Abstract: A method of preparing a high heating value fuel product that comprises the steps of blending a high heating value sludge material with a cellulosic material, adding a microencapsulation reagent to the blended mixture of the sludge and the cellulosic material, introducing a pozzolanic agent to the blended mixture for controlling the rate of solidification, and forming the blended mixture into a form suitable for handling. The sludge is a material having a heating value of greater than 7,000 BTU. This sludge may be a complex mixture of organic hazardous waste streams. The cellulosic material is a silica-containing particulate material having a high heating value. The microencapsulating reagent is a mixture having a 4-15 weight percent of a chemical selected from the group of triethylene glycol, diethylene glycol, and glycerin propylene glycol. The microencapsulation reagent further may include a 20-32 weight percent calcium chloride solution. The pozzolanic agent is added to the mixture at a constant rate.