As downtown-based Cadiz Inc. has struggled for more than a quarter century to bring water from its aquifer under the Mojave Desert to market, it has lacked a significant revenue stream to defray the millions of dollars it spends each year in fending off legal challenges and in pursuit of regulatory approvals for the water project.
But that may be changing, thanks to Cadiz’ move late last year to acquire Hollister-based ATEC Water Systems, a water-filtration company.
On March 7, Cadiz announced that ATEC was awarded a $10 million contract to provide wellhead filters to the Central Utah Water Conservancy District for use in a water-treatment plant. It’s the largest contract ATEC has received in its 40-year history.
Under the contract, ATEC will manufacture at its facilities in Hollister a total of 320 filters for the plant over the next 12 months. When it comes online, the plant is expected to deliver up to 60 million gallons of water per day of clean groundwater to central Utah communities.
“We are pleased to be supporting the Central Utah Water Conservancy District in this exciting project to make groundwater available as a reliable source for their communities,” said Scott Slater, chief executive of Cadiz and president of ATEC.
ATEC has produced water-filtration systems since 1982, when it pioneered technology to provide a cost-effective high-rate removal of iron and manganese using new types of filtration devices.
For Cadiz, revenue from the sale of these water filtration systems is a welcome addition. For years, its only source of revenue has been agricultural leases and alfalfa crop sales from its Cadiz Valley holdings in the middle of the Mojave Desert.
For the first nine months of 2022, these revenues totaled about $927,000. Meanwhile, the company spent roughly 10 times that amount on general administrative expenses.
