The entrance to the Cadiz property | Photo: Chris Clarke Commentary: Just when it seems that a water grab with the shorthand name of Cadiz can't get any stranger, it can. In May, an appellate court in Orange County affirmed that a suburban water company in Orange County is the rightful municipal steward for a privately run groundwater mining operation 200 miles away in the Mojave, and that its central purpose of exporting desert water for sale to Southern California cities qualifies as conservation.
The court might as well have told us that, yes, its checked, the wolf in the bonnet is our grandmother.
If there is good news in the down-is-up and up-is-down world of what is now known as the Cadiz Valley Conservation, Recovery and Storage Project, it's that late last year, public land managers rejected the speculators' claim to exemption from federal environmental review. Adding to this, an edgy blog run by hedge fund managers argues the company is on the brink of collapse. Those bloggers say they're shorting Cadiz, market speak for betting on its collapse. In the course of what is now Cadiz's 22-year-bid for water, not a drop has been exported from the desert, but millions of dollars raised by the company still flowed back to the founder - who can now be found running the racetrack at Santa Anita Park.
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My, what sharp teeth he has. Its fitting, somehow, that for many years the public face of Cadiz was a British bon vivant with a history of hoarding politicians so compulsively that House of Cards might reject the script for a Cadiz episode as too improbable. Various accounts in the Wall Street Journal, New York Times and London Guardian have Keith Brackpool arriving in the US while still in his twenties in 1988 or 89, as head of the North American operations of a British food multinational Albert Fisher PLC. Big title, short tenure. Brackpool quit in 1992 after it was discovered that he had what the Guardian described as a multi-million dollar share in a direct competitor. It wasnt just any competitor, either, but a subsidiary of Polly Peck, Britains answer to Enron.
It was all completely innocent according to representatives for Fisher, but the CEO who sent Brackpool to the US soon lost his job and the company that had once been a profitable if modest British greengrocery firm became the very poster company for 80s overexpansion. As Fisher reversed trajectory into a decade-long plummet toward bankruptcy, its share price reportedly dropping from roughly $2 to 4 cents, Brackpool turned west, toward California, lured by rumors of an ocean of untapped groundwater roughly 180 miles east of Los Angeles in California's Mojave Desert. What one of his companys annual reports would soon describe as a mother lode of water lying in a 1,400-square-mile horseshoe-shaped mountainous catchment area known as the Cadiz Valley had already attracted speculators, but no one with Brackpools brio and recklessness.
Sure enough, NASA satellite images did suggest that water briefly pooled in the Cadiz Valley during scant winter rains. Moreover, as was long understood by hydrologists and pretty much anyone familiar with the place, the ground underneath the Mojave can indeed be full of water. Only pressure from desert aquifers keeps the Mojaves seeps and springs flowing. And these startling fonts of water in such a dry place support such an astonishing array of plants and animals that in the early 1990s, almost simultaneously as Brackpool began buying acres in the Cadiz Valley, Senator Dianne Feinstein shepherded the California Desert Protection Act through Congress and to Bill Clinton's desk. This act created the Mojave National Preserve, granting greater legal protection to the plants and animals very near Brackpools horseshoe.
Wait a second. He was growing grapes for the prince? Cadizs water right was agricultural, so Brackpool's young company began leasing a small patch of its holdings in the Mojave to citrus and table grape operation. Then, to the amazement of onlookers, it bought up the biggest ag operation in Riverside County. The New York Times described Cadizs purchase of Sun World International farms and packing operations as a mouse-swallowing-the-elephant sort of deal.
The acquisition gave him such unlikely ag-cred that, in 1999, Brackpool was in talks with a Saudi royal, Alwaleed Bin Talal, about Cadiz running a grape farm in Egypt's Nile delta. Behind lavish showmanship, however, nothing had changed from 1996, when, after the New York Times observed that Cadizs farm side lost money, Brackpool replied, The real long-term play is water.
Only the location of the Cadiz Valley, 40 miles from the Colorado River Aqueduct, made a long play plausible. To get his water to the canal operated by the Metropolitan Water District of Southern California and carrying Southern Californias municipal water supply from the Colorado River to cities such as Los Angeles, Brackpool needed two key things: A pipeline to carry water from his wells and clearance to blend that water with the rest of the water in the aqueduct.
By 2000, environmental impact reviews were in process for what had evolved on the drawing board into plans for The Cadiz Valley Groundwater Storage Project. The pump-and-dump logic of getting water out of the ground and into the So Cal municipal supply was still the heart of the project, but the scope had come to include a savings bank side. Under this, Metropolitan could wheel in any surplus it might have from the Colorado, infiltrate it into Cadiz ground where it would be safe from evaporation, then pull it out when needed. This aquifer storage and recovery side was intensely fashionable at the time, and would give the project a high conservation-value sheen as it approached environmental review.
Because Cadiz's pipeline would cross Depa
