with DuPont in the Agricultural
Products Division Discovery Group.
170


128
Solutes
Solutes and specific methods of analysis used in these experiments are
listed in Chapter 2. Background matrix solutions (0.005, 0.05 M CaCI2) were
filter sterilized (0.2 jum) to minimize biodegradation of quinoline.
Column Studies
The Norborne soil for bacteria-inoculated columns were inoculated (108
cfu/g) and packed as described in Chapter 3. The effluent from a "sterile'1
Norborne soil column was collected for use as a nutrient media for the 3N3A
isolate biodegradation studies. Additional FeS04 (2 mg/L) was added to the
nutrient solution introduced into the soil column to enhance bacterial growth.
Dissolved oxygen (DO) contents were varied by changing the pore- water
velocity and monitored by a DO probe at the column outlet (see Chapter 3).
Biodegradation was monitored (quinoline and 2-HQ) during the initial quinoline
breakthrough and following the flow interruption.
CSFTR
The CSFTR (Figure 4-10) was designed to measure rapid kinetics of
quinoline degradation, and sorption in the absence of diffusional constraints.
The reactor consisted of a 4-mL stainless steel cylinder (Gelman Laboratories)
with a stainless steel shaft and a teflon propeller coupled to a 200 rpm motor
(Grainger). The shaft was supported by a stainless steel and a teflon spacer
which contained two Buna-N-orings (McMaster-Carr) to prevent leakage.


38
and analyzed by HPLC-UV techniques (Gilson 115 UV detector, Gilson Model
302 pump, Waters WISP 71 OB autosampler, HP333492A Integrator) to verify
sample purity and to compare the initial solute concentration to the maximum
effluent concentration. Quinoline and 2-HQ were eluted from a reversed-phase
column (Supelco LCPAH column) at a flow rate of 1 mL/min with a mobile
phase of 10/10/80 (v/v/v) methanol, acetonitrile and water adjusted to pH 2
with HCI. Soil column effluent pH was monitored on-line using an Ingold
microelectrode (Lee et al., 1991). Effluent fractions of the radiolabeled
compounds were collected with an automatic sample collector (ISCO Model
273). The activity of each radiolabeled compound was assayed using a liquid
scintillation counter (Searle Delta 300).
Data Analysis
Retardation factors (R) were calculated from area above the BTC for
quinoline and naphthalene (Nkedi-Kizza et al., 1987); a linear extrapolation
technique was used to extend the BTCs to C/C0=1 in order to estimate the
area above the BTC. For 4ECa pulses, the R was calculated by moment
analysis techniques (Brusseau et al., 1990). The curve fitting program CFITIM
(van Genuchten, 1981), which is based on nonlinear least-squares optimization
techniques, was used to estimate the Peclet number (P) from the BTC for
PFBA. For nonsorbed solutes (R = 1), two model parameters can be optimized:
P and the solute pulse size (J). Since the pulse size was determined
experimentally, only the value for P was estimated by fitting to the measured


91
approximately 1, indicating no sorption of these solutes by glassbead surfaces.
Thus, any retardation measured in the inoculated glassbead column is
attributed to biosorption by the attached bacteria. Biosorption was small for
45Ca (R = 1.15) and quinoline (R = 1.16) corresponding to a Kp 0.04 mL/g,
while naphthalene biosorption was slightly greater (R = 1.29; Kp 0.06 mL/g)
(Figure 3-4). These results suggest that biofacilitated transport of 45Ca,
naphthalene, and quinoline is not likely to be important in our studies, unless
high densities (> 108 cfu/mL) of bacterial biomass are sloughed off into the
column effluent.
Bacterial populations in the effluent of glassbead columns were 106 to
107 cfu/mL, which was higher than populations in the Norborne soil columns
(105 cfu/mL). The increased bacterial populations may have been due to a
larger pore size or a reduction in the sorption capacity of the glassbeads versus
the Norborne soil. Sorption of bacteria on glass surfaces and mechanisms of
attachment have been documented (Heukelekian and Heller, 1940; Zobell,
1943; Stotkzy, 1985; van Loosdrecht et al., 1990; Marshall, 1992). Therefore,
larger pore size within the glassbead column likely reduced physical constraints
and facilitated bacterial migration. Thus, biofacilitated transport may
predominate in porous sandy aquifer material. Enhanced bacterial migration
caused coatings to form on the UV detector cell which interfered with flow
through detection of the column effluent. This suggests that fraction collection
is essential to avoid analytical complications in porous media which are


127
Column experiments were conducted to determine the importance of oxygen
and nutrient contents on quinoline biodegradation. The CSFTR was designed
to measure rapid biodegradation kinetics, and to assess the impact of surfaces
on bacterial activity. The CSFTR has two advantages over miscible
displacement techniques: 1) the CSFTR is completely mixed and minimizes
physical nonequilibrium; and 2) the contaminant is rapidly monitored in the
effluent. For column studies, at least one pore volume must be displaced
before it is monitored in the effluent. If a contaminant is completely degraded
prior to reaching the column outlet, simply monitoring the column effluent is not
adequate. Unfortunately, soil columns were not sectioned to determine
quinoline profiles throughout the columns. Hindsight reveals the limitations of
only monitoring the quinoline behavior in the column effluent using column
techniques.
Material and Methods
Sorbents
The Norborne soil (Table 2-1) was used for the column experiments. An
isolated particle size fraction (0.5 45 jum) was used for the CSFTR studies.
This procedure increased the sorption capacity (35 cmol(-)/kg) and minimized
the potential for migration of soil particles through the outlet filter (0.2 nm). The
soil was stored in suspension (10:1, liquid:solid). Prior to each experiment, the
Norborne clay and silt suspension was equilibrated with 0.1 N CaCI2 at the
desired pH until the effluent pH remained constant.


98
Discussion
The specific sorption mechanism for a solute may influence the impact of
the microbial biomass on contaminant sorption and transport. For example, a
compound undergoing electrostatic interactions, such as cation exchange,
would exhibit reduced sorption if the specific exchange sites were inaccessible.
Similarly, HOC sorption may be reduced if the biomass is less hydrophobic and
reduces access to organic regions in which a nonpolar compound is sorbed.
On the other hand, sorption of HOCs may increase if hydrophobic biomass
remains on the soil surface and increases the overall hydrophobic nature of the
soil. If, however, hydrophobic biomass is transported in the solution phase
biofacilitated transport may occur. For ionogenic compounds, bacterial
biomass may cause interfacial variations in pH which would alter their sorptive
behavior.
The premise that bacterial biomass alters sorption of contaminants
requires further definition of the locations of contaminant sorption as well as the
bacterial colonies. This question is of great interest in remediation of
contaminated soils and bioavailability of contaminants. However, the answer is
not readily available. To facilitate the discussion, the following assumptions will
be made: 1) HOC sorption is assumed to occur within the organic fraction of
the soil; 2) sorption of cations occurs predominantly on cation exchange sites
located within clay interlayers and aggregates; 3) bacteria colonize soil surfaces
as microcolonies (Vandevivere and Baveye, 1992; Marshall, 1992); and 4)


CHAPTER 5
SUMMARY AND CONCLUSIONS
Summary
In this dissertation I investigated quinoline-soil-microorganism
interactions: the limitations and potential of bioremediation practices. Solute-
sorbent interactions in batch and flow-through systems were investigated to
determine rate-limited processes controlling bioavailability of nitrogen
heterocyclic compounds (NHCs). Microorganism-sorbent-solute interactions in
flow-through columns were investigated to determine the impact of
bioremediation practices on contaminant sorption and transport. Factors
limiting bacterial growth were investigated to determine important parameters
necessary for process coupling. Finally, a continuously stirred flow-through
reactor was designed to measure rapid biodegradation kinetics and the impact
of surfaces on bacterial activity. The following summary discusses the
significance, failures, and future opportunities of this research.
Solute-Sorbent Interactions
Batch and column studies were conducted to investigate the sorption
mechanisms of quinoline. A discussion of the questions proposed in the
introduction follows: What sorption processes limit bioavailability of NHCs in
148


101
this case, bacterial biomass added about 1% to the soil sorption capacity.
Therefore, the bacterial biomass may not have contributed substantially to the
organic carbon content. However, in low organic matter soils or sandy aquifer
materials, contaminant sorption may be increased upon bacterial additions.
Whereas, quinoline and 45Ca sorption was reduced by the addition of bacterial
biomass, naphthalene sorption may have been decreased by surface
inaccessibility and biofacilitated transport or slightly increased by the addition of
organic matter to the soil. The counteracting effects of these mechanisms likely
decreased the magnitude of enhanced naphthalene transport.
Surface Accessibility
Addition of bacterial biomass and production of extracellular bacterial
polymers (Kjelleberg et al., 1984; Bengtsson, 1991; Vandevivere and Baveye,
1992) may alter the ability of Norborne soil to sorb chemicals. This soil has a
low organic carbon content (0.16%) and electrostatic interactions are primarily
associated with the 2:1 clay interlayer positions. Bacterial biomass may have
altered sorption of quinoline in intra-aggregate and interlamellar regions.
Reduced accessibility of organic matter by bacterial biomass decreased
naphthalene sorption.
Summary
The impact of biomass on the sorption and transport of contaminants
was investigated. Sorption of NHCs was shown to be reduced as a result of


134
Column Biodegradation Studies
Adaptation. Adaptation of the 3N3A isolate to column conditions was
required to promote degradation of quinoline to 2-HQ despite the fact that this
isolate had been induced on quinoline and the soil column effluent (Figure 3-1).
Analysis of the effluent using HPLC techniques verified that quinoline was not
degraded in the column during the first 3.87 hours. The flow rate was 0.98
mL/min, and the adaptation time was greater than the residence time (~11
min). To induce degradation, a flow interruption was conducted for 13.63 hours
and the flow was restarted at 0.195 mL/min to enhance the interaction between
the 3N3A isolate and quinoline. After the flow interruption, 2-HQ was detected
in the column effluent. The bacteria in these soil columns were initially induced
on quinoline; however, after equilibration with the soil for 48 hours (during
saturation) the 3N3A isolate required an adaptation to quinoline. This suggests
that in soil and aquifer materials, biodegradation may be initially limited by the
time necessary for enzyme induction.
Truex et al. (1992) suggested that the time for bacterial induction on
quinoline (5 mg/L) decreased from 36 to 21 hours for cells starved for 2 versus
70 days. Their bacterial isolate was depleted of nutrients, carbon, and energy
sources in a saline solution for the allotted time and packed into a glassbead
column. In this study, the 3N3A cells were added directly from the nutrient
solution to the Norborne soil. At this time, CaCI2 solution was introduced to
saturate the soil column. The residual quinoline concentration introduced with


89
migrated and populated the entire column with the maximum population
reaching 1Q7 to 108 cfu/g. Maximum bacterial effluent concentrations ranged
from 1Q4 to 105 cfu/mL, confirming bacterial transport.
The bacterial population in the soil column was supported by nutrients
and organic carbon released from the soil matrix. Analysis of the column
effluent confirmed the presence of trace quantities of essential elements for
bacterial growth. Therefore, additional nutrients were not supplemented (for
further discussion see Chapter 4). Energy was likely derived from the dissolved
organic carbon in the soil solution. Assuming a maximum bacterial population
of 108 cfu/g, bacterial dry weights of 16 10'13 g/cfu (Gray et al., 1974), and
50% of the bacterial cell is organic carbon (Bratbak and Dundas, 1984), 8 10'5
g of organic carbon is required to maintain this population. The available
dissolved organic carbon (DOC) from soils has been estimated to be about 1%
of the total organic carbon (Reddy et al., 1982). Therefore, about 1.6 10'5 g
DOC per mL of soil solution providing may have been available, which can
provide adequate energy for bacterial cell production.
Water flow may alter bacterial movement and the dissolved oxygen (DO)
content, which in turn may influence the activity of microorganisms (Smith et al.,
1985; Trevors et al., 1990; Lindqvist and Bengtsson, 1991). Therefore, DO was
measured at different velocities. A vessel was purged with N2, effluent from the
column introduced, and DO measured with a dissolved oxygen electrode
(Yellow Springs Instruments 5750). In the Norborne soil columns, DO ranged


94
range, the electrophoretic mobility of the B53 isolate ranged -0.5 to -1.0 10'8
meter/V/sec. These values are in agreement with electrophoretic mobilities
measured over the same pH range (Krekeler et al., 1991) and electrophoretic
mobilities (-0.42 to -3.42 10'8 meter/V/sec) measured for 23 bacterial isolates
(van Loosdrecht et al., 1987). The lower negative charge of the B53 isolate
suggests that it has a greater potential than 3N3A to approach the soil surface
and attach.
The relative bacterial hydrophobicity of the bacterial isolates was
determined by partitioning the bacterial isolates between hexadecane and a
phosphate buffer solution following the procedure used by Rosenberg et al.
(1980). Bacterial cells which partition into the hexadecane phase from the
aqueous phase indicated that bacterial surfaces are hydrophobic. The
hydrophobicity (e.g., adsorption potential) was assessed by the bacterial
distribution coefficient between the hexadecane phase and the aqueous phase
(Dhw). At pH 7.5, the Dhw was 3 times larger for the B53 isolate (DHW = 0.39
ml_/mL) than the 3N3A isolate (DHW = 0.12 mL/mL). However, at pH 6.5 the
Dhw was 10 times larger for the B53 isolate (DHW = 0.11 mL/mL) than the
3N3A isolate (DHW = 0.01 mL/mL). The hydrophobicity of the B53 isolate is
greater than the 3N3A isolate in the pH range of the soil columns. Both
hydrophobic and electrostatic interactions favor sorption of the B53 isolate.
Given that bacteria may attach, grow, and colonize the surface, the potential
exists to alter the soil surface and more specifically the soil sorption capacity.


118
(Figure 4-8) was thought to directly degrade sorbed-phase naphthalene. They
concluded that naphthalene biodegradation by the NP-Alk isolate was solely
controlled by rate-limited desorption. Based on biodegradation rates that
appeared to exceed those estimated by assuming that degradation occurs only
in the solution-phase, they concluded that the 17484 isolate had the ability to
scavenge the sorbed-phase naphthalene which allowed this isolate to overcome
desorption constraints.
As predicted in Figure 4-5, invoking desorption-limited biodegradation is
adequate to describe the data trends (Figure 4-8) for naphthalene mineralization
by the 17484 isolate without assigning unique physiologic attributes to the
microorganisms. Desorption-limited biodegradation is characterized by slower
rates of approach to a given plateau value (i.e., constant amount degraded) as
the mass in the system is increased.
After reviewing their data, describing the behavior of naphthalene in the
presence of the NP-Alk isolate (Figure 4-7) becomes more challenging than the
typical desorption-limited degradation (Figure 4-8). Naphthalene sorption by
organic matter of these soils likely occurs via hydrophobic partitioning in interior
regions of the organic matter matrix. SEM photographs (Chapter 2) indicate
that the interior sorbent regions are inaccessible to microorganisms. Therefore
scavenging of naphthalene directly off the surface may not be possible due to
physical constraints separating the microorganism from the contaminant.
The kinetic data for naphthalene biodegradation by the NP-Alk isolate


69
Figure 2-13. Structural representation of organic matter (adapted
from Bhar and Vandenbroucke, 1987).


112
the solution and become bioavailable. Therefore, biodegradation may be
controlled by the rate of desorption, but the total amount degraded is not. This
fact persists regardless of whether equilibrium or nonequilibrium sorption
conditions prevail for sorption-desorption. If, however, the contaminant
solution-phase concentration drops below the threshold concentration to
sustain biodegradation, will biodegradation cease.
The bicontinuum model with first-order biodegradation was used to
evaluate desorption-limited behavior, assuming biodegradation occurred only in
the solution phase (Figure 4-5). Input parameters (kb, mass to volume ratios,
Kp) were obtained from experiments by Guerin and Boyd (1992). Rate
coefficients were calculated from the k2-Kp relationship (Brusseau et al., 1989).
An example of a case where desorption limits biodegradation of contaminants is
presented in Figure 4-5. The total amount degraded is constant at all mass to
volume ratios, however, biodegradation rates decreased upon increasing the
mass of soil in the suspension. Another example of sorption decreasing
biodegradation rates was presented by Chung et al. (1993), where the
importance of the location of the contaminant and the microorganisms were
incorporated into the model. Sorption occurred within interior regions of clay
aggregates and small-diameter pores excluded microorganisms from entering
the aggregate. Therefore, diffusion of contaminants out of the aggregates
limited biodegradation rates although the total amount degraded was constant.
If sorption is irreversible, as shown for diquat, the sorbed-phase


58
redistribution of the quinoline molecule and limited accessibility due steric to
hindrances.
The significance of the interlayer spacing in this smectite clay mineral
during quinoline sorption is apparent, given that the majority (up to 80%) of the
charge associated with the clay mineral originates in the interlayer spacing from
isomorphic substitution. The predominant form of clay in the Norborne soil is
biedellite which is characterized by substitution of Al+3 for Si+4 in the
tetrahedral layer. The clay fraction was isolated from the Norborne soil and
prepared for X-ray diffraction to measure changes in d-spacing upon
replacement of quinoline for 40Ca. Mounts were prepared by placing a known
amount of clay suspension onto a clay tile and saturating with 1 M CaCI2. The
sample was rinsed with deionized water to remove excess Ca. The tile was
equilibrated for about 48 hours at both 56 and 87 % relative humidity and the d-
spacing was measured. Sufficient quinoline was then added to the clay tile to
occupy 1% of the total sites. Measurements of the d-spacing were repeated at
56 and 87 % relative humidity. A decrease in the d-spacing upon addition of
quinoline would indicate the collapse of the clay interlayers and a potential
source of nonequilibrium sorption.
No obvious changes in d-spacing were indicated in the 1% quinoline
saturated samples compared to the Ca saturated samples at either relative
humidity. A decrease in the d-spacing was detected upon decreasing the
relative humidity. The d spacing was 1.6 nm at 87% relative humidity of which


137
O)
3
O
4 -
e
o
=S 3
c
0>
o
c
o
(J
-->
E
O
3
LU
2 -
1 -
O
O
O Quinoline
2-Hydroxyquinoline
O

O
25 50
Time (hours)
75
100
Figure 4-11. Quinoline biodegradation in a Norborne soil column
under micronutrient limiting conditions.


Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy
COUPLED PROCESSES: INTERACTIONS OF CONTAMINANTS,
BACTERIA, AND SURFACES
By
Cheryl A. Beilin
August 1993
Chairperson: P.S.C. Rao
Major Department: Soil and Water Science
Bioavailability and biodegradation of organic solutes in soils are
thought to be controlled by coupled sorption and transformation processes.
The principal hypothesis is that sorbed substrates are unavailable to
microorganisms. The fact that microorganisms may actively change the local
environment further complicates the issue by altering the magnitude and
kinetics of sorption and degradation. The importance of coupled sorption-
biodegradation processes is recognized in regard to the impact on
environmental contamination and bioremediation.
Bioremediation technologies have generally had limited success in
achieving adequate levels of cleanup, primarily because of constraints on
bioavailability of sorbed contaminants. Thus, understanding the interactions
X!


r 5 i
M Mmaxh? J
Ks + S
18
(1-3)
where m is the specific growth rate of the biomass (1/T), /xmax is the maximum
specific growth rate (1/T), S is the substrate concentration (M/L3) and Ks is the
substrate half saturation constant (M/L3). This equation is commonly used to
describe the bacterial growth upon contaminant degradation.
Often, organic contaminant degradation is limited by availability of an
electron acceptor or an additional carbon substrate. The modified Monod
equation couples the dependence of bacterial growth on another carbon
substrate or electron acceptor:
r 5 r O ,
^ Mmax [ d [
(1-4)
Ks + S' Ko+ O
where O is the oxygen concentration (M/L3) and KQ is the oxygen half
saturation constant (M/L3). Equations may also incorporate an inhibition
coefficient to account for growth rate limitations due to a toxic feedback
mechanism (Harvey and Widdowson, 1992). In order to adequately describe
contaminant behavior, all parameters necessary for these models must be
measured at the particular scale of interest.
Transport
The governing differential equation that serves as the basis for most
coupled-process models used in soils and aquifers is


C MINERALIZED
109
2 4 6 8 10
HOURS
Figure 4-3. Data (symbols) for aggregates with different radii and
DSB model simulations (solid lines) of mineralization of
50 ng 14C-labeled glutamate/mL in the presence of gel
exclusion beads. (From Scow and Alexander, 1992).


54
Considerable asymmetry of the quinoline BTC at pH 7 in the sterile
Norborne soil (0.05 and 0.005 M CaCI2) is indicative of nonequilibrium behavior
during displacement of quinoline for 40Ca (Figure 2-7). A large drop in effluent
concentration (35 to 50%) during the flow interruptions greater than 17 hours
indicates strong nonequilibrium behavior (Brusseau et al., 1989). Figure 2-9
shows the nonequilibrium behavior upon repeated flow interruptions in the 0.05
M CaCI2 Norborne soil column at pH 6.2. The first flow interruption (at 20
hours) results in a 50% drop in concentration. Subsequent flow interruptions
(24 hours) suggested that quinoline sorption is rate-limited into interlayer
positions of phyllosilicate minerals and possibly into interior regions of organic
matter matrices.
Symmetrical BTCs for PFBA and 3H20 preclude physical nonequilibrium
constraints (e.g., mobile-immobile water) as a possible reason, and 45Ca cation
exchange was rapid. Therefore, quinoline sorption nonequilibrium must be due
to other constraints.
OLoughlin et al. (1991) reported that sorption of a N-heterocyclic
compound (2-methyl pyridine) into 2:1 clay interlayers was rate-limited, whereas
sorption onto edge-sites of kaolinite was rapid which suggests that steric
hindrances are limiting sorption. However, similar molecular dimensions of
quinoline (1.02 nm X 0.76 nm x 0.36 nm; Weast, 1984) and hydrated Ca (0.6
nm; Bohn et al., 1979) suggest that size considerations alone are not likely to
account for the observed sorption nonequilibrium of quinoline. Szecsody and


126
readily available in the soil solution provided the soil is rich in organic matter or
phyllosilicate minerals which may release essential nutrients (Stotzky, 1966). If
nutrients are unavailable (precipitated or bound), bacteria may facilitate the
release and uptake of nutrients by excreting organic acids (Stucki et al., 1992).
However, oligotrophic environments (i.e., low nutrient and substrate
concentrations), typical of deep subsurface aquifers, cause bacteria to become
physiologically stressed and their metabolic activity reduced. Upon addition of
substrates, enzymes must be induced to promote substrate utilization. The
induction time (i.e., time required to produce 2-HQ) for the 3N3A isolate
growing on quinoline in laboratory glass bead columns varied with the duration
of starvation (i.e., physiological state of the organism) and the
substrate/contaminant concentration. Starved cells more completely degraded
quinoline, utilizing the substrate efficiently. In these studies, bacteria were
primarily attached onto glass beads while quinoline remained in solution.
Research Question and Tasks
Many studies have been conducted to examine the influence of sorption
on biodegradation. The following questions related to this issue are proposed
for this chapter: 1) What processes are important in coupling sorption,
biodegradation and transport of organic contaminants in soils, aquifers, and
sediments? and 2) Do surfaces influence bacterial activity? To address these
questions, miscible displacement techniques and a continuously stirred flow
through reactor (CSFTR) were utilized, and literature data were reassessed.


7
studied. NHCs can exist in their protonated or neutral form depending on the
pH in the system. Therefore, to estimate the fate of these compounds, an
adequate representation of the appropriate linkages between the controlling
processes is essential. For these compounds, variations in pH will have
ramifications on the microbial community and their activity as well as on the
sorption dynamics. The following section is a review of the key processes that
control the fate of organic compounds and discuss the factors important in
developing a coupled- process model.
Sorption
The distribution of HOCs between the solid and solution phases is
characterized by an equilibrium sorption partition coefficient (Karickhoff et al.,
1979; Chiou et al., 1983). Most often the Freundlich isotherm is used:
S=KfC1/n 0"1)
where S is the sorbed concentration (/xg/g), Kf = Freundlich sorption coefficient
[mL.(1/n) glHVnM/g], Q = equilibrium solution concentration (jug/mL), and 1/n
= Freundlich isotherm constant. Equilibrium sorption models are often used in
solute transport models. However, equilibrium assumptions are generally
inadequate in describing local-scale and field-scale sorption because
nonequilibrium conditions predominate.
Sorption nonequilibrium for HOCs can be described using the
bicontinuum model (Brusseau and Rao, 1989b). Conceptually, the model


9
bicontinuum model may not adequately describe the behavior of NHCs in soil
materials. This aspect will be explored further in a later section (see Chapter 2).
Biodegradation
Bioavailabilitv
Biodegradation is a dominant mechanism affecting organic chemical
transformations in soils and aquifers. Microbial degradation of most small
organic compounds (molecular mass < 600) occurs intra-cellularly (Bitton et al.,
1988). Thus, the rate of biodegradation is limited by the dynamics of 1)
physical-chemical processes (e.g., solubility, sorption, hydrodynamic dispersion)
that leads to a lowering of solute concentration in the solution phase; 2) soil or
environmental factors that limit physiological activity of the appropriate microbial
consortia; 3) microbial factors that limit substrate uptake by the microorganisms
(e.g., cell permeability and hydrophobicity); and 4) intra-cellular genetic or
biochemical factors (e.g., presence of appropriate enzyme systems, presence
and expression of genes) that limits utilization of the compound. The
recalcitrance of different organic chemicals in a specific soil, or the variations in
degradation rates of a specific compound in several soils, may be explained to
a large extent by understanding these key factors.
Inoculation of soils and aquifers with microorganisms capable of readily
degrading chemicals may result in a partial or complete lack of contaminant
removal due to various environmental stresses not present under laboratory
conditions. Contaminant persistence may result from the following factors


56
Streile (1992) attributed sorption nonequilibrium to kinetic constraints from site-
specific chemical processes between the quinoline and montmorillonite. Over
the concentration range used in this study, the protonated form is likely the
predominate species sorbed via cation exchange. In the bulk solution of the
soil columns, quinoline exists essentially in the neutral form. Zachara et al.
(1990) demonstrated that even when pH values are pH a (pKa +2) and most of
quinoline exists in its neutral form, the quinolinium ion is still the predominant
form sorbed. In addition, surfaces can be up to 2 units lower in pH than the
bulk solution pH (Bates, 1973) and protonation reactions are rapid. Therefore,
availability of quinolinium ions in solutions is not likely to limit sorption.
The bicontinuum model provided an inadequate description of quinoline
behavior in Norborne soil columns (Figure 2-8, 2-9). The frontal portion of the
curve adequately describes the rapid access to the easily accessible external
sites. Nonlinearity of the quinoline sorption also caused self sharpening of the
front of the BTC. The model fits were optimized for nonequilibrium parameters
6 and to (Table 2-3), and are shown in Figure 2-9. The quinoline displacement
in the column adjusted to pH 4.7 was conducted at 0.5 mL/min, whereas
displacement studies in the other three columns listed in the Table 2-3 were
conducted at 2 mL/min. The Norborne soil has 0.16% organic matter in
addition to smectite clay minerals. The large fraction (0.5) of sites
instantaneously accessed by quinoline was attributed to sorption on edge sites
(as much as 20%) and easily accessible interlamellar sites of smectite minerals


Effluent Concentration (mg/L) Effluent Concentration (mg/L)
Time (min)
Figure 4-13. Alteration of bacterial activity upon introduction of
Norborne clay and silt as measured by the change in
biodegradation of quinoline.


28
Therefore, the mechanisms influencing quinoline sorption must be accurately
determined to assess the conceptual validity and adequacy of the bicontinuum
model.
Quinoline Sorption Dynamics
Figure 2-2 describes the ionization of quinoline between the protonated
(QH+) and neutral species (Q) as a function of pH. Mathematically, the
ionization of quinoline is represented by
QH+ ** Q + H+
^ [Q][H+]
[QH+]
where Ka is the ionization constant.
Sorption of quinoline has been characterized in batch systems using soil
and clay materials (Ainsworth et al., 1987, Zachara et a!., 1988; 1990), and in
column studies using modified and pure clays (McBride et al., 1992; Szecsody
and Streile, 1992). Quinoline sorption was adequately described by the
Freundlich isotherm (see Chapter 1). These studies suggest that the
quinolinium ion (QH+) is the predominant species sorbed via cation exchange
at low concentrations. As surface coverage increases, quinoline likely
occupies lower energy sites and multiple layers of quinoline at the sorbent
surface may form. More importantly, sorption varies with pH reflecting quinoline
ionization (Fig. 2-2, eq 2-1) and preferential retention of the organic cation.
(2-1)
(2-2)


66
drop in the relative concentration and approached a relative concentration of
98%. The k2 values determined from model fits for the lower pH columns are
less than the higher pH columns (Table 2-3). Sorption is about 25 times faster
at higher pH values than in lower pH soils. The trend indicates reduced access
to interlayer positions as pH decreases.
Consideration must be given to differences in the nature of organic
matter versus clay minerals in describing the quinoline sorption. Diffusion of
quinoline into interlamellar regions was suggested to be rate-limited. However,
sorption of quinoline into organic matter matrices was not clearly defined in the
Norborne soil due to the presence of smectite clay minerals. Therefore, column
studies were conducted on a Eustis soil where a majority of the CEC is located
in the organic fraction of the soil and the remainder are associated with the
kaolinitic clay minerals.
A large drop in effluent concentration (35%) during the 17.8 hr flow
interruption in the Eustis soil column is indicative of nonequilibrium sorption into
organic matter matrices (Figure 2-12). It was suggested that sorption of the
neutral species behaved similarly to HOCs (IOMD), while sorption of the
quinolinium ion onto exterior regions of organic matter was rapid (cation
exchange) (Brusseau et al., 1991). However, flow interruption techniques
enhanced detection of sorption nonequilibrium and suggested that
nonequilibrium conditions predominated in organic matter matrices (Eustis soil)
and phyllosilicate minerals (Norborne soil). Access to rate-limited sites was


131
^ q(Q,-C) kbVC (4-1)
of
where M = VC + mS; V = volume of the CSFTR, m = the mass of soil, C =
concentration in solution, CQ = initial concentration of the Input solution, t =
time, kb = biodegradation rate coefficient, and q = flow rate.
The nondlmenslonalized equation Is written as
R (1-C*)-yC* (4*2)
dp
where
R 1+Kd, C*-, y
V d C0 r
kV
j
q
p
V
Biodegradation of quinoline to 2-HQ Is represented by
dC
dp
(1-Cq) -YQ^b
(4-3)
and biodegradation of 2-HQ to other metabolites given the quinoline input
concentration based on eq 4-3 is represented by
rhq
dCm
dp
-0+Yhq)chq + yqCq
(4-4)


149
remediation practices? Is the nonequilibrium sorption of NHCs accurately
described by the bicontinuum model?
Quinoline, a NHC, is sorbed predominately on cation exchange sites on
clay and organic matter. As a result, sorption is dependent on quinoline
speciation as influenced by pH. Quinoline sorption is limited by accessibility of
sites (i.e., steric hindrances) and by the desorption-limited behavior of the
quinoline complexes at the surface. The bicontinuum model did not
adequately describe quinoline sorption. Rapid ion exchange likely occurs onto
readily accessible cation exchange sites. However, reconfiguration of the
molecule to a planar position and diffusion within the sorbent matrix is not
adequately described.
Sorption of quinoline within phyllosilicate minerals and organic matter
may be impeded by initial sorption of quinoline molecules. Fixed spacing of the
clay mineral limits the expansion beyond 1.68 nm. Therefore, as quinoline
molecules sorb on the outer edges of a clay mineral access to internal sites
may be reduced. Furthermore, desorption constraints limit redistribution within
the interlamellar regions. Sorption within organic matter is likely limited by
specific electrostatic interactions which cause reconfiguration of the organic-
type polymers. Both sorbents restrict migration into interior regions causing
rate-limited sorption.
The bioavailability of quinoline sorbed within either mineral or organic
matrices is likely to be reduced. About 5 to 10 % of the quinoline introduced


53
electrolyte concentrations and ionic composition. Therefore, the pH was not
adequately controlled. Experimental techniques must be carried out with the
utmost detail when Investigating the behavior of ionizable compounds. A
controlled experiment with the system poised at a particular pH value has not
been conducted to accurately measure the influence of ionic strength on
quinoline sorption in soil columns.
Flow interruption. The accessibility of the cation exchange sites (i.e, clay
interlayer positions and organic matter) was evaluated by examining the
dynamics of 40Ca/45Ca isotopic exchange and exchange of quinoline for 40Ca.
The 45Ca BTC was symmetrical and showed about a 5% drop in concentration
after an 18-hour flow interruption in the 0.005 and 0.05 M CaCI2 columns
(Figure 2-7). This suggests that cation exchange and diffusion into clay
interlayer sites and organic matter regions was rapid, and that near equilibrium
conditions were attained under flow conditions for the column. Flow
interruptions suggested that migration of 45Ca into interlayer sites and organic
matter matrices was not limiting mass transfer or isotopic exchange kinetics.
Szecsody and Streile (1992) also found isotopic exchange of 40Ca/4oCa to be
rapid in columns packed with clay-modified alumina. Exchange of 40Ca/45Ca in
organic matter was rapid and not limited by mass transfer into the organic
matrix (Nkedi Kizza et al., 1989). They speculated that the compensation of
charge may occur at the exterior of the organic matter matrix and Ca does not
necessarily need to migrate within the sorbent.


119
appear to suggest that either sorption is practically irreversible (untenable given
the weight of evidence of published data) or that the sorbed-phase naphthalene
is in fact unavailable to this isolate, contrary to the conclusion reached by
Guerin and Boyd (1992). It is also possible that the total amount of
naphthalene degraded may be limited by low contaminant concentrations as a
consequence of slow desorption such that the necessary enzymes for
biodegradation are not sustained.
The foregoing arguments should not be taken, however, to imply that
organism-specific factors are unimportant. Even though considerable
physiologic diversity of bacteria and other microorganisms is to be expected,
direct surface scavenging of sorbed contaminants is yet to be unequivocally
demonstrated.
Microorganism-Sorbent Impacts on Biodegradation
The constraints of contaminant-sorbent interactions on biodegradation
has received much attention regarding bioremediation practices. However, the
interactions of bacteria with the sorbent and the implications on biodegradation
are not well understood. The influence of surfaces on bacteria was reviewed by
van Loosdrecht et al. (1990). They suggested that the impact of surfaces on
bacterial activity was not directly demonstrated but was confounded by
secondary effects. The soil/aquifer environment is highly complex. Surfaces
provide media for attachment and colonization of bacteria. During colonization
bacterial activity is likely altered. Bacteria attached to particles are generally


33
The ion exchange of quinoline and Ca +2 in a system initially saturated
with Ca+2was described in eq 2-5 and represented by Kv. Freundlich
isotherms are not considered to be ion exchange isotherms. However,
assuming sorption of the protonated species onto cation exchange sites and
the fraction of the CEC occupied by quinoline is small, the Ktf may be related to
the Kv by the following relationship:
Ku
N
QH+ a
NJ^l ~ >|
N
(2-8)
where N is the normality of the background electrolyte solution. However,
Zachara et al. (1988) predicted, based on eq 2-1, that the total sorbed quinoline
exceeded the fraction of quinoline existing as the quinolinum ion. Additional
sorption of quinoline could have been due to sorption of the neutral species,
clustering of the srbate, surface condensation, or protonation of quinoline at
the exchanger surface (Ainsworth et al., 1987; Zachara et al., 1988). However,
measurement of enhanced acidity, thus, protonation of quinolinium at soil
surfaces, is not a trivial task. Sorption of the neutral species and cooperative
adsorption have been reported (Ainsworth et al., 1987) to occur at high surface
coverages via entropic or van der Waals forces.
Sorption of quinoline onto soils (pH 4 to 7) was thought to occur via
cation exchange in the presence of cosolvent mixtures [volume fraction of
cosoivent (f^ < 0.4] (Zachara et al., 1988). Fu and Luthy (1986a) suggested
that cosolvents decreased quinoline sorption in response to an increase in


15
1986; Marshall, 1992). Recent microscopic evidence suggests that bacteria
exist in microcolonies with bacterial cells extending out into the soil pore spaces
(Vandevivere and Baveye, 1992). The difficulty in mathematically describing the
dimensions of the biofilms and microcolonies limits the utilization of these
models in soils and aquifers. The uniform microbial description, commonly
used in solute transport models, makes no assumptions about the distribution
of bacteria (e.g., discrete colonies or biofilms) in solution or on the surfaces
(Corapicoglu and Haridas, 1985; Kindred and Celia, 1989). This concept
suggests that overall growth and metabolism are not influenced by the microbial
distribution.
Biomass Impacts on Contaminant Sorption and Transport
Growth or addition of bacteria may drastically alter the chemical, physical
and microbiological environment of soil surfaces (Fletcher, 1991). Chemical
properties of soil surfaces may be altered by bacterial biomass thereby
influencing contaminant transport (Stucki et al. 1992; van Loosdrecht et al.,
1990; Stotzky, 1966). Physical alterations including blockage of pores by
bacterial biomass and blockage of sorptive regions in the soil may occur
altering water flow and sorption contaminants (Tan et al., 1992; Vandevivere
and Baveye, 1992). Bacterial transport (e.g., solution phase bacteria) and their
facilitation of contaminant migration was recently demonstrated (Lindqvist and
Enfield, 1992a). The impact of bacterial biomass is becoming recognized as an
important process influencing contaminant sorption and transport (Rao et al.,


169
Wszolek, P.C., and M. Alexander. 1979. Effect of desorption rate on the bio
degradation of n-alkylamines bound to clay. J. Agrie. Food Chem. 27:410-414.
Wu, S., and P.M. Gschwend. 1986. Sorption kinetics of hydrophobic organic
compounds to natural sediments and soil. Environ. Sci. Technol. 20:717-725.
Zachara, J.M., C.C. Ainsworth, C.E. Cowan, and B.L. Thomas. 1987. Sorption of
binary mixtures of aromatic nitrogen heterocyclic compounds on subsurface
materials. Environ. Sci. Technol. 21:397-402.
Zachara, J.M., C.C. Ainsworth, L.J. Felice, and C.T. Resch. 1986. Quinoline sorption to
subsurface materials: role of pH and retention of the organic cation. Environ.
Sci. Technol. 20:620-627.
Zachara, J.M., C.C. Ainsworth, R.L. Schmidt, and C.T. Resch. 1988. Influence of
cosolvents on quinoline sorption by subsurface materials and clays. J. Contam.
Hydrol. 2:343-364.
Zachara, J.M., C.C. Ainsworth, and S.C. Smith. 1990. The sorption of N-heterocyclic
compounds on reference and subsurface smectite clay isolates. J. Contam.
Hydrol. 6:281-305.
Zobell, Z.E. 1943. The effect of solid surfaces upon bacterial activity. J. Bacteriol.
46:39-56.
Zou, H., C. Fan, and O. Xu. 1992. Effects of sorption on biodegradation rates of 2,4-D:
Improvement of Rao's model. Chemosphere. 25:1923-1934.


