Cardiz seeks financing for implementation of Southern California water project

Renewable resources company Cardiz is seeking of $15m financing for implementation and commencement of construction of the Cadiz Valley water conservation, recovery and storage project and other asset development programs.

The Board of Directors of the Santa Margarita water district accorded their approval for the project in July 2012.

The company is now looking to begin implementation of the project, which is expected to deliver an average of 50,000 acre-feet of water per annum through Southern California.

Existing option agreements with project participants will have to be converted into final purchase agreements, and agreements with new suppliers will need to be drawn up before the construction can start

The design will be finalised before financing is secured and contractors are invited to bid for the construction contract.

The company will also need to secure acceptance from San Bernardino county’s groundwater management, monitoring and mitigation plan and complete tie-in arrangements with the Metropolitan water district.

Legal challenges are a norm in California for projects of this scale, and the company will need to pass a range of legal hurdles; it will also look to raise capital for the project with the explicit objective of minimal dilution of current shareholder stake.

Cadiz president and general counsel Scott Slater said that the privately-funded project provides a unique, cost-effective and local water supply option that protects Southern California’s existing rate structures.

"The Project will also offer the ability to store water in periods of excess supply for use in future dry years, which is a distinctive characteristic not offered by other new supply alternatives," said Slater.

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Image: Cardiz seeks $15m for implementation and commencement of construction of the Cadiz Valley water conservation, recovery and storage project. Photo: Courtesy of Antandrus