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This article presents the chemical formulation and rheological properties of a novel self-assembling biopolymer (SAP) system, which could be a useful alternative in polymer flooding for oil recovery, especially under harsh reservoir conditions of temperature, salinity, and hardness. The nonbonding associations of the side branches of xanthan gum with the surfactant: β-cyclodextrin inclusion complexes in aqueous solution generate an improved viscoelastic SAP network system. This system exhibits superior mechanical and thermal stability, and also tolerance to elevated brine salinity and hardness due to the “interlocking effect.” Sandpack flood tests conducted at reservoir conditions (Pelican Lake reservoir, Alberta, Canada) demonstrate that the SAP system can produce considerably higher resistance factors than the baseline xanthan gum during flow in porous media, which indicates its effectiveness in controlling the mobility of the displacing fluid. Moreover, this system shows potential as in situ permeability modifier. POLYM. ENG. SCI., 2014. © 2014 Society of Plastics Engineers