Relative Concentration (C/CJ
67
0.8
0.6
0.4
0.2
no
O
cP
o
o
o
o
o
o
- o
o
o
o oo
o o
o
o
*§cP
15.5 h
Flow 23 h
Interruption
0.01 N CaCI,
o 30 % Methanol
10 20
Pore Volumes (p)
30
Figure 2-12. Breakthrough curves of quinoline in Eustis soil with
0.005 M CaCI2 and 30% methanol.


12
Brusseau and Rao, 1989b; Brusseau et a!., 1991), for biodegradation of HOCs
(Rijnaarts et al., 1990; Robinson et al., 1990), and for denitrification (Myrold and
Tiedje, 1985). For naphthalene, which exhibits reversible sorption/desorption
(Mihelcic and Luthy, 1988a,b), biodegradation was not dependent upon
desorption kinetics from fine-sized material (Mihelcic, 1988). For larger
particles, biodegradation of naphthalene was dependent upon intra-particle
diffusion from the solid-phase to the solution-phase, which suggests mass
transfer constraints or reduced bioavailability of the sorbed naphthalene
(Mihelcic and Luthy, 1988c).
For quinoline, highly selective cation exchange reactions may control
mass transfer from the soil to solution, thereby limiting biodegradation. Smith et
al. (1992) suggested that biodegradation of quinoline in dispersed clay
suspensions is limited by desorption of the highly stable quinolinium ion surface
complex. However, it is not known if these same rate-limiting steps control
biodegradation rates in soils and sediments or if diffusion-limited mass transfer
constraints (IOMD, IPD) are operative. For this reason, mechanistic models
coupling the sorption, degradation, and transport in soil and aquifer systems
are needed to understand the rate-limiting steps of organic chemical
biodegradation.
Effects of Surfaces on Biodegradation
At the cellular-scale, the influences of surfaces on bacterial activity have
been monitored indirectly in a variety of disciplines. Reported observations


99
bacteria are assumed to adhere to soil surfaces in collocation with the energy
and nutrient sources (e.g., organic matter and clay). The presence of bacterial
biomass in soil may impact contaminant sorption directly by decreasing the
accessibility of sorptive regions or indirectly by changing the interfacial
properties of the soil.
Biofacilitated Transport
Biosorption of quinoline and 45Ca was not measurable; therefore,
biofacilitated transport did not likely reduce retardation of these compounds.
Naphthalene biosorption may have occurred in the column studies resulting in
biofacilitated transport in the inoculated columns. HOCs possessing a more
hydrophobic nature are more apt to undergo biosorption, and therefore,
biofacilitated transport. For example, DDT, a highly hydrophobic chemical, was
strongly sorbed in sterile sand columns (R = 59.8), but displacement of
bacterial solutions containing DDT through the sand columns demonstrated
biofacilitated transport in which R was reduced 8-fold (Lindqvist and Enfield,
1992a). Biofacilitated transport may be most important in contaminated sites,
where bacterial populations and chemical concentrations are high and for
chemicals exhibiting high biosorption potential. However, initial incubation of a
contaminant with the soil prior to bacterial addition may reduce the potential for
biofacilitated transport due to rate-limited contaminant desorption.


156
of the cell membrane by sorbent-bacterial associations decreased 2-HQ uptake.
More work is needed to support this experimentation on the influence of surfaces
on bacterial activity. Direct investigation of bacterial-sorbent associations by SEM
during sorption and biodegradation experiments would substantiate the current
findings.


COUPLED-PROCESSES: INTERACTIONS OF CONTAMINANTS,
BACTERIA, AND SURFACES
By
CHERYL A. BELLIN
A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY
UNIVERSITY OF FLORIDA
1993


68
suggested to be faster into the organic matter matrix than into the clay minerals
(Table 2-3). Organic matter is thought to be a flexible deformable organic
polymer; therefore, migration into this type of matrix may be less restricted than
into interlamellar regions of clay minerals.
Nonequilibrium due to IOMD arises due to restricted diffusion within the
polymer-like matrix of organic matter (Brusseau et a!., 1991). Specific
interactions of quinoline with functional groups of organic matter are likely to
change the nature of this flexible organic polymer. Redistribution of charge
upon migration of quinoline within the organic matter may cause the matrix to
collapse around the quinoline molecule and restrict diffusion. Brusseau et al.
(1991) suggested that Ca sorption occurred at the exterior or the organic matter
because of the long range interaction of electrostatic charge. Alternatively, Ca
migration into interior regions of organic matter may be rapid. The
nonequilibrium behavior of quinoline suggests that quinoline migration into the
interior regions of the organic matter is rate limited. Hydrophobic and cation
exchange interactions may occur with the quinoline molecule due to charge
separation on the molecule.
Figure 2-13 is a proposed schematic diagram of organic matter (Bhar
and Vandenbroucke, 1987). The structure is composed of regions of randomly
distributed hydrophobic and hydrophilic regions comprised of aromatic and
aliphatic structures, respectively. Envision quinoline migration into this organic
matrix: specific interactions between quinoline and hydroxyl groups may occur


72
a
b
Figure 2-14. Scanning electron micrograph of an organic soil at
6000x (a) and 1000x (b).


32
implication of this on quinoline transport in soils and aquifers will be examined in
a later section (Chapter 5).
A high Kvfor quinoline suggests that quinoline may be favored over
inorganic cations on the exchange complex. Other NHCs (e.g., acridine,
pyridine), were shown to reduce quinoline sorption in low pH soils (4.7) where
compounds are protonated and sorption occurs via cation exchange (Zachara
et al., 1987). However, competition in soils where the neutral species
predominates (pH 7) was not apparent.
Predictive models have not been developed which adequately describe
the sorption and transport of NHCs (Szecsody and Streile, 1992). Sorption of
NHCs has been shown to be dependent upon the pH and cation exchange
capacity of the sorbent matrix. Therefore, accounting for these factors with an
individual parameter would enable the use of a predictive model for soils that
vary in their cation exchange capacity and pH. If the predominant sorption
mechanism is cation exchange, normalization of quinoline sorption to QH + and
the CEC of the soil of may be described by
S, = Ktt C,1/n (27)
where S, is the sorbed concentration [mol QH +/molc(-)], K,f = Freundlich-type
sorption coefficient [(L(1/n)mol QH+[1'(1/n)])/molc(-)], C, = equilibrium solution
concentration [mol QH+/l_]. and 1/n = isotherm constant. This relationship
resembles a Freundlich-type isotherm where the describes the sorption of
NHCs accounting for variations in the cation exchange capacity and pH of the
soil.


132
The solution assuming transient behavior of quinoline is given by
-p(1+yq)
1 e Rq (4-5)
Q = Z
1+Yq
Assuming steady state of quinoline sorption and biodegradation the solution
simplifies to
1
(1+Yq)
(4-6)
The solution assuming steady state with respect to 2-HQ sorption and
biodegradation is given by
(1+Yq)(1+YHq)
Results and Discussion
Bacterial Preparation
The 3N3A isolate was grown and induced on quinoline and the soil
extract (Table 4-1) to represent the soil solution in a soil/aquifer environment.
Selection of media for the growth, cultivation, and maintenance of
microorganisms is often defined by the intended use and the origin of the
microorganism (Angle et al., 1991). The 3N3A isolate was isolated from 200
m below the soil surface in Aiken, SC. Deep aquifers are generally depleted in
nutrients, therefore, common nutrient-rich media are not representative of the


CHAPTER 4
QUINOLINE BIODEGRADATION IN FLOW-THROUGH SYSTEMS
Introduction
Solute-Sorbent Impacts on Biodegradation
Bioavailability and biodegradation are dependent upon solution-phase
concentrations of contaminants which are controlled by sorption-desorption
processes, and bacterial associations with the sorbent and contaminant. The
principal hypothesis concerning the impact of sorption of biodegradation is that
sorbed substrates are unavailable to bacteria. This hypothesis is contingent
upon the occurrence of intracellular degradation. The distribution of bacteria in
relation to the location of the contaminant may also influence the likelihood of
biodegradation. A majority of the bacteria exist in discrete microcolonies on
surfaces in soil and aquifer materials and some bacteria (10%) exist in the
solution-phase.
Bioavailability of sorbed contaminants has been the primary focus of
recent research efforts since the success of bioremediation practices is
predicated on contaminant release from the sorbed-phase. Several questions
need to be answered to understand the coupling of sorption and
biodegradation: 1) Is the process intra- or extracellular? 2) Is sorption reversible
or irreversible? 3) Where does the contaminant reside, within the sorbent matrix
103


22
Having made impressive advances in our understanding of the key
processes (transport, transformations, and sorption), it is now important
to examine the linkages between these processes. Coupled-processes
models provide the stimulus for a paradigm shift-from the reductionist
approaches to the relational approaches-where an investigation of the
inter-relations among the processes is considered even more important
than the examination of individual processes themselves. (8)
The primary objective of this dissertation research is to investigate soil-
solute-microorganism interactions and their importance in contaminant
persistence and transport in soil and aquifer materials. Reactions that are
important in coupling sorption, biodegradation, and transport of quinoline will be
investigated. From these results, the bioavailability of NHCs and thus, the
success of bioremediation practices will be assessed.
The following questions are proposed to address the following solute-
sorbent-microorganism interactions:
(1) Solute-sorbent. What sorption processes limit bioavailability of
NHCs in remediation practices? Is the nonequilibrium sorption of
NHCs accurately described by the bicontinuum model?
(2) Microorganism-sorbent-solute: Do bioremediation practices
influence NHC sorption and transport?
(3) Solute-microorganism: What essential nutrient and oxygen
contents are required for biodegradation?
(4) Microorganism-sorbent. Is bacterial activity (i.e., biodegradation)
altered in the presence of surfaces?


16
1993b). Therefore, the impact of bacterial biomass near hazardous waste sites
is of interest.
Environmental Factors Influencing Biodegradation
Environmental variables may be significant in surface soils where
microbial communities are in direct contact with the soil atmosphere. Seasonal
cycles in temperature and soil-water content distinguish this zone from aquifer
systems that may exhibit more constant conditions. Groundwater temperatures
are relatively constant; however, temperatures may be as low as 10 to 15C
which may reduce microbial activity. Surface fluctuations in temperate regions
may reduce bacterial activity throughout the winter months. In contrast,
bacterial activity will likely be high in warmer, tropical environments. Variations
in temperature over the usual range of interest (5-40C) are not likely to
influence the degradation pathway, only the rate of microbial degradation and
the microbial density. Changes in soil-water content, on the other hand, may
influence microbial communities and their activity.
Quantitative and qualitative differences result when observing aerobic and
anaerobic degradation. Deep, saturated aquifers may be depleted in oxygen
and bacterial populations may be limited by the availability of alternate electron
acceptors (N03, S04, C03). In oxygen depleted zones, fermentation results in
incomplete degradation of contaminants. Flow heterogeneities may create
zones of mixing thus supplying adequate nutrients and cofactors to stimulate a
diverse and numerous group of microorganisms. On the other hand, a


40
TEME (min)
Figure 4-8. Naphthalene mineralization time courses for strain
17484 in a soil-free control and Capac (a) and
Colwood soil suspensions (From Guerin and Boyd,
1992).


Fraction Mineralized
115
Figure 4-6. Simulation using the bicontinuum model with first order
biodegradation kinetics assuming irreversible sorption.


162
Iriberri, J., M. Unanue, I. Barcina, and L. Egea. 1987. Seasonal variation in population
density and heterotrophic activity of attached and free living bacteria in coastal
waters. Appl. Environ. Microbiol. 53:2308-2314.
Karickhoff, S.W. 1980. Sorption kinetics of hydorphobic pollutants in natural
sediments, p. 193-205. In R.A. Baker (ed.), Contaminants and sediments, Vol 2.
Ann Arbor Sci., Ann Arbor, Ml.
Karickhoff, S.W., D.S. Brown, and T.A. Scott. 1979. Sorption of hydrophobic pollutants
on natural sediments. Water Res. 13:241-248.
Kindred, J.S., and M.A. Celia. 1989. Contaminant transport and biodegradation. 2.
Conceptual model and test simulations. Water Resour. Res. 25:1149-1159.
Kjelleberg, S., and M. Hermansson. 1984. Starvation-induced effects on bacterial
surface characteristics. Appl. Environ. Microbiol. 48:497-503.
Krekeler, C., H. Ziehr, and J. Klein. 1991. Influence of physiochemical bacterial surface
properties on adsorption to inorganic porous supports. Appl. Microbiol.
Biotechnol. 35:484-490.
Lee, LS. 1993. Chemodynamic behavior of complex mixtures: Liquid-liquid partitioning
and sorption of organic contaminants from mixed solvents. Ph.D. diss. Univ. of
Florida, Gainesville, FL.
Lee, L.S., C.A. Beilin, R. Pinal, and P.S.C. Rao. 1992. Cosolvent effects on sorption of
organic acids by soils from mixed solvents. Environ. Sci. Technol. 27:165-171.
Lee, L.S., P.S.C. Rao, and M.L. Brusseau. 1991. Nonequilibrium sorption and transport
of neutral and ionized species. Environ. Sci. Technol. 25:722-729.
Lehman, R.G., J.R. Miller, D.D. Fontaine, D.A. Laskowski, J.H. Hunter, and R.C.
Cordes. 1992. Degradation of a sulfonamide herbicide as a function of soil
sorption. Weed. Res. 32:197-205.
Lindqvist, R., and G. Bengtsson. 1991. Dispersal dynamics of groundwater bacteria.
Microb. Ecol. 21:49-72.
Lindqvist, R., and C.G. Enfield. 1992a. Biosorption of dichlorodiphenyltrichloroethane
and hexachlorobenzene in groundwater and its implications for facilitated
transport. Appl. Environ. Microbiol. 58:2211-2218.
Lindqvist, R., and C.G. Enfield. 1992b. Cell density and non-equilibrium sorption effects
on bacterial dispersal in groundwater microcosms. Microb. Ecol. 24:25-41.


ACKNOWLEDGEMENTS
This dissertation was the collaborative effort of many people that either
directly or indirectly facilitated the completion of this document. Working on a
project entitled coupled processes is not easily accomplished in one laboratory
needless to say by one individual. During the last four years I received
assistance from many people, which I greatly appreciate. First, I would like to
thank Dr. Suresh Rao, for his insightful method of teaching and guidance. His
questions and discussions generated enthusiasm and challenged me to a
higher level of thinking. I would like to thank my committee members, Drs.
Bitton, Nkedi-Kizza, Hatfield, and Rhue for their helpful comments and
suggestions during my doctoral program. I especially thank Dr. Bitton for
facilitating the surface characterization of the bacterial isolates used in these
studies and Dr. Nkedi-Kizza for his critical review of the abiotic behavior of
quinoline.
I would like to thank my friends and colleagues in the lab, Drs. Linda
Lee, Denie Augustijn, Itaru Okuda, and Ms. Dongping Dai. Most of the time . .
the lab was a great place to interact and work. I would like to especially thank
Linda for her personal and professonal insight when it was asked for and even
when it was not. I thank Ron Jessup and Gerco Hoogeweg for their modeling


70
W
60
50
40
30
20
10
0
. 2HQ (mg/L)
o o
zs
**

A 5
* 10
Re

o
o
- o
k i
. !
. i
0 4
8
12
1
C (mg/L)
Figure 2-5. Sorption of quinoline on the Norborne soil in the
presence of 2-hydroxyquinoline.


129
?
A : stainless steel shaft
B : Buna-N 0-sings
C : marine type propeller
D : 2 titanium 0.2 pm filters
E : inlet
F : outlet
Figure 4-10. Schematic of CSFTR system used to monitor quinoline
biodegradation.


