Saudi water deal threatening water supply in Phoenix

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Arizona is leasing farmland to a Saudi water company, straining aquifers, and threatening future water supply in Phoenix. Fondomonte, a Saudi company, exports the alfalfa to feed its cows in the Middle East. The country has practically exhausted its own underground aquifers there. In Arizona, Fondomonte can pump as much water as it wants at no cost.

Groundwater is unregulated in most rural areas of the state. Fondomonte pays only $25 per acre annually. The State Land Department says the market rate is $50 dollars per acre and it provides a 50% discount because it doesn’t pay for improvements. But the $25 per acre price is about one-sixth of the market price for unimproved farmland with flood irrigation today, according to Charlie Havranek, a Realtor at Southwest Land Associates.

Although there are no records for how much Fondomonte is pumping out of the aquifer, a State Land Department report estimates the company is swallowing as much as 18,000 acre-feet every year – enough water to supply 54,000 single-family homes.

Using the average rate at which groundwater on state trust land is auctioned – as the report suggests — the value of the water Fondomonte uses could be anywhere from $3 million to $3.9 million a year.

Here’s what Rob O’Dell had to say:

One of the things being grown on the farmland is alfalfa, which is being sent back to Saudi Arabia to feed their cows. However, alfalfa can be very water intensive, which is being supplied by the ground water coming from western Arizona.

“It’s one of the most water intensive crops there are, and just with the conditions out there, they’re able to do eight to nine cuts, harvests a year of alfalfa,” reports Rob O’Dell, a reporter at The Arizona Republic.

A side note as to why: Saudi Arabia has exhausted a lot of their ground water supply. A lot of companies in Saudi Arabia have been searching around the world for a location to get their water from, and one of them is western Arizona.

Is this ground water actually from western Arizona?

“Absolutely. This is ground water that was laid down probably 70,000 to 80,000 years ago; that’s almost nonrenewable.”

As for the leases for the land, both of them were conducted by the State Land Department. One of the farms is located in Vicksburg, and the other is in Butler Valley.

How much are these leases?

“They pay about $86,000 a year. Some reports show that the water could be worth up to $3 to $4 million dollars a year that they are putting on the field every year,” said O’Dell, who went on to say this about Phoenix and their water supply: “That could be a potential water supply for Phoenix.”

Edited for formatting July 2023

Rob O'Dell, reporter for The Arizona Republic

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