Tag: cadiz inc.

Downtown-based water infrastructure developer Cadiz Inc. has turned to an unusual source to help fund the development of a groundwater bank under its Mojave Desert holdings: a Northern California Native American tribe.

On Oct. 28, Cadiz announced that it had executed an agreement with the

Santa Rosa-based Lytton Rancheria of California Native American tribe for the tribe to provide an investment of up to $51 million for the construction and development of the Mojave Groundwater Bank. It’s the first tribal investment in the Cadiz water infrastructure project.

This investment is also the first tranche of up to $450 million that Cadiz is seeking to raise to fund the construction of the groundwater bank. For this effort, Cadiz has set up an entity it has called the Mojave Water Infrastructure Co.

The groundwater bank is the latest iteration of Cadiz’ decades-long effort to win approvals to pump and transfer water from its Mojave Desert aquifer to water customers in Southern California and throughout the state.

At each turn, as Cadiz has gone through permit and environmental approval hoops, opponents have moved to block the project, citing concerns about the potential damage to desert ecosystems from draining the aquifer. The company maintains that it would not draw down water faster than the aquifer is recharged through new underground inflows.

The main new features of the planned Cadiz Mojave groundwater bank are the involvement of Native American tribes and an emphasis on providing water to communities that are underserved by existing water supplies.

Initial proceeds of about $15 million from the Lytton Rancheria investment are expected to reimburse the company for project development expenses. Additional draws from the investment are anticipated to fund deposits on equipment necessary for construction of project facilities.

“This agreement marks a historic milestone for Cadiz and establishes a powerful new business model for building critical infrastructure,” Susan Kennedy, chief executive of Cadiz, said in the announcement.

Kennedy added that Lytton Rancheria Chairman Andrew Mejia’s vision “has opened the door to what could be a whole new era for water in the West.”

The company said in its announcement that it plans to break ground on construction of the water infrastructure bank next year. But in past decades, Cadiz has made similar pronouncements, only to be stymied by lawsuits, new regulatory moves or other opposition.