145
2-HQ concentration. Disrupted ceils and cell filtrates (enzymes only) were
incapable of degrading quinoline. Therefore, decreased activity is likely
associated with the bacterial membrane or surface. The results suggest that
uptake of 2-HQ into the bacterial cell was reduced. Coverage of the bacterial
cell by clay particles may have minimized 2-HQ-bacterial contact causing the
reduced uptake by the cell. Increased biodegradation of 2-HQ (2100 min,
Figure 4-13b) may be due to the variations in the clay-bacterial associations.
The clay particles may desorb from bacterial surfaces increasing the
degradation rates. Alteration of bacterial activity upon addition of surfaces in
the absence of contaminant sorption was shown to reduce the biodegradation
rate of intracellularly degraded quinoline metabolites.
Summary
The investigation of quinoline biodegradation suggested that
microorganisms are adaptable to a variety of environmental conditions including
pH, oxygen and nutrient contents, and flow conditions. Given adequate
nutrients, substrates, and oxygen it is reasonable to expect that favorable
conditions for microbial growth may be achieved in soil and aquifer
environments. Therefore, investigating the physiological behavior of bacteria
compatible with in situ conditions may increase the probability of successful
bioremediation practices. From these experiments it is believed that field
conditions may be manipulated to promote favorable conditions for
biodegradation.


36
Table 2-1. Soil properties before and after steam autoclaving.
Soil
pH in 0.005
M CaCI2
foe
CEC
cmol(-)/kg
location of
CEC
Eustis
5.3
0.0039
3.20
organic matter and kaolinitic
Sterile Eustis 5.4
0.0032
4.44
clay minerals
Norborne
6.4
0.0015
11.91
smectite clay minerals and
Sterile Norborne 6.4
0.0015
11.76
organic matter
Webster
6.9
0.037
47.9
organic matter and
smectite clay minerals
dispersion and extent of physical nonequilibrium conditions prevailing during
transport through the soil columns (Brusseau and Rao, 1989a). Quinoline
concentrations in the influent solutions for the column studies ranged from 4 to
10 mg/L. 14C-quinoline (Sigma) and spiked to obtain solutions at 10,000
cpm/mL. Batch studies were conducted for 2-Hydroxyquinoline (2-HQ) and
quinoline over the concentration range of interest at either 1 to 10 and 1 to 5
mass to volume ratios. Isotopic exchange of 4Cta and 4^Ca (6,000 cpm/mL)
was also investigated. Aqueous solutions of the chemicals were prepared in
filter-sterilized (0.2 pm) 0.005 or 0.05 M CaC^ Background matrix solutions
(0.005, 0.05 M CaCy were filter sterilized (0.2 im) to minimize biodegradation
of organic solutes.
Experimental Setup
Batch techniques (Nkedi-Kizza et al., 1985) were used to assess
sorption/desorption kinetics and equilibrium constants for quinoline in sterile
systems. A stirred batch reactor was used to measure quinoline sorption


24
compounds during steady, saturated water flow conditions through
homogeneously packed, sterile or bacterial-inoculated soil columns. Pre
inoculation of the Norborne soil with bacteria (108 cfu/g) simulates
contaminated subsurface soils and aquifers where bacterial populations may be
high. In this chapter I investigated the consequences of biostimulation practices
that attempt to remediate contaminated sites.
In Chapter 4, I explored the process coupling of sorption and
biodegradation of quinoline in flow through systems. First, growth limiting
factors were determined using miscible displacement techniques. This was
accomplished by monitoring breakthrough of quinoline and its primary
metabolite, 2-hydroxyquinoline, in bacterial-inoculated columns. Second, a
continually stirred, flow-through reactor was designed to monitor rapid
biodegradation kinetics and to assess the impact of surfaces on
biodegradation. These studies were used to determine processes important in
coupling sorption and biodegradation by investigating the impact of surfaces on
bacterial activity, and the conditions necessary for successfully remediating
contaminated sites.
Insights gained during my investigation of coupled processes and the
arduous task of dealing with living organisms are summarized in Chapter 5.
The significance, failures, and future opportunities of this research are also
presented in this chapter.


39
BTC for PFBA or For sorbed solutes (R>1), five model parameters can
be optimized: P,R, p, w, and J. For A5Ca and naphthalene BTCs, R was fixed
(estimated as described above), J was experimentally determined, P was fixed
as the value estimated from PFBA BTCs, and the values of nonequilibrium
sorption parameters (p and o) were estimated from parameter optimization
using the CFITIM program. For quinoline BTCs, the curve fitting program
FLOINT (Brusseau et al., 1989) with nonlinear sorption isotherms was used to
estimate the parameters when flow interruption techniques were used to
enhance the investigation of sorption nonequilibrium processes.
Results and Discussion
Sterilization Techniques
Initial batch studies were conducted to characterize the sorption of
quinoline and to assess techniques used for soil sterilization. Batch sorption
experiments were conducted using three nonsterilized air-dry soils and two soils
sterilized by steam autoclaving techniques. Autoclaving had minimal effect
(<2%) on the properties of the Norborne soil (Table 2-1). CEC measured by
4^Ca isotopic exchange (Babcock and Schulz, 1970) and the MgN03 extract
procedure (Rhue and Reve, 1990) resulted in similar values for nonsterilized and
autoclaved soils (See Table 2-1). Measurement of 4^Ca isotopic exchange over
time suggested that cation exchange on Norborne soil was completed within
the first 5 minutes. Isotopic exchange, thus, migration of 4^Ca into the interlayer
exchange sites, was virtually instantaneous. The CEC of the Eustis soil


158
Baughman, G.L., and D.F. Paris. 1981. Microbial bioconcentration of organic pollutants
from aquatic systems--a critical review. CRC Critical Rev. Microbiol. 8:205-228.
Baveye, P., and A. Valocchi. 1989. An evaluation of mathematical models of the
transport of biologically reacting solutes in saturated soils and aquifers. Wat.
Resour. Res. 25:1413-1421.
Bazin, M.J., P.T. Saunders, and J.l. Prosser. 1976. Models of microbial interactions in
the soil CRC Crit. Rev. Microbiol. 4:463-498.
Bazin, M.J., and A. Menell. 1990. Mathematical methods in microbial ecology, p. 128-
179. In R. Grigorova and J.R. Norris (eds.), Methods in microbiology. Academic
Press Limited. San Diego, CA.
Bhar, F., and M. Vandenbroucke. 1987. Chemical modeling of Kerogens. Org.
Geochem. 11:15-24.
Bengtsson, G. 1991. Bacterial exopolymer and PHB production in fluctuating ground-
water habitats. FEMS Microbiol. Ecol. 86:15-24.
Beveridge, T.J., and L.L. Graham. 1991. Surface layers of bacteria. Microbiol. Rev.
55:684-705.
Bitton, G., R.J. Dutton, and B. Koopman. 1988. Cell permeability to toxicants: an
important parameter in toxicity tests using bacteria. CRC Crit. Rev. Environ.
Control. 18:177-188.
Blackburn, J.W. 1989. Is there an "uncertainty principle" in microbial waste treatment?
p. 149-161. In M. Huntley (ed.), Biotreatment of agricultural wastewater. CRC
Press, Boca Raton, FL.
Bohn, H., B.L., McNeal, and G.A. O'Connor. 1979. Soil chemistry. Second edition.
Wiley-Interscience, New York.
Bratbak, G., and I. Dundas. 1984. Bacterial dry matter content and biomass
estimations. Appl. Environ. Microbiol. 48:755-757.
Brockman, F.J., B.A. Denovan, R.J. Hicks, and F.J. Fredrickson. 1989. Isolation and
characterization of quinoline-degrading bacteria from subsurface sediments.
Appl. Environ. Microbiol. 55:1029-1032.
Brockman, F.J., D.J. Workman, and J.K Fredrickson. 1990. Role of plasmids in a
Pseudomonas cepacia strain isolated from deep subsurface sediments. Abstr.
Annu. Meet. Northw. Branch, Am. Soc. Microbiol., Moscow, ID. Jun. 21.


79
soil is well documented (Chiou et al., 1983; Karickhoff et al., 1979). Pre
inoculation of the Norborne soil with bacteria (108 cfu/g) simulates
contaminated subsurface soils and aquifers where bacterial populations may be
high.
Materials and Methods
Sorbents
The Norborne soil was used for these studies (Table 2-1). Glassbeads
(average diameter 150 jum; Alltech Associates) and inert quartz sand (< 2 mm)
were used as inert solid support material. All sorbents were sterilized using
steam autoclaving as referenced in Chapter 2.
Sorbates
Pentafluorobenzoic acid (PFBA; 150 mg/mL) was used as conservative,
nonsorbing tracer to assess the hydrodynamic dispersion and extent of physical
nonequilibrium conditions prevailing during transport through the soil columns
(Brusseau et al., 1989). Quinoline and naphthalene concentrations in the
influent solutions for the column studies ranged from 4 to 10 ^g/mL. Isotopic
exchange of 40Ca and 45Ca (6,000 dpm/mL) was also investigated. Aqueous
solutions of the chemicals were prepared in filter-sterilized (0.2 jum) 0.005 or
0.05 M CaCI2. Sorbates were monitored by HPLC-UV for quinoline and
naphthalene, and by radio-assay techniques for 45Ca (See Chapter 2).


161
Green, R.E., and S.W. Karickhoff. 1990. Sorption estimates for modeling, p. 79-102. In
H.H. Cheng (ed.) Pesticides in the soil environment. SSSA Book Series 2.
SSSA, Madison, Wl.
Greer, L.E., and D.R. Shelton. 1992. Effect of inoculant strain and organic matter
content on kinetics of 2,3-dichlorophenoxy acetic acid degradation in soil. Appl.
Environ. Microbiol. 58:1459-1465.
Griffith, P.C. and M. Fletcher. 1991. Hydrolysis of protein and model dipeptide
substrates by attached and nonattached marine Pseudomonas sp. strain
NCIMB 2021. Appl. Environ. Microbiol. 57:2186-2191.
Guerin, W.F., and S.A. Boyd. 1992. Differential bioavailability of soil-sorbed
naphthalene to two bacterial species. Appl. Environ. Microbiol. 58:1142-1152.
Hamaker, J.W. 1972. Decomposition: quantitative aspects, p. 253-340. In C.A.I. Goring
and J.W. Hamaker (eds.), Organic chemicals In the soil environment. Marcel
Dekker, New York.
Harvey, R.W. 1991. Parameters Involved in modeling movement of bacteria In
groundwater, p. 89-114. In C.J. Hurst (ed.), Modeling the environmental fate of
microorganisms. American Society for Microbiology, Washington, DC.
Harvey, R.W., L.H. George, R.L. Smith, and D.R. LeBlanc. 1989. Transport of
microspheres and indigenous bacteria through a sandy aquifer: results of
natural- and forced-gradient tracer experiments. Environ. Sci. Technol. 23:51-
56.
Harvey, R.W., and M.A. Widdowson, 1992. Microbial distributions, activities, and
movement in the terrestial subsurface: experimental and theoretical studies, p.
185-225. In R.J. Wagenet, P. Baveye, and B.A. Stewart (eds.), Interacting
processes in soil science. Advances in Soil Sci., Boca Raton, FL.
Helmy, A.K., S.G. de Bussetti, E.A. Ferreira. 1983. Adsorption of quinoline from
surface solutions by some clays and oxides. Clays Clay Miner. 31:29-36.
Herzig, J.P., D.M. Leclerc, and P. LeGoff. 1970. Flow suspensions through porous
media-Application to deep Infiltration. Ind. Engin. Chem. 62:8-35.
Heukelekian, H., and A. Heller. 1940. Relation between food concentration and surface
for bacterial growth. J. Bacterio!. 40:547-558.
Huang, S., and M. Chou. 1990. Kinetic model for microbial uptake of insoluble
solid-state substrate. Biotechnol. and Bioeng. 35:547-558.


8
describes partitioning of compounds into the soil organic phase or adsorption
of compounds onto surfaces. Nonequilibrium sorption is represented by a two-
step process in which sorption in the first domain is instantaneous, while mass
transfer constraints limit sorption in the second domain. Thin organic coatings
distributed throughout the soil may result in minimal constraints for sorption
mass transfer, whereas sorption into large organic particles may increase solute
diffusion due to limited accessibility of sorptive regions. Factors that limit the
rate of HOC sorption that have been proposed include intraparticle diffusion
(IPD) (Wu and Gschwend, 1986; Ball and Roberts, 1991) and intraorganic
matter diffusion (IOMD) (Brusseau et al., 1991). Regardless of the actual
mechanism responsible for rate-limited sorption, contaminants are likely to
reside within the interior regions of the sorbent matrix. The consequences of
this occurrence on biodegradation will be discussed in the next section.
Sorption of NHCs has been described by the Freundlich isotherm
(Zachara et al., 1986, Ainsworth et al., 1987). Linearity of the sorption
isotherms varied, approaching a linear isotherm at low concentrations and
surface coverages (Ainsworth et al., 1987). The protonated species is the
predominant form of NHCs sorbed and is expected to sorb primarily onto cation
exchange sites. These sites may be associated with phyllosilicate minerals or
organic matter. In either case, sorption is likely to be rate limited due to
migration into clay interlayers and aggregates or organic matter matrices.
Given the complexity of exchange reactions involving organic cations, the


Relative Concentration (C/C0)
Figure 4-4. Measured and simulated BTCs for 2,4,5-T developed
with the two region model for the two cases of no
degradation (m=0) and degradation (¡jl>0). (From
Gamerdinger et al., 1990).


159
Brusseau, M.L., R.E. Jessup, and P.S.C. Rao. 1990. Sorption kinetics of organic
chemicals: evaluation of gas purge and miscible discplacement techniques.
Environ. Sci. Technol. 24:727-735.
Brusseau, M.L., R.E. Jessup, and P.S.C. Rao. 1991. Nonequilibrium sorption of
organic chemicals: Elucidation of rate-limiting processes. Environ. Sci. Technol.
25:134-142.
Brusseau, M.L., and P.S.C. Rao. 1989a. The influence of sorbate-organic matter
interactions on sorption nonequilibrium. Chemosphere. 18:1691-1706.
Brusseau, M.L., and P.S.C. Rao. 1989b. Sorption nonideality during organic
contaminant transport in porous media. CRC Crit. Rev. Environ. Control. 19:33-
99.
Brusseau, M.L, P.S.C Rao, and C.A. Beilin. 1992. Modeling coupled processes in
porous media: sorption, transformation, and transport of organic solutes, p.
147-184. In R.J. Wagenet, P. Baveye, and B.A. Stewart (eds.), Interacting
processes in soil science. Advances in Soil Sci., Lewis Publishers, Boca Raton,
FL.
Brusseau, M.L., P.S.C. Rao, R.E. Jessup, and J.M. Davidson. 1989. Flow interruption:
a method for investigating sorption nonequilibrium. J. Contam. Hydrol. 4:223-
240.
Chiou, C.T., L.S. Peters, and D.W. Schmedding. 1983. Partition equilibria of nonionic
organic compounds between soil organic matter and water. Environ. Sci.
Technol. 17:227-230.
Chung, G.-Y., B.J. McCoy, and K.M. Scow. 1993. Criteria to assess when
biodegradation is kinetically limited by intraparticle diffusion and sorption.
Biotechnol. Bioeng. 41:625-632.
Corapcioglu, M.Y., and A. Haridas. 1985. Microbial transport in soils and
groundwater: A numerical model. Adv. Water Resour. 8:188-200.
Crist, R.H., K. Oberholser, and B. Wong. 1992. Amine-algae interactions: cation
exchange and possible hydrogen bonding. Environ. Sci. Technol. 26:1523-1526.
Daniels, S.L. 1972. The adsorption of microorganisms onto surfaces: A review. Dev.
Indust. Microbiol. 13:211-253.
Dashman, T., and G. Stotzky. 1986. Microbial utilization of amino acids and a peptide
bound on homoionic montmorillonite and kaolinite. Soil Biol. Biochem. 18:5-14.


17
contaminated area can turn an oxygenated aquifer into an anoxic region, if the
heterotrophic respiration exceeds oxygen input or recharge. In well-drained
soils and shallow aquifers, microbial populations are predominantly aerobic,
utilizing gaseous or dissolved oxygen as an electron acceptor which would
degrade organic contaminants to metabolites and ultimately mineralized to C02,
H20, and other elements. Even in a well-drained soil, however, anaerobic
regions (e.g., microsites) may develop as oxygen is depleted potentially altering
the end products of metabolism.
Biodegradation Models
Specific growth rates of microbial populations have been represented by
a variety of mathematical models (Pirt, 1975; Alexander and Scow, 1989; Bazin
and Menell, 1990). The empirical power rate model:
- -*bC" 0-2)
at
where kb is the biodegradation rate constant (1/T), simplifies to a first-order
kinetics model when n = 1 (Hamaker, 1972). Concern over the use of this
model is expressed as it is often presented with no theoretical justification for its
use (Bazin et al., 1976).
The description of the microbial growth rate when it is restricted by the
concentration of a growth-limiting substrate is given by the Monod equation
which was developed from enzyme kinetics:


among sorption, biodegradation, and transport processes is needed to
elucidate rate-limiting mechanisms of contaminant biodegradation.
Quinoline, an ionizable organic base, is a contaminant of interest found in
energy-derived waste materials and products. Batch reactors were used to
measure quinoline equilibrium sorption coefficients in the absence of physical
constraints. Miscible displacement studies were conducted to simultaneously
measure quinoline sorption and biodegradation. The quinolinium cation was the
predominant species sorbed via cation exchange. However, the bicontinuum
sorption nonequilibrium model was inadequate in describing the measured
breakthrough curves for quinoline displacement through "sterilized" soil
columns. Quinoline-surface complexes limit the desorption and redistribution
within the sorbent matrix and thus, are likely to be unavailable for degradation.
Addition of bacteria (quinoline-nondegrader) reduced quinoline sorption
and retardation in soil columns, which were attributed to biomass-induced
changes in quinoline speciation and blockage of surface sites. In columns
inoculated with a quinoline-degrader, quinoline was rapidly degraded and
biodegradation kinetics could not be measured. The continuously stirred flow
through reactor was used as an alternate technique to monitor rapid
biodegradation kinetics (kb < 0.5 seconds'1) and to measure the response to
imposed perturbations. Introduction of sorbent particles at steady state (i.e.,
biodegradation of quinoline to 2-hydroxyquinoline and other metabolites)
resulted in two responses: 1) addition of soil particles required readaptation of
the bacterial isolate and caused reduced degradation rates; and 2) soil particles
XII


I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a dissertation for the degree of Doctor of Philosophy.
P.uSuresh C. Rao, Chair
Graduate Research Professor of Soil and
Water Science
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a dissertation for the degree of Doctor of Philosophy.
Professor of Environmental Engineering
Sciences
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a dissertation for the degree of Doctor of Philosophy.
Associate Professor of Civil Engineering
I certify that I have read this study and that in my opinion it conforms to
acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a dissertation for the degree of Doctor of Philosophy.
Peter Nkedi-Kizza
Associate Professor of Soil and Water
Science


147
After reviewing the literature and attempting to conduct experiments that
require the knowledge of a chemist, microbiologist, and a physicist, the search
for truth must take precedence over the motivation for publications. Two
thoughts come to mind in regard to these studies. First, experimental
techniques are crucial in investigating the impact of sorption on biodegradation.
One must design appropriate experiments that investigate the process of
interest and also have the scientific expertise to interpret experimental
observations. Experimentalists must step back and appropriately interpret
experimental observations without bias as to the expected outcome. As stated
by Leonardo DaVinci in 1510:
Experience does not err, it is only your judgement that errs in promising
itself results which are not caused by your experiments.
Second, articulation of the results must be accomplished with the utmost
precision. When writing, it is important to choose your words carefully.
Scientists investigating a particular topic are responsible for understanding and
correctly utilizing the terminology of the discipline. This is particularly important
in an interdisciplinary subject such as coupled processes.


