Hey [MENTION=887]ioFlow Studios[/MENTION]
Check this stuff out -
From the looks of it he is using a projection grid for the water.
There is also some interesting stuff on this site. Look under Proland. Source code is included from the look of it. Oceans, Atmospheric Scattering, and Clouds, for planets as well 
Looks it is distributed under the BSD-3 license. LINK