On September 29th, the Board of Trustees of the San Antonio Water System (“SAWS”) approved a contract with the Vista Ridge Consortium for the delivery of up to 50,000 acre-feet (“AF”) per year of groundwater from Burleson County, Texas starting in 2019. The estimated annual cost of delivered water ranges from $2,000/AF to $2,307/AF depending on the prevailing interest rate included in the calculation of the fixed cost specified in the contract. SAWS will also build interconnection infrastructure at an estimated cost of $100 million.
The Vista Ridge Consortium is a partnership between Abengoa (a Spanish-based water infrastructure company) and BlueWater Systems (an Austin-based company that assembled 3,400 leases of water rights from landowners as well as production and export permits from a local groundwater conservation district). Abengoa will build and operate well-field infrastructure, a 142-mile water pipeline and transfer facilities.
The agreement represents a long-standing SAWS objective of acquiring a non-Edwards Aquifer water supply. This supply diversification is anticipated to reduce reliance on groundwater from the Edwards Aquifer where the San Antonio Pool has been subject to frequent and increasingly severe cutbacks in allowed pumping. Supply diversification will also facilitate the objectives of the Edwards Aquifer Habitat Conservation Plan.
The next step in the project involves approval by the San Antonio City Council. SAWS anticipates seeking Council approval in October. A “Commercial Close” will occur upon contract execution after SAWS and City Council approvals. A “Financial Close” will occur once Vista Ridge secures third party project financing scheduled within 18 to 30 months. Construction is anticipated to take 42 months.
Written by Rodney T. Smith, Ph.D.