TABLE OF CONTENTS
ACKNOWLEDGEMENTS ¡
LIST OF TABLES vii
LIST OF FIGURES viii
ABSTRACT xi
CHAPTERS
1 INTRODUCTION 1
Overview of the Problem 1
Sorption 7
Biodegradation 9
Transport 18
Research Objectives 21
2 CHEMODYNAMICS OF N-HETEROCYCLIC COMPOUNDS IN
ABIOTIC SYSTEMS: BATCH AND FLOW-THROUGH
TECHNIQUES 25
Introduction 25
Quinoline Sorption Dynamics 28
Research Question and Tasks 35
Materials and Methods 35
Results and Discussion 39
Summary 73
3 ALTERATION OF SURFACES BY BACTERIAL BIOMASS .... 75
ft.
Introduction 75
Research Question and Tasks 78
Materials and Methods 79
Results 83
v


48
Table 2-2. Column parameters for sterile soil columns.
Column ID
CaCi2
mol/L
pH
P
g/cm3
0
mL/cm3
P
Norborne soil columns:
BQ5
0.005
7.0
1.48
0.44
80
A
0.005
7.0
1.49
0.45
137
B
0.05
6.2
1.54
0.42
108
BQ3
0.005
6.8
1.48
0.44
190
BQ8
0.005
6.2
1.47
0.49
nd*
BQ10
0.005
3.0
1.45
0.45
nd
Floint
0.05
6.2
1.42
0.44
120
pH5.1
0.005
5.1
1.47
0.44
97
pH4.7
0.05
4.7
1.51
0.47
nd
Eustis soil columns:
BQ2
0.005
5.3
1.79
0.32
110
DCMA
0.005
5.3
1.75
0.33
84
* nd = not determined
compared in a soil where sorption occurred primarily in organic matter (70%)
and kaolinitic minerals, and in a soil where sorption occurred primarily on
smectite type minerals and organic matter.
Figure 2-7 shows the BTC for 45Ca in 0.005 and 0.05 M CaCI2. The
retardation factor for 45Ca in the 0.005 M CaCI2 soil column is 37.6, whereas
the R in 0.05 M CaCI2 is 5.0. The sorption coefficient (Kd) of 45Ca is related
directly to the CEC of the soil, and inversely to the normality (N) of the
background electrolyte solution (Kd CEC/N) (Wilklander, 1964). Therefore, a
factor-of-ten increase in N should result in a 10-fold decrease in Kd. This was
indeed the case for sorption coefficients for 45Ca in the sterile 0.005 M CaCI2


CHAPTER 3
ALTERATION OF SURFACES BY BACTERIAL BIOMASS
Introduction
Bioremediation practices attempt to increase microbial activity or populations
in order to degrade organic contaminants present in soils or aquifers. Indigenous
microbial activity and/or populations may be increased by providing nutrients
essential for bacterial growth, or axenic bacterial cultures known to degrade
specific compounds may be injected directly into contaminated sites. Growth or
addition of bacteria may drastically alter the chemical and physical characteristics
of solid surfaces (Fletcher, 1991). Therefore, the impact of bacterial biomass on
contaminant behavior in porous media near hazardous waste sites is of interest.
In addition to contaminant biodegradation, addition of bacteria to porous
media may result in: 1) bacterial growth or transport through the porous media
leading to pore clogging as a result of physical straining: 2) biosorption and
bacterial migration facilitating contaminant transport; and 3) bacterial sorption onto
soil surfaces altering the sorption capacity. Although bacterial migration through
sandy soils and aquifers is well documented, bioremediation attempts have failed,
among other reasons, due to the inability of injected bacteria to reach
contaminated sites (Gibson and Sayler, 1992). Physical, chemical, and microbial
factors controlling bacterial transport in porous media have recently been
75


154
Conclusions
Bioavailability
Column studies show that the bicontinuum model does not adequately
describe the behavior of quinoline in abiotic systems. Formation of strong
quinoline surface complexes suggest that these complexes and quinoline sorbed
within the interior of the sorbent matrix may be unavailable for biodegradation.
Sorption reduces biodegradation if the contaminant is sequestered within the
sorbent matrix. Similarly, surface complexation of quinoline reduces bacterial
availability.
Approaches to Bioremediation
Contaminated sites may be prepared for bioremediation by enhancing the
microbial consortia in the environment through fertilizer application and aeration or
by addition of microorganisms known to degrade the contaminant of interest.
While other processes for contaminant removal require transport from the site to
incinerators etc., bioremediation may be done in situ. The limitations of these
practices, however, need to be recognized to avoid delay in selecting the
technique to remediate a site.
Limitations that may require alternate technologies exist at sites containing
high concentrations of contaminants and solvents that are toxic to microorganisms
or sites that have been considerably aged. In aged sites, the contaminant likely
resides within the interior of the sorbent and may be unavailable.


6
adequately describe degradation in mixed culture laboratory systems (Scow et
al., 1986; Simkins et al., 1986). Therefore, these models are not likely to predict
field-scale observations. Blackburn (1989) claims that laboratory-scale
predictions of field-scale observations are destined to fail because of the
complexity of the spatial scales of interest (for further discussion see Rao et al.,
1993a). Blackburn (1989) suggested that the Heisenberg Uncertainty Principle
applies to microbial dynamics which states that by simply making an
experimental observation (since most experimental techniques are invasive,
though in some cases noninvasive techniques may be used), the system is
perturbed and is no longer an adequate representation of the original system.
Despite these arguments, complex degradation models have been developed
that incorporate availability of electron acceptors and electron donors, nutrients,
and the oxygen status in aquifers (Widdowson et al., 1987; 1988; MacQuarrie
and Sudicky, 1990). Because of the inability to describe the parameters at the
field scale, many of these models are not validated.
Existing coupled process models are highly limited by a lack of
experimental observations (laboratory and field scales) that quantitatively
demonstrate the effects of process coupling, specifically the manifestation of
such coupling on contaminant migration/degradation rates and profiles.
Laboratory studies coupling sorption, degradation, and transport are limited to
HOCs; most are conducted in batch reactors. The simultaneous sorption,
transformation, and transport of NHCs in dynamic soil systems has not been


reduced 2-hydroxyquinoline uptake and degradation, while quinoline
biodegradation was not altered. In this case, bacterial activity may have been
reduced upon bacteria-sorbent association.
XIII


31
w if fCa+2 (2-6)
''v ''ex 5
f QH+
where the activity coefficients in the solid phase (f) of the exchanging ions
convert activity to mole fraction.
Quinoline and other NHCs form complexes with negatively charged solid
surfaces such as clay layer silicates (Zachara et al., 1986; 1987; 1988).
Selectivity coefficients (KJ were developed for comparing the affinity of one
cation versus another to occupy a cation exchange site. The exchange of
quinoline and Ca+2does not solely consider cation exchange because of the
strong quinoline-surface complexes. In this example, Kv includes the exchange
of quinoline and Ca+2 and the stability of the quinoline complexes on the
exchange phase. In eq 2-5, Kv > 1 indicates selectivity for QH + in the solid
phase whereas Kv < 1 indicates Ca+2is preferred. The high quinolinium
exchange selectivity coefficient on Na-montmorillonite (Kv = 200 to 1300) and
clay isolated from the Norborne soil (Kv = 104to 106) suggests that strong
quinoline-surface complexes are formed (Ainsworth et al., 1987; Zachara et al.,
1990). In these soils and pure clay minerals, Kv varied with pH and with
surface coverage which was suggested to be due to sorption of the neutral
species, occupation of high energy sites at low surface coverages, and surface
condensation. Reconfiguration of the quinoline molecule to a planar position
within interlayers of clay minerals may contribute to the hysteretic behavior
(Zachara et al., 1986; 1990) implying constraints to quinoline desorption. The


52
Measuring the influence of background electrolyte concentration on
quinoline was confounded by a simultaneous change in electrolyte
concentration and pH (Figure 2-7). Poising the soil pH at some value other
than the natural pH is often difficult. Repeated flushing of the soil column with
0.005 M CaCI2 resulted in a pH 6.9. The final pH after flushing the soil
column with 0.05 M CaCI2 ranged from 6.2 to 6.4, decreasing the pH about 0.6
pH units. As the pH of the soil approaches the pKa of the compound of
interest, sorption is increasingly sensitive to slight pH changes (Figure 2-2).
Therefore, sorption measurements of ionizable compounds must be conducted
at a constant pH.
The use of nutrient solutions was shown to alter the sorption of quinoline
(McBride et al., 1992). As a result, use of buffers was avoided. To alter the soil
pH, HCI may be added to the system. The addition of other ions may change
the overall ionic strength and the cation exchange complex, thereby influencing
quinoline sorption and possibly the phyllosilicate mineral structure. A titration
device was used to maintain a constant pH of soil-suspensions while quinoline
sorption was measured (Zachara et al., 1990). However, this procedure does
not lend itself to use in flow-through column techniques. In these column
experiments at the lower pH values, the background electrolyte solution was
adjusted with HCI and flushed until the pH was essentially constant ( 0.3 pH
units). Soil columns were flushed at 0.5 mL/min for about 2 weeks. Additional
acid was not added to adjust the pH of the quinoline solution due to changes in


35
Research Question and Tasks
The primary objective of these studies are to investigate the process-level
kinetics of quinoline sorption by soils addressing the question: what are the
rate-limiting processes controlling bioremediation practices of NHCs?
Equilibrium and mass transfer coefficients for sorption and desorption were
measured as a function of pH, molarity (M) and sorbent. The bicontinuum
nonlinear sorption model coupled with the advective-dispersive solute transport
model was used to assess quinoline sorption and transport during one
dimensional, steady water flow.
Materials and Methods
Sorbent
The soils used in this study and their properties are presented in Table 2-
1. Soils were sterilized for 30 min by steam autoclaving 50 g samples that were
brought to 15% water content and incubated for 24 hours. The process was
repeated two additional times and the soil was used in all subsequent
experiments unless otherwise noted. The soils used in the batch and column
experiments were initially saturated with Ca+2. Cation exchange measurements
were measured at the pH of the soil (See Table 2-1).
Solutes
Pentafluorobenzoic acid (PFBA; 150 mg/L) and ^p (6000 cpm/mL)
were used as conservative, nonsorbing tracers to assess the hydrodynamic


150
into the soil was not recovered after extensive rinsing. This fraction was
rendered unavailable to microorganisms based on the location of the solute and
the microorganism.
Microoraanism-Sorbent-Solute Interactions
Laboratory experiments were designed to examine the sorption and
transport of contaminants in bacterial inoculated column and batch systems.
The objective was to assess the potential for bacteria to alter the sorption and
transport of contaminants. Biofacilitated transport in near field regions of
contaminated sites was of interest. The question posed was: Do
bioremediation practices influence NHC sorption and transport?
Lindqvist and Enfield (1992) have shown that the transport of highly
sorptive hydrophobic organic chemicals (HOCs) (e.g, DDT and HCB) was
facilitated by biosorption and subsequent bacterial transport. My dissertation
showed that sorption of quinoline was reduced by interfacial biomass-induced
speciation changes at the soil surface. Sorption may be directly decreased by
reducing the accessibility of the sorptive regions. However, Ca sorption was
not affected by the presence of bacterial biomass, suggesting that blockage of
cation exchange sites was minimal. Sorption of a HOC, naphthalene, was
slightly reduced due to a combination of processes including blockage of
organic matter regions by hydrophilic bacteria and biofacilitated transport.
Biofacilitated transport is likely to be greatest for hydrophobic compounds (log
Kow > 6) in regions where high bacterial populations (108 cfu/mL) exist in the
solution phase (Lindqvist and Enfield, 1992).


110
total fraction mineralized approaches a constant value in all cases, even though
the observed rate of mineralization decreases with increasing sorbent mass.
A model describing the sorption, biodegradation, and transport of
contaminants in aggregated soils, based on rate-limited mass transfer and first-
order biodegradation kinetics, was presented by Gamerdinger et al. (1990).
They assumed that biodegradation occurred in both solution and sorbed
phases. Gamerdinger et al. (1990) modeled the data reported by van
Genuchten et al. (1989) from the column experiment with 2,4,5-trichlorophenoxy
acetic acid herbicide in an aggregated soil. The optimized simulation that
included degradation fit the data better than did the simulation that excluded
degradation (Figure 4-4). The bicontinuum model with first-order degradation
kinetics adequately described nonequilibrium sorption and biodegradation of 2-
chloro-s-triazine herbicides in soil columns (Gamerdinger et al., 1991).
There have been many investigations on the impact of contaminant
sorption on biodegradation (Guerin and Boyd, 1992; Greer and Shelton, 1992).
Often a comparison is made of contaminant biodegradation in pure cultures
versus soil-bacterial suspensions at different mass to volume ratios.
Understanding the sorption mechanisms and location is crucial to correctly
interpreting experimental results. To illustrate this point, the influence of
reversible and irreversible sorption on biodegradation will be discussed.
Sorption of HOCs is considered to be a reversible process (Chiou et al.,
1983). Therefore, at some point in time the contaminant will be released in to


C/C
27
Figure 2-1. Calcium () and quinoline (o) BTCs: a) pH 6, v = 0.162 cm/s and b)
pH = 6.9, v = 0.063 cm/s. Lines correspond to equilibrium (solid)
and first-order models (dash), (from Szecsody and Streile, 1992).


78
in sand columns. Biosorption technology has been commercialized to mobilize
metals in the mining industry (Ehrlich and Brierley, 1990). However, biofacilitated
transport of NHCs bases has yet to be demonstrated.
Research Question and Tasks
At the field scale, the question of interest is: what are the consequences
of bioenhancement or bioaugmentation practices in attempts to remediate
contaminated sites? Specifically, do bacteria alter the sorption and transport of
NHCs? In this chapter I examine the impact of bacterial biomass on the
sorption and transport of three solutes (naphthalene, 45Ca, and quinoline) in a
subsurface soil. These compounds were selected because of their known
specific interactions in soil: 1) naphthalene was selected to probe hydrophobic
interactions with the nonpolar organic phase; 2) 45Ca was selected to probe
electrostatic interactions with the cation exchange sites; and 3) quinoline, a N-
heterocyclic organic base, was selected because it can exist as a neutral
organic compound interacting with the organic phase or as a quinolinium ion
interacting with cation exchange sites. Miscible displacement techniques were
used to measure sorption and transport of the above compounds during
steady, saturated water flow conditions through homogeneously-packed, sterile
or bacterial-inoculated, soil columns. A fine-textured silt loam soil (Norborne;
fine-loamy, mixed, mesic Typic Argiudoll) was chosen for these experiments
because of the extensive characterization of quinoline sorption by this soil
(Zachara et al., 1988; 1990). Sorption of naphthalene by the organic fraction of


efforts. I also thank Christianne Smethurst and Ann Benner for their assistance
in the laboratory. I give special thanks to Candace Biggerstaff who added
levity, friendship, and help in finishing this dissertation.
Several people in the Soil and Water Science Department have
contributed to the work presented in this dissertation. In particular, I would like
to thank Dr. Sylvia Coleman for her guidance and use of her laboratory for
microbial preparations, Chris Pedersen and Dr. Amiel Jarstfer for the use of
their laboratory and their insight on microbiology ecology, Dr. Willie Harris for an
introduction to clay mineralogy and x-ray diffraction, and Kevin Cubinski and Dr.
Ann Wilke for their help in designing the continuously stirred flow-through
reactor
I would like to acknowledge the financial support provided by the State of
Florida via a Soil and Water Science research assistantship and additional
funding provided through Battelle Pacific Northwest Laboratories (PNL) from the
Department of Energy.
I thank Dr. John Zachara and Dr. Cal Ainsworth for their insights on
quinoline sorption, Dr. Jim Fredrickson and Dr. Fred Brockman for the bacterial
isolates used in this study and the other Battelle PNL staff for my enhancing my
summer fellowship experience.
I thank my mother and father for their continued support and pride in the
work I was doing. I also want to thank Dave Cantlin for his friendship, support,
and patience that were essential throughout my stay at UF and in Florida.
IV


