The Cadiz Valley Water Conservation, Recovery and Storage Project is designed to actively manage the groundwater basin underlying a portion of the Cadiz and Fenner Valleys in California’s Mojave Desert  and conserve renewable native groundwater that would otherwise flow to hyper-saline dry lakes and evaporate.

The Project would be implemented in two phases. The first phase would capture approximately 50,000 acre-feet (1 acre-foot = 326,000 gallons) of groundwater per year and deliver it via the Colorado River Aqueduct to water users throughout Southern California. In wet years, if supplies from the Project are not needed, water could be stored safely underground through active management by the wellfield. A second phase of the Project would use the available capacity in the soils beneath the ground to store up to 1 million acre-feet of imported water.  The imported storage phase of the project will undergo a separate environmental review and permit process after the first phase is implemented.

The Project is located in Cadiz, California at the base of the Fenner Valley and Orange Blossom Wash watersheds, which span approximately 1,300 square miles (roughly the size of the State of Rhode Island). The Project wellfield will be built on the Company’s property and a conveyance pipeline will be constructed along the Arizona & California Railroad (“ARZC”) right-of-way to connect the Project wellfield to the Colorado River Aqueduct in Rice, California (near Twentynine Palms, CA). Cadiz Inc. is the largest private landowner in the region with over 45,000 acres (70 square miles) of private land.

As of December 2011, Santa Margarita Water District (SMWD) , the Three Valleys Municipal Water District, Golden State Water Company, Suburban Water Systems, California Water Service Company and Jurupa Community Services District have signed option agreements with Cadiz Inc. for water supplies from the Project. SMWD is also acting as lead agency for the California Environmental Quality Act (CEQA) environmental review and permitting process since it was the first public agency to become a participating agency in the Project. The Arizona & California Railroad, which owns the right-of-way where the project’s conveyance pipeline will be constructed, will also be receiving water from the Project.

Southern California is an arid region and faces a long-term water crisis due to regulatory restrictions on its imported water supplies, population growth and rising costs. As a result, water providers must identify additional reliable, high-quality and affordable water supplies to build a balanced water supply portfolio and keep costs low for rate payers. Most Southern California communities rely on water imported from northern California and the Colorado River, and these supplies can be unreliable in dry years. The Project offers certainty in both wet and dry years that water will be available.

Water users in the service areas of the Project’s participating agencies, which combined serve over 1 million customers in Orange, Los Angeles, Riverside, San Bernardino and Ventura Counties, will receive supplies from the Project.

The Project is located at the base of the Fenner Valley and Orange Blossom Wash watersheds in California’s Eastern Mojave Desert. Every year, precipitation falls on the mountains in the watersheds as rain and snow. This water gradually percolates underground and is stored deep beneath the surface in the aquifer system. The underlying rock layers provide ideal conditions for storage of this pure water; research has found that more than 20 million acre-feet of water is currently stored in the alluvium beneath the Project area, as much as is stored in Lake Mead, the nation’s largest surface reservoir. Even more water is believed to be stored further underground in carbonate rock layers.

Groundwater in storage naturally flows downhill through the aquifer system over hundreds of years and ultimately into area dry lakes, where it becomes highly-saline and evaporates through the surface. To minimize the loss of this clean groundwater to evaporation, Project wells will intercept the groundwater and capture it before it reaches the highly-saline brine. Once implemented, the Project would conserve and recover millions of gallons of water every year for beneficial use throughout Southern California.

Detailed scientific analysis of the Project’s watersheds over many years has confirmed that the groundwater in the system is naturally renewable. A variety of scientific models have been used to estimate the amount of recharge occurring annually in the Watersheds surrounding the Project area.

In 2008 the United States Geological Survey (USGS) developed a new model called INFIL 3.0, which uses real data about a local area and local conditions, to estimate groundwater recharge. Applying the INFIL 3.0 model, which incorporates extensive data about local soils, vegetation, precipitation, temperatures, rock types, and field research of the Cadiz and Fenner Valleys, an estimated 32,000 acre-feet per year was projected as a long-term average amount of water that reaches below the root zone to become groundwater at the Project area.

To view a video about the water system, including results of the latest studies, visit http://cadizinc.com/videos/

Withdrawals of water will be limited to sustainable amounts that preserve the health of the aquifer and safeguard the desert ecosystem. Over the 50-year term of the Project, an average of approximately 50,000 acre-feet of water per year will be conserved and put to beneficial use in Southern California communities. This is significantly less water than could be used if Cadiz Inc.’s property, which is currently zoned for agricultural production, was farmed instead.

Springs are found in the upper elevations of the 1,300 square-mile watershed, far from the Project area. The springs are fed first from above by the rain and snow that falls at higher elevations. Water that does not reach a spring filters through the crevices in the rock layers to become part of the aquifer system.

The nearest spring to the Project area is Bonanza Spring located in the Clipper Mountains at 2,100 feet in elevation. It is approximately 11 miles from the Project area and is situated more than 1,000 feet above the saturated alluvial aquifer system.

