CADIZ INC. ANNOUNCES WELLFIELD EXPANSION AND COMPLETION OF PIPELINE CONVERSION STUDY

Rhea-AI Summary

Cadiz Inc. (NASDAQ: CDZI/CDZIP) is set to start construction on three new groundwater wells at Cadiz Ranch in October 2022, increasing its wellfield capacity to 36,000 acre-feet per year, a 33% boost from current capacity. An engineering study for the Northern Pipeline Project, which aims to convert an existing oil and gas pipeline to transport water, is complete. This pipeline can deliver approximately 25,000 acre-feet of water uphill to Barstow and 30,000 acre-feet downhill for storage. The project aims to address water scarcity in California.

Positive

• Expansion of wellfield capacity to 36,000 acre-feet per year enhances water supply capabilities.
• Completion of the engineering study for the Northern Pipeline Project facilitates faster project execution.

Negative

• None.

Construction of three new wells at Cadiz property slated to begin Q4 2022, increasing wellfield capacity to 36,000 acre-feet  

LOS ANGELES, Sept. 21, 2022 /PRNewswire/ -- Cadiz Inc. (NASDAQ: CDZI/CDZIP) ("Cadiz", the "Company") announced today that it will begin construction of three new groundwater wells at Cadiz Ranch in October and initial engineering study for the conversion of the Company's 220-mile oil and gas pipeline to transport water ("Northern Pipeline Project") has been completed.  Once the three new wells are constructed and come online in early 2023, Cadiz will have 12 wells in operation with a total capacity of 36,000 acre-feet of water per year (AFY), a 33% increase over the current wellfield production capacity of 27,000 AFY. 

Cadiz retained global engineering firm Stantec (NYSE: STN) to conduct the engineering study for the Northern Pipeline Project. The study identifies practical off-take locations, pumping stations, cleaning, retrofitting and other improvements that will enable the pipeline to be pressurized and convey approximately 25,000 AFY of water uphill from Cadiz to Barstow on its way to the State Water Project, and approximately 30,000 AFY downhill into Cadiz for storage. 

"With so many communities desperate for water, we are urgently working to complete construction of our infrastructure and put it to beneficial use as soon as possible for people, farms, and communities in need," said Scott Slater, Chief Executive Officer of Cadiz. "With these new wells online, our wellfield will have sufficient capacity to fill our Northern Pipeline and meet the needs of our agricultural operations."

The Cadiz wellfield at the Ranch captures groundwater that would otherwise be lost to evaporation from the Mojave Desert watershed. Over three decades, Cadiz has developed sophisticated water conservation technologies to irrigate and sustainably grow commercial crops, including citrus, hemp, and grain crops, in extreme arid conditions. The Cadiz Ranch agricultural operation follows a sustainable groundwater management plan that has been administered by the County of San Bernardino since 1993.

In 2012, the Desert Research Institute conducted measurements of evaporation rates from the Bristol and Cadiz Dry Lakes located at the base of the watershed.   Based on their measurements, the combined annual evaporation is conservatively estimated to be 31,590 AFY.  In October 2012, the County of San Bernardino approved the Cadiz Water Conservation and Storage Project and an enhanced groundwater management plan that authorized the recovery of an average of 50,000 acre-feet per year for 50 years for use in California communities.

Conserved water not used for irrigation would be stored in the aquifer or transported to communities in need via two pipelines, including the 220-mile Northern Pipeline, which is already in the ground. 

"Our analysis found the Northern Pipeline can be readied for water service quickly, giving the Cadiz Water Project one of the shortest timelines to delivering new water to the region," said John Hanula, Senior Vice President, Global Major Pursuits for Stantec.

The three new wells will be built by the San Bernardino County office of Yellow Jacket Drilling Services LLC in accordance with existing permits. Cadiz will fund the construction with working capital.

About Cadiz Inc.

Founded in 1983, Cadiz Inc. (NASDAQ: CDZI) is a California business with more than 70 square miles of property, significant infrastructure, and water rights. The Company's mission is to deliver sustainable solutions to California's clean water challenges. The Cadiz Water Conservation and Storage Project is an innovative aquifer storage project that will create a new water supply for 400,000 people a year by conserving billions of gallons of renewable groundwater currently being lost to evaporation and salt contamination at Mojave Desert dry lakes. With state-of-the-art groundwater management technology, the Project will put conserved water to beneficial use and create a much-needed groundwater bank interconnecting California's existing water infrastructure. For more information, please visit the Company's website www.cadizinc.com or review the Company's filings with the Securities and Exchange Commission.

FORWARD LOOKING STATEMENT: This release contains forward-looking statements that are subject to significant risks and uncertainties, including statements related to the future operating and financial performance of the Company and the financing activities of the Company.  Although the Company believes that the expectations reflected in our forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.  Factors that could cause actual results or events to differ materially from those reflected in the Company's forward-looking statements include the Company's ability to maximize value for Cadiz land and water resources, the Company's ability to obtain new financing as needed, the receipt of additional permits for the water project and other factors and considerations detailed in the Company's Securities and Exchange Commission filings.

 

 

 

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SOURCE Cadiz Inc.

FAQ

What is the Cadiz Inc. wellfield expansion plan for 2022?

Cadiz Inc. plans to begin construction of three new groundwater wells in October 2022, increasing its wellfield capacity to 36,000 acre-feet per year.

How will the Northern Pipeline Project affect water delivery?

The Northern Pipeline Project aims to convert an existing pipeline to deliver approximately 25,000 acre-feet of water uphill to Barstow and 30,000 acre-feet downhill for storage.

What is the significance of the new wells for Cadiz Inc.?

The new wells will increase Cadiz's capacity by 33%, allowing for better water management and support for agriculture in California.

When will the new wells at Cadiz Ranch come online?

The new wells are expected to come online in early 2023.

What role does Stantec play in the Cadiz Inc. projects?

Stantec has been retained to conduct the engineering study for the Northern Pipeline Project, identifying key improvements for effective water transport.