2-10. Conceptual diagram of quinoline sorption onto smectite clay
minerals 60
2-11. Isotopic exchange of 12C-quinoline and 14C-quinoline in 0.05 M
CaCI2 (pH 6.2) in the Norborne soil 63
2-12. Breakthrough curves of quinoline in Eustis soil with 0.005 M CaCI2
and 30% methanol 67
2-13. Structural representation of organic matter (adapted from Bhar
and Vandenbroucke, 1987) 69
2-14. Scanning electron micrograph of an organic soil at 6000 x and
1000 x 72
3-1. Measured BTCs for PFBA (11) in a sterile column and for Quinoline
in a sterile (), 3N3A inoculated (*), and B53 inoculated () soil
column. Column designations are given in parenthesis
corresponding to Table 3-1 84
3-2. Measured BTCs for 45Ca in sterile () and B53 inoculated (o and
*) soil columns. Column designations are given in parenthesis
corresponding to Table 3-1 85
3-3. Measured BTCs for Naphthalene in a sterile () and a B53
inoculated (o) soil column. Column designations are given in
parenthesis corresponding to Table 3-1 86
3-4. Measured BTCs for PFBA (*), 45Ca (), Quinoline p), and
Naphthalene (o) in a B53 inoculated soil column 92
r
4-1. Schematic of sorption and biodegradation in soil aggregates (C
and C = the solute concentration in the pore water inside the
aggregate and the bulk solution, respectively) (adapted from
Mihelcic and Luthy, 1988c) 106
4-2. The impact of varying the sorption partition coefficient on
biodegradation (L/kg) in the presence of aggregates with radii of
0.05 cm. (From Scow and Hutson, 1992) 108
4-3. Data (symbols) for aggregates with different radii and DSB model
simulations (solid lines) of mineralization of 50 ng 14C-labeled
glutamate/mL in the presence of gel exclusion beads. (From Scow
and Alexander, 1992) 109
ix


REFERENCES
Aamand, J., C. Jorgensen, E. Arvin, and B.K. Jensen. 1989. Microbial adaptation to
degradation of hydrocarbons in polluted and unpolluted groundwater. J.
Contain. Hydrol. 4:299-312.
Ainsworth, C.C., J.M. Zachara, and R.L. Schmidt. 1987. Quinoline sorption on
Na-montmorillonite: contributions of the protonated and neutral species. Clays
Clay Min. 35:121-128.
Alexander, M., and K.M. Scow. 1989. Kinetics of biodegradation in soil, p.243-269. In
B.L. Sawhney and K. Brown (eds.), Reactions and movement of organic
chemicals in soils. Soil Science Society of America Special Symposium
Publication 22, Madison, Wl.
Angle, J.S., S.P. McGrath, and R.L. Chaney. 1991. New culture medium contained
ionic concentration of nutrients similar to concentrations found in the soil
solution. Appl. Environ. Microbiol. 57:3674-3676.
Augustijn, D. 1993. Chemodynamics of complex waste mixtures: Applications to
contamination and remediation of soils. Ph.D. diss. Univ. of Florida, Gainesville,
FL.
Babcock, K.L., and R.K. Schulz. 1970. Isotopic and conventional determination of
exchangeable sodium percentage of soil in relation to plant growth. Soil Sci.
109:19-22.
Bales, R.C., S.R. Hinkle, T.W. Kroeger, and K. Stocking. 1991. Bacteriophage
adsorption during transport through porous media: chemical perturbations and
reversibility. Environ. Sci. Technol. 25:2088-2095.
Ball, W.P. and P.V. Roberts. 1991. Long-term sorption of halogenated organic
chemicals by aquifer material. Part 2. Intraparticle diffusion. Environ. Sci.
Technol. 25:1237-1249.
Bates, R.G. 1973. Determination of pH; Theory and practice. Wiley, New York.
157


10
(Madsen, 1985; Goldstein et al., 1985): 1) low substrate concentrations not
supporting microbial growth; 2) microorganisms encountering toxins or
predators; 3) microorganisms using more readily available carbon sources; and
4) introduced microorganisms not reaching the contaminated site.
Enhanced on-site or In-sltu biodegradation provides a method for
removing organic contaminants in soils and aquifers. Utilizing indigenous
microorganisms is preferable to "Inoculation" or injection because they are
already adapted to the local environment. However, In the subsurface
environment, the complex Interaction between microorganisms, substrates, and
surfaces may alter this process. Biodegradation rates may be limited by
chemical properties of substrates, Interactions of the substrate with surfaces, or
simply by the lack of necessary enzymes (Madsen, 1985). Availability of slightly
soluble substrates may be controlled by the rate of dissolution (Stuckl and
Alexander, 1987; Miller and Bartha, 1989; Huang and Chou, 1990), or by low
aqueous concentrations which may not induce the necessary enzymes for
biodegradation (Madsen, 1985). Similarly, sorption of the substrate by soil may
reduce substrate concentrations In solution below levels necessary for enzyme
Induction.
Sorption of substrates might also enhance biodegradation rates by
decreasing the substrate concentration to levels that are not toxic to
microorganisms responsible for degradation (van Loosdrecht et al., 1990).
Sorption more likely reduces or inhibits biodegradation rates In soils (Stotzky


CHAPTER 2
CHEMODYNAMICS OF N-HETEROCYCLIC COMPOUNDS IN ABIOTIC
SYSTEMS: BATCH AND FLOW-THROUGH TECHNIQUES
Introduction
Sorption of NHCs may occur via cation exchange of the protonated
species on clay minerals or in organic matter and/or via partitioning of the
neutral species into organic matter. In contrast, sorption of HOCs occurs
primarily via partitioning" into the organic phase. The dynamics of HOC
sorption have been conceptualized and described by the bicontinuum sorption
model (Karickhoff, 1980; Brusseau et al. 1991, Ball and Roberts, 1991).
However, the adequacy of this model to describe the behavior of NHCs is
uncertain.
Nonequilibrium sorption has been separated into transport- and sorption-
related processes. Transport-related nonequilibrium affects both sorptive and
nonsorptive compounds and results from heterogeneities in the flow paths.
When using non-aggregated media in packed-column laboratory studies,
transport-related nonequilibrium is generally determined to be negligible.
Sorption-related nonequilibrium results from specific solute-sorbent interactions
or diffusive mass transfer constraints. Organic matter is considered to be a
flexible polymer-like substance (Bhar and Vandenbroucke, 1987) in which
25


11
and Rem, 1966; Madsen, 1985; van Loosdrecht et al., 1990). For example,
sorption was found to decrease the amount of substrate available to
microorganisms capable of degrading several compounds, including diquat
(Weber and Coble, 1968), benzylamine (Subba-Rao and Alexander, 1982; Miller
and Alexander, 1991), alkylamines (Wszolek and Alexander, 1979), glucose
(Gordon and Millero, 1985), 2,4-Dichlorophenoxyacetic acid (Ogram et al.,
1985), amino acids (Dashman and Stotzky, 1986), toluene (Robinson et al.,
1990), benzidine (Weber, 1991), quinoline (Smith et al., 1992), and flumetsulam
(Lehman et al., 1992). Degradation was adequately described by a second-
order rate equation with the assumption that only solution-phase chlorproham
and dibutyl phthalate are biodegraded in the presence of sediments (Steen et
al., 1980).
Biodegradation of contaminants may be limited when contaminants are
sequestered within the organic or inorganic components of the sorbent matrix
that are not directly accessible to microorganisms. Biodegradation may also
be limited by mass transfer (IPD and IOMD) from the interior of the sorbent to
the exterior solution. Bioavailability is limited in these examples because intra
aggregate pores are too small to be accessible to bacteria (Steinberg et al.,
1987, Scow and Alexander, 1992). The substrate sorbed within organic matter
is accessible only after desorption or diffusion out of the sorbent matrix. Mass
transfer constraints have been shown for sorption/desorption of hydrophobic
organic compounds (HOCs) in soils and sediments (Wu and Gschwend, 1986;


152
facilitated induction by increasing the contact time between the bacteria and the
contaminant.
The impact of factors that may limit quinoline biodegradation, including
oxygen, pore water velocity and pH, were not quantitatively determined in
column experiments because of rapid quinoline biodegradation kinetics.
However, oxygen contents decreased with a decrease in pore water velocity.
The distribution of oxygen is not likely to be uniform throughout the soil column.
Therefore, quinoline biodegradation was not directly determined. The 3N3A
isolate was capable of degrading quinoline prior to reaching the column outlet
at oxygen contents as low as 0.5 mg/L. Flow interruption appeared to be
required to induce quinoline biodegradation when pore water velocities were
high (90 cm/hr). The soil columns at pH 6.8 and 5 indicated no difference in
biodegradation (e.g, degradation occurred prior to reaching the column outlet).
Microorganism-Sorbent Interactions
A CSFTR was designed to evaluate rapid quinoline biodegradation
kinetics and to evaluate the influence of surfaces on bacterial activity. The
question of interest for the CSFTR experiments are: What are the
biodegradation rates for quinoline and 2-HQ in the CSFTR? Is bacterial activity
(i.e., biodegradation) altered in the presence of surfaces?
A CSFTR was designed to achieve steady state growth of quinoline
degrading microorganisms. Steady state was achieved in about 1000 minutes,
however, due to mechanical problems the CSFTR was maintained for a


136
Biodegradation in culture suspensions ceased when the headspace of a vessel
was purged with nitrogen to displace oxygen, verifying that biodegradation
occurs under aerobic conditions as anticipated. From these studies, it is
apparent that oxygen consumption is a function of the residence time within the
soil column. However, the influence of oxygen depletion on biodegradation
rates was not determined. A system in which oxygen content is uniform
throughout the soil-microorganism suspension is necessary.
A soil column that had been continuously flushed with quinoline solution
for about 3 months (several thousand pore volumes) and was monitored
periodically for quinoline, and 2-HQ no longer degraded quinoline.
Biodegradation within the soil column decreased whereby only 20% of the
quinoline introduced into the column was degraded to 2-HQ. After 500
additional pore volumes, quinoline biodegradation had ceased. The absence of
N in the Norborne soil did not limit quinoline biodegradation in the soil column,
being the 3N3A isolate utilized the N from the quinoline molecule. DO was 8
mg/L suggesting that microorganisms may be dormant or in a resting state
because oxygen was not being consumed. Sampling and plating the column
effluent verified bacteria were present at about 105 cfu/mL. Fe concentrations
in the soil column effluent solutions were low (Table 4-1). To check for limiting
nutrients, an FeS04 solution was introduced and quinoline degradation were
monitored (Figure 4-11). Stimulation of quinoline degradation and 2-HQ
production upon the introduction of Fe suggests that the 3N3A bacteria


23
The following chapters address the questions stated above by studying
quinoline sorption and degradation. Quinoline, a NHC, is a contaminant found
in energy-derived waste materials and products and has the potential to be
transported to the subsurface soil and groundwater (Zachara et al., 1986).
Quinoline sorption has been characterized in batch systems using clay minerals
and soils. Desorption was recently shown to limit biodegradation of quinoline to
its primary metabolite (2-hydroxyquinoline) in batch systems (Smith et al., 1992).
In Chapter 2, process-level sorption kinetics of quinoline are examined and the
utility of the bicontinuum model is evaluated. Understanding the behavior of
quinoline sorption in flow through systems is necessary to determine the
processes controlling bioavailability. Equilibrium and mass transfer coefficients
for sorption and desorption were measured using batch and miscible
displacement techniques. The bicontinuum sorption model coupled with the
advective-dispersive solute transport model (during one-dimensional steady,
water flow) was used to assess the behavior of NHCs. This information was
then used to determine the rate-limiting processes controlling bioremediation
practices of NHCs.
The impact of biomass on the sorption and transport of three solutes
(naphthalene, 45Ca, quinoline) in a subsurface soil are investigated in Chapter
3. These compounds were selected because of their known interactions in soil
(i.e., cation exchange or hydrophobic partitioning). Miscible displacement
techniques were used to measure sorption and transport of the above


73
The SEM photograph also shows fungal spores that have been preserved
within this organic soil. Further investigation of the organic matter surface
revealed fungal mats forming on the organic matter surface (Figure 2-14b). The
prolific growth of fungal spores and hyphal mass depicts the colonization of the
soil surface by microbial biomass and the possibility of altering contaminant
sorption and transport.
Summary
Quinoline is sorbed predominately on cation exchange sites on clay and
organic matter. Sorption is therefore dependent on quinoline speciation as
influenced by pH. Kinetics of ion exchange are rapid; therefore, quinoline
sorption is controlled by accessibility of sites, most likely through surface
complexation or inaccessibility due to steric hindrances. Quinoline sorption
potentially occurs via a three-step process -- an initial rapid phase sorbing onto
instantaneously accessible sites, followed by a reorientation of the molecule on
the surface, and subsequent redistribution within the organic matrix and
interlamellar regions of phyllosilicate minerals. Therefore, conceptually the
bicontinuum model is not adequate to describe quinoline sorption.
Quinoline sorption within phyllosilicate minerals and organic matter is
rate-limited. Sorption of quinoline on the outer edges of smectite clay minerals
may impede access of other quinoline molecules. A buildup of molecules at
clay interlayers may occur as desorption and migration into interlamellar regions
is limited. Therefore, access to the interlayer position may be blocked if


14
nutrient, and electron acceptor concentration and bacterial population) in
combination with factors discussed above.
Biomass Distribution
Microbial biomass is subject to sorption and transport processes.
Therefore, bacteria may exist in the soil either sorbed (attached) or in solution
(free). Physical, chemical, and microbial factors controlling the distribution of
bacteria in porous media have recently been summarized by Harvey (1991),
Lindqvist and Enfield (1992b), and Tan et al. (1992). Bacteria grow after they
attach to surfaces if essential carbon and energy sources are available. Growth
and development of bacterial colonies generally is followed by the production of
extracellular polysaccharides and promote the formation of bacterial biofilms
(van Loosdrecht et al., 1990; Fletcher, 1991). Under nutrient- and substrate-rich
conditions, as may be the case near waste disposal sites, biofilms may be
formed.
Mathematical models for biodegradation are developed assuming that
the microbial biomass may be distributed in biofilms, microcolonies, or uniformly
throughout the porous medium (Baveye and Valocchi, 1989). The assumption
of microbial biofilms suggests that surfaces are uniformly coated by biofilms in
which the degradation of the contaminant and the utilization of the electron
acceptor takes place (Rittman and McCarty, 1980). The microcolony approach
suggests that bacteria exist in discrete microcolonies and that growth and
substrate utilization rates correspond to the microbial population (Molz et. al.,


Relative Concentration (C/Cq)
1
0.8
0.6
0.4
0.2
0
0
-3
c@o
*
* o o
*
* c
o

* c*
*
Sterile (B)
o B53 (BQ11)
* B53 (BQ112)
-ft D '
10
Pore Volumes (p)
1
Figure 3-2. Measured BTCs for 45Ca in sterile (@) and B53
inoculated (o and *) soil columns. Column
designations are given in parenthesis corresponding to
Table 3-1.


TIME (min)
0 100 200 300
Figure 4-7, Naphthalene mineralization for strain NP-Alk in a soil
free (o), Colwood (a) and Oshtemo (b) soil slurries with
66.7 (), 133 (), or 200 (0) mg/mL (From Guerin and
Boyd, 1992).


50
column (1.0 mL/g) and 0.05 M CaCI2 column (11.0 mL/g). In contrast, ionic
concentration (molarity) of background matrix had minimal impact on quinoline
sorption at pH > 6.2 (Figure 2-7). The pH of the 0.005 M CaCL, column is 7
and the pH of the 0.05 M CaCI2 column is 6.2. The fraction of protonated
species is greater at pH 6.2 (5%) versus pH 7 (1%). The decrease in pH in the
lower background matrix concentration (0.005 M) column may compensate for
the decrease in sorption due to higher ionic concentration. Batch studies at pH
6.2 for 0.05 M CaCI2 and in pH 6.8 for 0.005 M CaCI2 suggest that sorption
(Kd) is greater (11%) as the molarity of the background matrix solution
decreases. Charge compensation in the diffuse double layer at higher
electrolyte concentrations may reduce the sorption of quinoline. In a subsoil
with a pH 7, the effects of ionic strength on quinoline sorption were negligible
(Zachara et al., 1986).
The influence of pH is evident upon comparing the BTCs in Figure 2-7
and 2-8 at the same background electrolyte concentrations. A decrease in pH
results in a increase in quinoline sorption. Increased sorption at lower pH
values is expected based on the increase in the fraction of QH + The influence
of background electrolyte concentration was not clearly determined. Previous
investigation suggested that sorption decreased 60% at pH values near its pKg
when the ionic strength increased from 0.001 to 0.1 M CaCI2 (Helmy et al.,
1983; Zachara et al., 1986).


76
summarized (Harvey, 1991, Lindqvist and Enfield 1992b, Tan et al., 1992).
Bacterial transport may be limited by physical constraints imposed by the porous
media, such as soil structure and pore size distribution (Lindqvist and Enfield,
1992b). Straining or filtration occurs in soils and aquifers when bacteria are too
large to pass through soil pores; this results in pore clogging, which restricts
further penetration of bacteria (Herzig et al., 1970; Harvey, 1991). Once bacteria
become clogged in the soil pores, water flow is also restricted, and the path of
water flow can be altered (Vandevivere and Baveye, 1992).
Chemical constraints, such as adsorption of bacteria, may also limit bacterial
migration through soils and aquifers (Harvey et al., 1989; Harvey, 1991, Bales et
al., 1991; Tan et al., 1992). Bacteria that are hydrophobic and are minimally
charged have the greatest potential to sorb onto surfaces; however, many other
factors may influence bacterial attachment (van Loosdrecht et al., 1987). Because
of bacterial adsorption by soils (Daniels, 1972) and clay minerals (Stotzky and
Rem, 1966), the contaminant sorption capacity of the soil may be altered. Bacteria
grow after they attach to surfaces if essential carbon and energy sources are
available. Growth and development of bacterial colonies generally coincide with
the production of extracellular polysaccharides and promote the formation of
bacterial biofilms (van Loosdrecht et al., 1990; Fletcher, 1991). Bacterial biomass,
therefore, contains live and dead cells and cell exudates (extracellular polymers).
Under nutrient- and substrate-rich conditions, as may be the case near wastes
sites, biofilm formation may create diffusional barriers leading to nonequilibrium


163
Lynch, J.M. 1988. The terrestial environment, p. 103-131. In J.M. Lynch and J.E.
Hobbie (eds.), Micro-organisms in action: Concepts and application in microbial
ecology. Blackwell Scientific Pub., Boston, MA.
MacQuarrie, K.T.B., and E.A. Sudicky. 1990. Simulation of biodegradable organic
contaminants in groundwater. 2. Plume behavior in uniform and random flow
fields. Water Resour. Res. 26:223-240.
Madsen., E.L. 1985. Effects of chemical speciation on microbial mineralization of
organic compounds. Ph.D. diss. Cornell Univ., Ithaca, NY (Diss Abstr. 85-
04534).
Marshall, K.C. 1976. Interfaces in microbial ecology. Harvard University Press,
Cambridge, MA.
Marshall, K.C. 1992. Biofilms: an overview of bacterial adhesion, activity, and control at
surfaces. ASM News. 58:202-207.
McBride, J.F., F.J. Brockman, J.E. Szecsody, and G.P. Streile. 1992. Kinetics of
quinoline degradation, sorption, and desorption in a clay-coated model soil
containing a quinoline-degrading bacterium. J. Contam. Hydrol. 9:133-154.
Mihelcic, J.R. 1988. Microbial degradation of polycyclic aromatic hydrocarbons under
denitrification conditions in soil-water suspensions. Ph.D. diss. Carnegie Mellon
Univ., Pittsburgh, PA (Diss Abstr. 88-17721).
Mihelcic, J.R., and R.G. Luthy. 1988a. Degradation of polycyclic aromatic hydrocarbon
compounds under various redox conditions in soil-water systems. Appl.
Environ. Microbiol. 54:1182-1187.
Mihelcic, J.R., and R.G. Luthy. 1988b. Microbial degradation of acenaphthalene and
naphthalene under denitrification conditions in soil-water systems. Appl.
Environ. Microbiol. 54:1188-1198.
Mihelcic, J.R., and R.G. Luthy. 1988c. The potential effects of sorption processes on
the microbial degradation of hydrophobic organic compounds in soil-water
suspensions, p. 1-14. In Physiochemical and biological detoxification of
hazardous wastes. Proc. Int. Conf. 3-5 May 1988. Hazardous Substance
Manage. Res. Ctr., Atlantic City, NJ.
Miller, M.E. and M.A. Alexander. 1991. Kinetics of bacterial degradation of benzylamine
in a montmorillonite suspension. Environ. Sci. Technol. 25:240-245.


