Differential scanning calorimetry (DSC) is applied to investigate the formation of cyclopentane hydrates in a water-in-oil emulsion. Protocols of cooling below the ice formation temperature and warming to a temperature above the ice and hydrate melting temperatures are applied. Cyclopentane, which forms hydrates at atmospheric pressure, is a component of the continuous oil phase in the hydrate-forming emulsion and is replaced by iso-octane to obtain a comparable ice-forming emulsion. A method based on comparing the heat flow measured by DSC for samples of identically prepared hydrate-forming and non-hydrate (ice-forming) emulsions is developed to obtain the rate of cyclopentane hydrate growth. Results are reported for a 40% water volume fraction emulsion. Experimental results lead to the conclusion that the hydrate formation takes place primarily at the interface between water drops and the continuous oil phase. In the absence of surfactants, a robust hydrate "shell" develops around the water drop limiting transport of hydrate former to the free water which remains trapped inside the hydrate layer. Direct visualization of hydrate formation in larger water drops under the influence of oil-soluble surfactants shows that the hydrate crystals have much smaller features and the appearance is hairy or mushy. A three-step mechanism - nucleation, surface growth and radial growth - is described to capture the main features of the hydrate formation process. Mechanical stresses developed in the hydrate shell due to volume expansion upon hydrate formation (a liquid-solid transition) are analyzed. (C) 2011 Published by Elsevier Ltd.