Cadiz Inc. (“Cadiz”) announced on August 10, 2015 that the company reached a strategic alliance agreement with ATEC Systems Associates, Inc. (“ATEC”) that will allow the company to fulfill its commitment to meet California drinking water standards before water from the Cadiz Valley Water Conservation, Recovery & Storage Project (“Cadiz Water Project”) enters the Colorado River Aqueduct (“CRA”).
In the Cadiz Water Project basin, as well as many other basins in the state, the level of naturally-occurring Chromium-6 (“CR-6”) exceeds California’s 10 ppb standard. Pilot testing at the Cadiz Ranch shows that treatment technology developed by ATEC reduces CR-6 and arsenic to nearly non-detectable levels—and it also removes the iron that is added during the treatment process.
Under the strategic alliance agreement, Cadiz will help ATEC market its technology in California, Arizona, Nevada, New Mexico and Texas in exchange for 10% of the gross revenues attributable to new licenses, transfers or sales of the technology in those states.
The Cadiz Water Project is the first instance of ATEC’s systems being used to remove CR-6; though its technology has successfully been used to remove arsenic, iron, manganese, hydrogen sulfide and radium. According to a factsheet provided by Cadiz, “[ATEC’s] process is unique and consistently results in smaller footprints, smaller diameter piping, and lower costs.”
“The prevailing view within the water community is that treatment of CR-6 is both intensive and expensive. We decided to make an investment in more innovative technology and feel fortunate to have been connected with ATEC. Their technology will provide dramatic benefits at the Cadiz Water Project area and can help many other water retail agencies that are attempting to cope with still relatively new CR-6 treatment standards,” said Scott Slater, CEO of Cadiz.
Cadiz spokesperson Courtney Degener said in an interview with JOW that ATEC’s technology reduces the cost with treatment from around $400/AF to between $50 and $100/AF, making it more cost competitive with other supplies, and added that they are proud that they are able to use this innovative technology to meet their objective of delivering new water to Southern California.
Expressing a similar sentiment, SMWD General Manager Dan Ferons stated that “delivering water that meets or beats the State standard for levels of CR-6 is a key objective of the success of our public-private partnership with Cadiz and we are pleased they took the initiative to investigate alternative technologies.”
Pilot tests are continuing, but the technology will not be fully implemented until the project is a go.
The Cadiz Water Project, which is being pursued in partnership with Santa Margarita Water District, would capture and conserve groundwater from Cadiz-owned land in the eastern Mojave Desert and convey it to Southern California, providing a new supply of 50,000 AF per year.
Cadiz proposes to use Metropolitan Water District of Southern California’s (“Metropolitan”) CRA as the primary conveyance for project water. In addition to the announcement regarding the ATEC technology, several things have fallen into place over the last few months to advance use of the CRA. In June, Stratecon Inc.[1] released a report concluding that capacity in the CRA is readily and reliably available. On August 6, 2015, several local elected officials from Southern California endorsed the project, joining additional elected officials, business and labor groups, and non-governmental organizations who had previously given their support. Cadiz expects to seek approval from Metropolitan’s Board of Directors during the fourth quarter.
To minimize or avoid environmental impacts, Cadiz leased a portion of the ARZC ROW to use the existing transportation corridor for a 43-mile pipeline that will move water to the CRA. Under the terms between ARZC and Cadiz, ARZC requires that Cadiz make certain improvements that further railroad purposes, including making power available. In early June, Cadiz announced an agreement with Lucid Energy Inc. to use its LucidPipe Power System, a patented in-pipe turbine generator that will capture the energy of water moving in the gravity-flow pipeline. The ROW is now under review by the U.S. Bureau of Land Management, and certification that Cadiz’s proposed use of the ROW is within the scope of the original ROW is anticipated during the fourth quarter.
Also anticipated in the fourth quarter are oral arguments and a tentative ruling from the appellate court. In 2014, challenges to the project were rejected by an Orange County Superior Court. The appeals process has been going on this year, and the court has been fully briefed by both parties.
If all of the milestones are met by the end of the year, Cadiz anticipates that construction will begin early next year, and with an 18-month construction timeline, deliveries will begin in mid-2017.
Written by Marta L. Weismann
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[1] Stratecon Inc. is the publisher of the Journal of Water.