Copyright 1993
by
Cheryl A. Beilin


47
dispersion (Table 2-2). Slight retardation (R 1.15) of BTCs for 3H20 on the
Norborne soil suggests that this tracer was sorbed. Sorption of 3H20 onto a
soil high in iron oxide content that contains predominately kaolinitic clay
minerals has been previously reported (Nkedi-Kizza et al., 1982). The Norborne
soil also contains iron oxides with 2:1 type clay minerals (Zachara et al., 1990);
thus, 3H20 sorption is likely. Sorption of 3H20 may indicate that water is
exchanged with hydrated sorbed ions on the clay surface (Szecsody and
Streile, 1992). Batch studies were conducted to measure 3H20 sorption onto
sterile Norborne soil. The sorption coefficient (Kd) was 0.03 ( 0.001) mL/g.
These Kd values are consistent with retardation factor (R) values ranging from
1.09 to 1.12 observed in different columns. The pore volumes determined by
3H20 after correcting for sorption resulted in similar pore volumes as
determined using gravimetric methods, and the BTC data for displacement.
3H20 was not sorbed onto the Eustis soil (R 1.0).
Chemical characterization. Monitoring 45Ca and quinoline sorption and
transport under specific chemical and physical conditions (e.g., molarity of
solution, pH, and pore-water velocity) will help understand mechanisms
influencing quinoline behavior. The data for 45Ca and quinoline were utilized to
explore the accessibility of cation exchange sites by an inorganic cation and an
organic cation. Nonequilibrium sorption was explored by observing isotopic
exchange of both 45Ca/40Ca and 14C-quinoline/12C-quinoline, as well as the
exchange of quinoline for calcium. The behavior of these two solutes were


70
followed by redistribution of charge and reconfiguration of the matrix around the
quinoline molecule. The hydrophobic portion of the molecule may associate
and partition into the aromatic region.
Addition of cosolvents increases solubility of organic compounds and
decreases sorption. In addition, the organic matter matrix may swell, increasing
accessibility to the interior of the organic matter matrix thereby reducing
sorption nonequilibrium (Nkedi-Kizza et al., 1989; Lee et al., 1991). However,
the fraction of instantaneous sites (F) decreased as the matrix swelled because
the surface area to volume ratio decreases (Lee et al., 1991).
Other specific solute-solvent and solvent-sorbent interactions increase the
complexity of describing sorption of ionizable organic compounds in mixed
solvents systems (Lee et al., 1992). The pKa of acidic functional groups
associated with the sorbent may increase upon addition of solvents (Lee et al.,
1992). Thus, in the presence of solvents at a given pH, the functional groups
become more neutral and reduce electrostatic interactions. In addition, the pKg
of the quinoline decreases upon addition of cosolvents. Therefore, at a given
pH the amount of neutral species present increases. These solvent-sorbent
and solute-solvent interactions may enhance the migration of molecules within
the matrix by increasing the permeability and reducing specific quinoline-sorbent
interactions, thereby reducing sorption nonequilibrium. However, the fraction of
instantaneous sites may decrease.
Addition of methanol (30%) reduced quinoline sorption (Figure 2-12).
Quinoline solubility increases with increasing volume fraction methanol


146
CSFTRs present a technique to investigate rapid biodegradation kinetics
and the interaction sorption and biodegradation. At this point in time,
improvements in the CSFFR design are necessary to fully utilize this technique.
However, simple modifications such as working with glass vessels, larger
sorbent particles, and slower propeller speeds may improve this technique.
Biodegradation is likely limited by two factors in soils, aquifers, and
sediments: 1) bacterial-sorbent associations; and 2) contaminant-sorbent
associations. In this investigation, 2HQ biodegradation decreased upon
introduction of soil particulates. Soil particles likely coated the bacterial surface
reducing the available surface area, thereby reducing bacterial activity. The
membrane-mediated biodegradation of quinoline was only slightly reduced upon
introduction of soil particulates suggesting quinoline was able to access to the
bacterial surface. However, due to rapid kinetics reduced biodegradation may
not have been detected. Particle-associated bacterial activity may vary with the
sorbent. Greater activity of particle-associated bacteria might be expected
when sorbed onto nutrient-rich organic matter and clay mineral regions.
The major constraint is believed to be diffusion- and desorption-limited
biodegradation. Therefore, facilitating the release of contaminants may enhance
bioremediation efforts. Contaminants sorbed within the interior regions of
phyllosilicate minerals and organic matter matrices are unavailable to
microorganisms due to size constraints. The spatial arrangement of
microorganisms and contaminants in the soil matrix largely controls the
potential for biodegradation.


160
DiGrazia, P.M., J.M. Henry King, J.W. Blackburn, B.A. Applegate, P.R. Bienkowski,
B.L. Hilton, and G.S. Sayler. 1991. Dynamic response of naphthalene
biodegradation in a continuous flow slurry reactor. Biodegradation. 2:81-91.
Ehrlich, H.L., and C.L. Brierley. 1990. Microbial mineral recovery. McGraw-Hill, New
York.
Fletcher, M. 1986. Measurement of glucose utilization by Pseudomonas fluorescens
that are free-living and that are attached to surfaces. Appl. Environ. Microbiol.
52:672-676.
Fletcher, M. 1991. The physiological activity of bacteria attached to solid surfaces, p.
54-85. In A.H. Rose and D.W. Tempest (eds.), Advances in microbial
physiology. Vol. 2., Academic Press, Harcourt Brace Jovanovich, New York.
Fu, J.-K., A.M. ACSE, and R.G. Luthy. 1986a. Effect of organic solvent on sorption of
aromatic solutes onto soils. J. Environ. Engin. 112:346-366.
Fu, J.-K., A.M. ACSE, and R.G. Luthy. 1986b. Aromatic compound solubility in
solvent/water mixtures. J. Environ. Engin. 112:328-345.
Gamerdinger, A.P., A.T. Lemley, and R.J. Wagenet. 1991. Nonequilibrium sorption and
degradation of three 2-chloro-s-triazine herbicides in soil-water systems. J.
Environ. Qual. 20:815-822.
Gamerdinger, A.P., R.J. Wagenet, and M.Th. van Genuchten. 1990. Application of two-
site/two region models for studying simultaneous nonequilibrium transport and
degradation of pesticides. Soil Sci. Soc. Am. J. 54:957-963.
Gerstl. Z. 1990. Estimation of organic chemical sorption by soils. J. Contam. Hydrol.
6:357-375.
Gibson, D.T., and G.S. Sayler. 1992. Scientific foundations of bioremediation current
status and future needs. American Academy for Microbiology, Washington, DC.
Goldstein, R.M., L.M. Mallory, and M. Alexander. 1985. Reasons for possible failure of
inoculation to enhance biodegradation. Appl. Environ. Microbiol. 50:977-983.
Gordon, A.S., and F.J. Millero. 1985. Adsorption mediated decrease in the
biodegradation rate of organic compounds. Microb. Ecol. 11:289-298.
Gray, T.R.G., R. Hisset, and T. Duxbury. 1974. Bacterial populations of litter and soil in
a deciduous woodland. I!. Numbers, biomass and growth rates. Rev. Ecol. Biol.
Sol. 11:15-26.


61
Quinoline may also be drawn into a planar orientation (Figure 2-1 Ob)
delocalizing the charge over the whole quinoline molecule. At this stage,
quinoline molecules in the solution phase may pass further into the interlamellar
regions of the clay mineral due to compensation of the electrostatic charge by
the previously sorbed quinoline molecule (Figure 2-1 Oc). Some of these sites
may essentially be inaccessible once quinoline has occupied the interior of clay
minerals and formed a stable surface complex. After breakthrough and
washout of quinoline from the Norborne soil columns, mass balance suggested
that 5 to 10 % of the quinoline introduced into the column remained on the soil.
Repeated washing with 80% methanol was insufficient to completely wash out
residual quinoline within the interior clay aggregates. Introduction of a cation
more selective for the exchange complex than quinoline would be a more
efficient method for removing quinoline from the exchange complex.
The inability to successfully remove residual quinoline from interlayer
positions further supports that strong quinoline surface complexes are formed
or that the interlayers have collapsed (Figure 2-1 Od). This depicts the
tetrahedral layer charge being drawn to the quinoline molecule and collapse the
interlayer spacing restricting further migration into this region. Electrical
neutrality must be maintained at all times suggesting that two quinoline
molecules must replace one calcium. Therefore, the total collapse of the
interlayer regions is not likely. However, formation of strong surface complexes
and several molecules sorbed in the interlayers may create a buildup of
molecules redistributed throughout the interlamellar region.


Relative Concentration (C/CJ
51
Pore Volumes (p)
Figure 2-8. Quinoline breakthrough curves in 0.005 M (closed
symbols) and 0.05 M CaCI2 (open symbols) in pH
adjusted Norborne soil columns.


41
Eustis
O Sterile Eustis
. <§>
- Webster
El Norborne
- *
Sterile Norborne
Jo

% *'
i
Wr
H
-V
i

J
hi n
. i j i i
1 1 1 1 1 1
i i i I i i i i i
-9 >8 -7 -6 -5 -4
Log C| [mol QH+/L]
Figure 2-3. Quinoline sorption isotherms for three soils normalized
to their cation exchange capacity and to the fraction of
protonated species (See eq 2-7).


4
A lack of consideration of physico-chemical and biological processes can
result in discrepancies between model predictions and experimental
observations. Investigation of organic chemical behavior in natural systems
and development of solute transport models that account for biodegradation
and sorption are necessary to adequately predict the environmental behavior of
such chemicals. These models can then be used to gain insight into the
processes that affect the fate of chemicals in the environment, for prescribing
management strategies that prevent or minimize groundwater contamination,
and for designing effective remediation procedures for contaminated sites.
Coupled-process models attempt to describe contaminant sorption,
degradation, and water flow by incorporating pertinent processes controlling the
fate of contaminants. Mathematical descriptions of existing coupled-process
models were reviewed by Brusseau et al. (1992). Development of an unbiased
coupled-process model requires a multidisciplinary approach. However, models
often contain a particular emphasis on a single process depending on the
researchers background. The conceptual basis for the coupling of sorption
and biodegradation during transport was presented by Rao et al. (1993b).
Emphasis was given to the importance of adequately describing contaminant
sorption and the impact of the biomass on contaminant behavior.
Various levels of complexity arise when describing the processes that
control contaminant behavior. Frequently models are limited by the ability to
accurately measure the parameter of interest. When dealing with aquifer


CHAPTER 1
INTRODUCTION
The motivation for this dissertation arose from my desire to work with
microorganisms and to determine their potential for bioremediation of
contaminated soils, aquifers, and sediments. There is an illusion that bacteria
are fragile, delicate creatures. The reality of the situation, after working with
them for the last few years, is that they at times seem to have a mind of their
own. They have the capability to alter their environment in order to enhance
their very existence. I believe that their potential in bioremediation practices is
unlimited if we can only come to understand how they interact with their
environment. As Marshall (1976) stated:
It is my belief that many microbiologists fail to appreciate the effects of
interfaces on microbial populations, despite the widespread occurrence
of solid-liquid, gas-liquid, and liquid-liquid interfaces in natural microbial
habitats. . Importance must be given to the nature, distribution, and
unique physicochemical properties of interfaces, the interaction between
microorganisms and interfaces, and the modifying effects of interfaces on
the ecology of microorganisms, (v)
Overview of the Problem
The improper use and accidental release of toxic organic compounds
into the environment have led to widespread contamination of soils and
1


Fraction QH
29
Figure 2-2. Quinoline speciation diagram and the protonated and
neutral species structures.


138
deficient in Fe. However, the rate of quinoline degradation and 2-HQ
production was much slower than in the previous studies. This suggests that
other nutrients may be limiting or the microbial population may have been
altered after extensive rinsing of the soil column.
Quinoline degradation was rapid at all flow rates (0.2 to 2 mL/min) such
that quinoline was not in the effluent from a 5 cm column after introduction of 5
mg/L quinoline. Biodegradation was also rapid in soil columns adjusted to pH
5. Alteration of pH may have decreased bacterial activity; however, sorption
increased and quinoline was not detected in the column effluent. Thus,
quinoline biodegradation kinetics could not be assessed. Altering conditions
including dissolved oxygen and nutrient content and pH suggests that
biodegradation occurs at high rates and efficiencies. However, this
experimental design is not appropriate for measuring rapid quinoline
biodegradation kinetics. To monitor rapid biodegradation rates, a CSFTR would
facilitate rapidly monitoring quinoline in the effluent and allow for detection of
quinoline loss over time. Therefore, a CSFTR was designed to enable detection
of rapid quinoline biodegradation in flow-through systems. However, in cases
where biodegradation is slower column techniques provide means of measuring
sorption and biodegradation rates.
CSFTR
Biodegradation in solution. Biodegradation of quinoline was monitored to
investigate the time required to achieve steady state and to measure the


120
more active than nonattached bacteria (see Griffith and Fletcher, 1991 for
further references). Particle-associated bacteria are generally larger due to
increased nutrient and substrate concentrations (Iriberri et al., 1987). However,
normalizing activity on a biomass basis was suggested to alleviate such
differences. The consequences of surfaces and variable environmental
conditions makes extrapolation from lab-scale studies to field-scale
bioremediation applications difficult. Much like the influence of surfaces on
bacterial activity, the proposed influence of sorption on biodegradation is just as
varied.
Biodegradation of quinoline and other contaminants in soils, sediments,
and aquifer materials is controlled by several factors (see Chapter 1).
Conditions must be favorable to stimulate bacterial activity and biodegradation.
For example, microbial populations require essential nutrients, carbon and
energy sources, and electron donors or acceptors to maintain their
physiological functions, whether a bacterial isolate degrades an organic
contaminant aerobically or anaerobically via intracellular or extracellular
mechanisms. Environmental factors such as oxygen content, pH, and
temperature may also alter bacterial activity.
In the context of this dissertation, factors important in describing the
biodegradative behavior of quinoline by the 3N3A isolate will be addressed in
this chapter. Oxygen content, limiting nutrients, pH, and the influence of
surfaces in flow-through systems are factors of interest. With regard to pH, not


59
0.92 nm is occupied by an octahedral and tetrahedral layer. Therefore, the
interlamellar region is approximately 0.68 nm. This procedure was limited by
the fact that only 1 % of the total CEC sites were occupied by quinoline; 99% of
the exchange sites were occupied by Ca. Therefore, no changes were
detected. To enable the detection of d spacing changes a larger fraction of
sites would need to be saturated with quinoline. However, saturating the
exchange complex with quinoline would likely alter the sorption mechanism and
would not be comparable to low quinoline concentrations (see Figure 2-3).
Figure 2-10 conceptualizes the process hypothesized for quinoline
sorption onto smectite clay minerals. The size of the interlayer spacing of the
smectite clay, the Ca, and quinoline are approximately drawn to scale.
Quinoline replaces Ca on edge and readily accessible interlayer CEC sites
(Figure 2-10a), representing the fraction of instantaneous sites (F) associated
with the clay minerals. After this initial step, quinoline must desorb and migrate
further within the interlamellar region of the clay mineral. Displacement of Ca
by quinoline in interlayer regions may be physically constrained (Figure 2-10a),
which may contribute to sorption nonequilibrium. Ca is hydrated and initially
occupies CEC sites in the interlayer positions. Smith et al. (1992) suggested
that quinoline displaced interstitial water upon reorientation to a planar position
on the surface. Therefore, the hydration energies associated with quinoline and
40Ca may be important in understanding rate-limitations of quinoline sorption.


3
biodegradation is unaffected by sorption. The first example suggests that
differences in biodegradation may be due to the soil sorption capacity and/or
variations in microbial activity. The second example suggests that differences in
biodegradation are due solely to variations in microbial activity and bioavailability
(sorption of contaminants) is not a factor.
The use of bioremediation technology is hinged upon improving existing
knowledge of the controlling processes and their appropriate coupling such that
the probability and predictability of remediating a contaminated site are
increased. To fulfill this task it is necessary to 1) determine the reasons for
bioremediation failures; 2) develop predictive coupled-process models for
describing contaminant fate in the environment; and 3) determine the
ramifications of introducing bacteria or stimulating bacterial growth in soil and
aquifer materials to promote biodegradation of contaminants.
The success of bioremediation of contaminated soils and groundwater is
limited due to (1) the ability to degrade chemicals to an acceptable level and (2)
the ineffectiveness of laboratory-tested microorganisms to biodegrade
chemicals under field conditions. Understanding the physical and chemical
constraints of biodegradation in soils and aquifers may improve the designs of
bioremediation programs and provide an understanding of the reasons for
chemical persistence. Therefore, information is needed regarding microbial
transformations of organic chemicals in soil-water systems, as affected by the
interaction of chemical, physical, and biological processes.


