This story has been updated.

Shares of Los Angeles water and land resource company Cadiz Inc. rocketed nearly 27 percent Wednesday on news of an immediate $12 million cash injection from a land lease agreement.

Cadiz announced it had signed the agreement with Water Asset Management, an investment firm with offices in New York and San Francisco. Under terms of the deal, Water Asset Management signed a 99-year lease for 2,100 acres of Cadiz land holdings in the Mojave Desert for an up-front, one-time payment of $12 million. Water Asset Management will use the land to grow crops, tapping into the aquifer underneath. Cadiz is already growing some crops on its other holdings in the area.

The companies also announced that they will enter into negotiations either for Cadiz to lease an additional 7,500 acres to Water Asset Management for a proposed price of $43 million or to have Water Asset Management provide Cadiz a credit facility of $43 million backed by the 7,500 acres of land.

The news, released mid-day Wednesday, sent Cadiz shares up 26.6 percent to close the day at $5.28.

Cadiz has been trying for nearly 25 years to develop a water storage and sales project for an aquifer under its 45,000-acre holdings in the Cadiz Valley east of the Twentynine Palms Marine Corps Air Station. Its latest plan to pump water out of the aquifer and pipe it to the Colorado River Aqueduct was dealt a major setback in October when the federal Bureau of Land Management rejected the company’s attempt to bypass a lengthy federal review process for its main pipeline. That decision, which the company has said it intends to appeal, sent Cadiz shares down 40 percent.

In the meantime, urgent financial issues loom. The company faced a $36 million debt payment in March, but in early December reached an agreement with its senior lenders to extend that to June 2017, with a $9 million payment due in March. The current and proposed agreements with Water Asset Management should enable the company to survive these immediate financial challenges.

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