Scientific analysis conducted in 2011 found no evidence, observed or modeled, demonstrating a physical hydrologic connection between the springs in the upper elevations of the watershed and the groundwater stored in the alluvial aquifer beneath the Project area. As a result, pumping water from the aquifer system beneath the Project area, miles away and deep below ground surface and fractures, could not harm the springs. Bonanza Spring will be monitored to demonstrate that it is not impacted by the Project.

Most of the area’s private wells are located at higher points in elevation and draw water before it reaches the alluvial aquifer system at the Project area. As a result, the area’s other private wells will not be affected by the Project. Water levels may fluctuate closer to theProject area and could lead to fluctuations (both up and down) in wells nearest the Project. To ensure that the Project does not impact these private wells, the Project’s Groundwater Management, Monitoring & Mitigation Plan  (GMMMP) will quickly identify and address any indications of impacts to well levels and adjustments will be made to operations.

Extensive study of the chemistry composition of the dry lakes confirms that unlike surface water fed dry lakes playas in  California, such as Owens Lake, the crusts of Bristol and Cadiz Dry Lakes are not susceptible to increased dust emissions from dewatering and will not harm air quality in the area. Nevertheless monitoring will be implemented even though there are no expected impacts.

The Project will undergo extensive study, be reviewed by public agencies, and provide the public opportunities to comment before facilities could be built. In December 2011, following more than two years of significant technical analysis and field survey of environmental resources at the Project area, the Santa Margarita Water District (SMWD) issued a Draft Environmental Impact Report (DEIR) pursuant to the California Environmental Quality Act (CEQA) for the Project. The Draft EIR considered peer-reviewed technical reports, as well as independently collected data, scientific modeling and a new state of the art Groundwater Management, Monitoring and Mitigation Plan (GMMMP) to complete its analysis of the Project. The Draft EIR summarizes that, with the exception of unavoidable short-term construction emissions, by implementing the measures developed in the GMMMP, the Project will avoid any significant impacts to desert resources, including critical resources of the desert environment such as vegetation, mountain springs, and water and air quality. To view a copy of the DEIR, visit www.smwd.com. A Final EIR is expected to be released this year. Once the Final EIR is certified, permits authorizing construction could be issued.

As a member of the Cadiz Valley community for over 25 years, the Company is committed to the highest standard of environmental protection and good stewardship of the surrounding desert environment and water resources. In 2009, Cadiz Inc. entered into a Green Compact with the Natural Heritage Institute (NHI) to ensure that its projects operate sustainably. Since that time, the Company has also invested in significant technical and environmental analysis of the Project area to ensure that the environment is protected. To ensure minimal disturbance of the desert landscape and habitats, Project operations would be concentrated to Cadiz’s pre-disturbed agricultural land and the ARZC Railroad right-of-way.

A Groundwater Stewardship Committee (GSC) comprised of leading experts from various fields including geology, groundwater, hydrology, water regulation, environmental protection, and academia, has reviewed the Project’s technical analysis to ensure it would be safe and sustainable. The GSC considered in-depth technical analysis of four potential impact areas: springs, subsidence, air quality and water quality, as well as the Project’s operating plan and monitoring program. After completing its review in October 2011, the GSC concluded that with long-term management and monitoring, the Project could offer a significant water supply to Southern California communities without harm to the desert environment.

The GSC’s specific recommendations for monitoring and mitigation measures have beenincorporated into the project design. (The Project’s Monitoring and Mitigation plan is available at: http://www.cadizwaterproject.com/eir/downloads/Appx%20B1_%20GMMMP.pdf

Public comments and input are welcome and encouraged.

Comments on the Project should be submitted to:

Tom Barnes, ESA
626 Wilshire Boulevard Suite 1100
Los Angeles, CA 90017

Email: cadizproject@esassoc.com
Telephone: 213-599-4300

Project facilities would be constructed in two phases:

Phase 1 – Conservation and Recovery
A wellfield, comprised of existing and new wells, would be constructed on Cadiz Inc. property to actively manage the aquifer system and minimize loss of gorundwater. A 43-mile underground steel pipeline would also be constructed and buried within a privately-owned active railroad right-of-way between Cadiz and Rice, California. The pipeline will connect the wellfield to the Colorado River Aqueduct allowing for delivery throughout Southern California.

Phase 2 – Imported Storage
The Project would add capacity to the wellfield and pipeline to make available up to one million acre-feet of groundwater storage space in the aquifer system for water imported to the Project area. Recharge basins would also be constructed on Cadiz Inc. property to percolate imported water into the aquifer system. The imported water would be held in storage in the aquifer system underground using the wellfield.

The Project would provide numerous benefits for local communities throughout Southern California. According to a study published by Inland Empire economist Dr. John Husing, the Project would support over 5,900 jobs, generate more than $878 million in economic activity in the Inland Empire over its two phases, and infuse millions of dollars in tax revenue to local governments, including $5.4 million per year for San Bernardino County and approximately $613,000 per year for the Needles Unified School District.

Implementation of the Project will also improve local water supply reliability and reduce the demand for imported water from the Sacramento-San Joaquin Delta and the Colorado River, both of which continue to be limited by drought and regulatory restrictions. Such improvements could help manage Southern California’s energy demands, reduce greenhouse gas emissions, and stabilize rates for water users.