37
kinetics. The soil fraction < 50 /m was used in the stirred batch reactor to
minimize separation of the soil suspension. The soil fraction (2 g) was added to
150 mL 0.005 M CaCI^ At various time intervals, the suspension was sampled
and immediately separated through a 0.45 /m teflon filter. The filtrate (C) was
analyzed to determine the quinoline concentration at various time intervals for 4
days. Flow-through column techniques (Brusseau et al., 1990) were utilized to
determine sorption rate coefficients for quinoline using sterile background matrix
solutions. The sterile soil was packed into a Kontes glass column (5 cm long,
2.5 cm i.d.). Bed supports on both ends of the column consisted of a teflon
diffusion mesh with a glass membrane porous filter (1 /urn). The pumps and
tubing were disinfected by rinsing with methanol. The glass columns and
solution vessels were sterilized by autoclaving. After packing, approximately
150 pore volumes of 0.005 or 0.05 M CaCI2 solution were pumped through the
column to achieve saturated, steady water flow conditions. Experiments were
conducted under saturated, steady water flow conditions at pore water
velocities of 15 to 90 cm/hr. In displacement studies, the molarity (0.005 M,
0.05 M) and pH of the displacing solution were varied.
Solute concentrations were monitored continuously or by collecting
column effluent fractions. Flow through UV detection (Gilson Holochrome or
Milton Roy LDC) was monitored continuously at 230 nm for quinoline and 2-HQ
and 254 nm for PFBA. Detector response was recorded using a strip chart
recorder (Fisher Series 5000). Effluent samples were collected intermittently


Relative Concentration (C/Q,)
46
Figure 2-6. Examples of breakthrough curves for PFBA and 3H20
in Norborne soil columns.


88
PFBA remained constant (indicative of no blockage or exclusion of some
pores). Therefore, early breakthrough of quinoline and naphthalene was not
the result of pore blockage by bacterial biomass.
Biofacilitated Transport
Bacterial migration. Biofacilitated transport required verification of
bacterial migration and biosorption. Bacterial migration in the Norborne C soil
was investigated by packing the outlet half (2.5 cm) of a column with sterile soil
while the inlet half (2.5 cm) was packed with B53 inoculated soil (106 cfu/g).
The appearance of 300 cfu/mL in effluent fractions after displacement of 75
pore volumes verified bacterial migration through a half sterile and half
inoculated Norborne soil column. Bacterial counts were similar using plate
count techniques and by visual inspection using a hemacytometer. Therefore,
bacterial populations were subsequently determined by plate counts. After 7
days of flow (13.5 cm/hr), the column was sectioned into 1-cm segments and
bacteria were extracted with a pH 7.3 phosphate saline solution which was
recommended as a standard microbial technique (Wollum, 1982). The soil-
saline suspension was diluted, allowing the soil to settle, and plated. The
bacterial density was 108 cfu/g at the inlet end of the column, 107 cfu/g in the 3
center sections of the column, and 106 cfu/g at the end of the column. Three
observations noted were: 1) increased bacterial densities verified bacterial
growth; 2) populations decreased from the inlet to the outlet end of the column
in response to inoculation of the inlet 2.5 cm of the column; and 3) bacteria


2
aquifers. Treatment of contaminated materials has included excavation,
incineration, vapor extraction, and soil washing technologies. These treatments
are often costly and only result in a transfer of the contaminant from one phase
to another. However, implementation of above ground and in situ
bioremediation practices may lead to degradation of organic contaminants.
Bioremediation practices using laboratory tested microbial populations
have failed to achieve adequate levels of cleanup for reasons which will be
discussed. Failures are not surprising because frequently laboratory studies
investigate processes in isolation and attempt to extrapolate to field sites where
temperature, pH, soil water content, and microbial populations vary daily and
seasonally. As Rao et al. (1993a) so accurately described:
Most laboratory-scale experiments, and some field-scale studies, are
designed for investigating environmental processes in isolation; at least
attempts are made to do so by controlling most variables except the one
whose impact upon the system is being investigated. In real-world
scenarios, even in the simplest of laboratory experiments, however, the
rates and magnitudes of a reaction or a process are often controlled by
one or more other processes, each of which may have its own set of
unique control variables at different spatial and temporal scales. This is
indeed the case for laboratory experiments and field studies on fate and
transport of organic chemicals in soils and aquifers. An explicit
understanding of the coupling and feedback among simultaneous
processes is essential in explaining experimental observations and for
developing predictive models. (1)
To illustrate the importance of process coupling, Rao et al. (1993a)
presented two different scenarios. In one case, sorption renders the
contaminant unavailable for biodegradation and in the second case


60
1.6
0.68
nm
Sorption onto readily accessible sites
Figure 2-10. Conceptual diagram of quinoline sorption onto smectite clay minerals.


143
surfaces on bacterial activity. Alteration of quinoline and 2-HQ behavior would
indicate bacterial activity had been altered in the presence of surfaces.
The influence of surfaces on bacterial activity (biodegradation) was
investigated after steady state was attained for biodegradation of quinoline to 2-
HQ to other metabolites. At 2000 and 1500 minutes (Figure 4-13a, b,
respectively), 0.2 g of the Norborne silt and clay mixture was added into the
CSFTR. Addition of surfaces in this system (small mass to volume ratio) did not
contribute substantially to the quinoline sorption (R = 1). If quinoline sorption
were measured at higher mass to volume ratios (R> 1), diffusional constraints
would decrease due to complete mixing of the soil and increase the fraction of
instantaneous sorption. In Figure 4-13a, addition of soil initially decreased
quinoline and 2-HQ degradation. The overall degradation of quinoline appeared
to be reduced to about 0.3 mg/L. The 2-HQ reached a concentration of 2
mg/L followed by a decrease to 0.3 mg/L
In Figure 4-13b, the response to the addition of soil was noticeably
different. Degradation of quinoline did not appear to be influenced by the
addition of soil. 2-HQ degradation appeared to be reduced substantially and
maintained a lower degradation rate. The biodegradation of quinoline to 2-HQ
and 2-HQ to other metabolites was fit by a first-order biodegradation model
assuming steady state conditions. The kbQ was 6.6 minutes'1 and the kbHQ was
0.18 minutes'1.


Relative Concentration (C/Q,)
49
Figure 2-7. Quinoline and 45Ca breakthrough curves with flow
interruptions in 0.005 M (closed symbols) and 0.05 M
(open symbols) CaCI2 Norborne soil columns.


167
Stevenson, F.J. 1985. Geochemistry of soil humic substances, p. 13-52. In G.R. Aiken,
D.M. McKnight, R.L. Wershaw, and P. MacCarthy (eds.), Humic substances in
soil, sediment, and water. John Wiley & Sons, New York.
Stotzky, G. 1966. Influence of clay minerals on microorganisms. III. Effect of particle
size, cation exchange capacity, and surface area on bacteria. Can. J. Microbiol.
12:1235-1246.
Stotkzy, G. 1985. Mechanisms of adhesion to clays with reference to soil systems, p.
195-253. In D.C. Savage and M. Fletcher (eds.), Bacterial adhesion:
Mechanisms and physical significance. Plenum Press, New York.
Stotzky, G., and L.T. Rem. 1966. Influence of clay minerals on microorganisms I.
montmorillonite and kaolinite on bacteria. Can. J. Microbiol. 12:547-563.
Stratford, M., and P.D.G. Wilson. 1990. Agitation effects on microbial cell-cell
interactions. Letters Appl. Microbiol. 11:1-6.
Stucki, G., and M. Alexander. 1987. Role of dissolution rate and solubility in
biodegradation of aromatic compounds. 53:292-297.
Stucki, J.W., H. Gan, and H.T. Wilkinson. 1992. Effects of organisms on phyllosilicate
properties and behavior, p. 227-254. In R.J. Wagenet, P. Baveye, and B.A.
Stewart (eds.), Interacting processes in soil science. Advances in Soil Sci.,
Lewis Publishers, Boca Raton, FL.
Subba-Rao, R.V., and M. Alexander. 1982. Effect of sorption on mineralization of low
concentrations of aromatic compounds in lake water sediments. Appl. Environ.
Microbiol. 44:659-668.
Szecsody, J.E., and G.P. Streile. 1992. Process controlling the slow sorption of
quinoline onto clay during transport in columns. Chemosphere. 24:1127-1145.
Tan, Y., W.J. Bond, and D.M. Griffin. 1992. Transport of bacteria during unsteady
unsaturated soil water flow. Soil Sci. Soc. Am. J. 56:1331-1340.
Trevors, J.T., J.D. van Elsas, L.S. van Overbeek, and M.-E. Starbodub. 1990.
Transport of genetically engineered Pseudomonas fluorescens strain through a
soil microcosm. Appl. Environ. Microbiol. 56:401-408.
Truex, M., F.J. Brockman, D.L. Johnstone, and J.K. Fredrickson. 1992. Effect of
starvation on induction of quinoline degradation for subsurface bacterium in a
continuous-flow column. Appl. Environ. Microbiol. 58:2386-2392.


20
where kb represents the pseudo first-order rate constant (1 /T) for
biodegradation (assumed to occur only in the solution phase), Kf is the
Freundlich sorption coefficient (mlJ1/n) and 1/n is the Freundlich
sorption isotherm coefficient. Note that the Freundlich model (eq 1-1) is used
to represent equilibrium sorption isotherms. Thus, isotherm nonlinearity may be
accounted for with this model which results in nonlinear mass transfer and
mixed order (1 /n) equations. The model may be written in nondimensional
form (Nkedi- Kizza et al., 1989):
+(/?fi-1U1/n)C*(1/n)"1
(1-8a)
(1 -p)R?*L. = o (C*(1/n)-S*)
dt
(1 -8b)
by defining the following dimensionless parameters: C* = C/C0, p = vt/L, X =
x/L, y = kv/L, S* = [S2/(1 -F)KfC0^1 /n>1 ], R = [1 + ((p/0) K,C0(1/n)-1)] is the
retardation factor, which represents equilibrium sorption; P = vL/D is the Peclet
number, which represents the hydrodynamic dispersion in the column;
¡3 = {[1 + (Fp/e)K,C0<1/n>-1]/R} represents the fraction of instantaneous


155
Aerobic transformation processes require the presence of oxygen for
biodegradation. In soils, sediments, and aquifers, oxygen contents are dependent
on the soil type and moisture content. Quinoline biodegradation occurred rapidly
at levels as low as 0.5 mg/L. In surface soils, providing adequate draining may
facilitate oxygen diffusion and supply the required levels of oxygen for
biodegradation. If contaminant concentrations and microbial activity are high,
oxygen may be depleted even in well-drained soils. Land farming techniques also
increase oxygen contents in the surface soil. However, deeper soils and aquifer
materials may need oxygen injections or by fluctuating the water table by well draw
down to increase oxygen mixing.
Addition of nutrients is required to sustain growth and metabolism of
microorganisms. The column studies suggested that after extensive leaching,
addition of Fe increased quinoline degradation. In offshore seawater,
biodegradation of crude oil was increased upon addition of Fe (ferric octoate)
along with nitrogen and phosphorus. Field scale studies suggested addition of
nutrient solutions increased biodegradation of components of fossil fuels (Pritchard
and Costa, 1991).
Bacterial Activity in the Sorbed- Versus Solution-Phase
Sorption of microorganisms to sorbent surfaces was suggested to decrease
quinoline biodegradation in systems supplied with adequate nutrients. Alteration
of physiological functions [i.e., transport recognition functions (Brockman et a!.,
1990)] likely decreased bacterial activity and reduced biodegradation. Blockage


Discussion 98
Summary 101
4 QUINOLINE BIODEGRADATION IN FLOW-THROUGH
SYSTEMS 103
Introduction 103
Quinoline Biodegradation Dynamics 121
Research Question and Tasks 126
Material and Methods 127
Results and Discussion 132
Summary 145
5 SUMMARY AND CONCLUSIONS 148
Summary 148
Conclusions 154
REFERENCES 157
BIOGRAPHICAL SKETCH 170
vi


57
Table 2-3. Summary of estimated transport parameters for quinoline.
ID
pH
R
Kf
CO
6
F
k2
BQ5
7.0
11.0
3.18
0.762
(0.52-1.0)*
0.536
(0.47-0.59)
0.493
1.336
Floint
6.2
12.6
3.87
0.814
(0.41-1.22)
0.508
(0.43-0.59)
0.466
1.337
pH4
4.7
28.6
8.58
0.178
(0.17-0.18)
0.821
(0.79-0.85)
0.814
0.074
BQ10
3.0
140
43.1
0.261
(0.11-0.41)
0.503
(0.26-0.75)
0.499
0.041
BQ2
4.75
0.69
1.727
(0.98-2.47)
0.507
(0.41-0.60)
0.375
8.286
DCMA
5.3
11.0
1.82
0.984
(0.39-1.58))
0.535
(0.42-0.65)
0.488
2.615
* values in parenthesis are 95% confidence intervals.
and exterior regions of organic matter. Simultaneously describing the large
fraction of instantaneously accessible sites and the slow redistribution of
quinoline within the clay interlayers is not possible using the bicontinuum model.
Therefore, rapid sorption of the quinolinium ion followed by the rate-limited
diffusion of quinoline into the phyllosilicate minerals is not an accurate
conceptualization for quinoline sorption.
Specific chemical interactions (e.g., hysteresis, reconfiguration of the
molecular arrangement) likely limit desorption, and steric hindrances may limit
redistribution within phyllosilicate minerals. The molecular configuration was
suggested to change from an upright position to a planar position within clay
minerals (Zachara et a!., 1988). As a result, desorption is strongly inhibited due
to delocalization of charge over the entire molecular surface. Subsequent
migration within interlamellar regions may be restricted due to desorption and


93
inoculated with bacteria. Therefore, biosorption of quinoline and 45Ca was
determined directly in column experiments. Filtration (0.2 /im) of the column
effluent to separate biosorbed (trapped with the biomass on the filter) and free
species (in the filtrate) showed no reduction in the solution concentration or
accumulation on the filter. Therefore, biofacilitated transport of quinoline and
45Ca by bacteria in the solution phase was not likely.
Surface Blockage
Alterations of soil surfaces by the addition of microorganisms may occur
directly as a result of bacterial sorption onto surfaces. Therefore, the potential
for 3N3A and B53 isolates to adhere onto surfaces was determined by
measuring their electrophoretic mobility and hydrophobicity. Electrophoretic
mobility of the bacteria was measured in a mineral salt solution used by
Brockman et al. (1989). The zeta potential of the 3N3A and B53 isolates was
determined using a Laser Zee Meter (PENKEM Model 501). The bacterial-
buffer solution (30 mL) was placed in an electrophoresis chamber consisting
of two electrodes and a connecting chamber. The rate of bacterial movement
in a known electric field was monitored through a microscope with a 20x
objective lens and a 15x ocular lens. All measurements were made in the
stationary layer to avoid flow in the boundary layers. Zeta potential was
converted to electrophoretic mobility using the Helmholtz-Smoluchowski
equation (Sherbet, 1978). The electrophoretic mobility of the 3N3A isolate
ranged from -1.0 to -1.5 108 meter/V/sec from pH 4 to 8.5. Over the same pH


Relative Concentration (C/Qj)
55
Figure 2-9. Repeated flow interruptions for quinoline in a 0.05 M
CaCI2 (pH 6.2) Norborne soil column and bicontinuum
model fit.


In (C/Crt)
43
Figure 2-4. Stirred batch reactor (a) and quinoline sorption onto
the Norborne soil fraction < 50 Mm (b) (where C =
quinoline filtrate concentration and C0 = the initial
quinoline concentration).


5
materials, steady water flow is assumed. However, the unsaturated zone adds
seasonal variations in soil water content and temperature which directly or
indirectly impact the primary processes controlling the fate of contaminants. A
description of the sorption dynamics is primarily concerned with equilibrium or
rate-limited reactions, whereas microbial processes require descriptions of
microbial kinetics (e.g., growth and biodegradation) and biomass distribution.
Extensive data have been gathered describing individual processes that
determine the behavior of hydrophobic organic compounds (HOCs).
Equilibrium sorption coefficients (Kp) for HOCs can be estimated from aqueous
solubility and octanol-water partition coefficients among others (cf., Green and
Karickhoff, 1990; Gerstl, 1990). The sorption mass-transfer coefficients (k2) can
be estimated for a variety of soils and HOCs from the inverse, log-log
relationship noted between k2 and Kp (Brusseau and Rao, 1989a) or Koc
(Augustijn, 1993). Specific interactions between ionizable organic acids and soil
caused deviations from the behavior of HOCs (Brusseau and Rao, 1989a).
Complex sorption interactions of organic bases such as the nitrogen
heterocyclic compounds (NHCs) in soil have not been adequately investigated
to assess if this relationship is valid for NHCs.
The estimation of the model parameters related to biomass growth
dynamics of specific degraders and substrate degradation kinetics in soil and
aquifer materials is somewhat uncertain. Monod-type equations are used to
describe the behavior of pure culture systems. However, these models did not


13
suggesting the influence of surfaces on bacterial activity have been dismissed
because of possible secondary responses occurring at the surfaces (van
Loosdrecht et al., 1990). Ogram et al. (1985) demonstrated that sorbed 2,4-
dichlorophenoxy acetic acid (2,4-D) was protected from biodegradation and that
only the solution-phase 2,4-D was degraded by free and attached bacteria. The
degradative activity of free and attached bacteria, however, could not be
differentiated. In a similar study, 2,4-D was suggested to be degraded by
bacteria in the sorbed and solution phase (Zou et al., 1992); however,
degradation rates were thought to be faster by "free" bacteria rather than
sorbed-phase bacteria. Aamand et al. (1989) also suggested that only bacteria
in the solution phase were degrading the aquifer contaminants.
More recently, Guerin and Boyd (1992) argued that a bacterial isolate (P.
putida 17484) was capable of utilizing sorbed naphthalene from the surface,
contrary to the paradigm that degradation occurs intracellularly. Another
bacterial isolate (NP-Alk) was thought to be unable to degrade naphthalene in
the sorbed- phase. Therefore, organism-specific properties must be considered
in determining the potential for degradation. These observations will be
discussed further in Chapter 4. Determining the influence of surfaces on
biodegradation and whether or not bacteria have the ability to degrade
contaminants in the sorbed or solution phase is still unresolved. Further, a
predictive model requires knowledge of the distribution of the active microbial
biomass and microbial growth dynamics (e.g., contingent upon substrate,