District to formalize partnership in support of Carlsbad desal plant

SAN MARCOS, CA, Oct. 22, 2007 -- Vallecitos Water District (VWD) will officially be signing a 30-year contract signifying intent to purchase water from the Poseidon Resources desalination plant in Carlsbad as early as 2009. To help ensure successful execution of the project, Vallecitos, as well as agencies from north, east, and south San Diego County, are collectively hosting a resolution signing ceremony to introduce "The San Diego Desal Partners" on Wednesday, Oct. 24, 2007, at 10 a.m. in the Sweetwater Authority Board Room

Under this agreement, Poseidon will provide VWD with 7,500 acre-feet (one acre foot equals 325,851 gallons) annually, representing 37.5 percent of the District's total need of 20,000 acre-feet per year. The agreement was critical to VWD's Integrated Water Resources Plan -- a water source document instrumental to meeting future customer water demand.

"The District relies heavily on imported water supplies that are increasingly threatened by drought conditions and environmental regulations. Water from the Carlsbad desalination plant will provide the District's ratepayers with a drought-proof supply that helps mitigate the impact of cuts to our imported water supply," said Darrell Gentry, president of the Vallecitos Board of Directors.

Highlights of the Vallecitos Purchase Agreement include:
• Vallecitos will receive 7,500 acre-feet per year of drinking water over a 30-year period, with the unilateral option to extend the agreement for two additional 30-year terms.

• Vallecitos' price of water paid to Poseidon will not exceed that which would have been paid for the imported water supply from the San Diego County Water Authority.

• Poseidon will be responsible for all costs and risks associated with the financing, development, construction, and operation of the plant.

• The water will meet or exceed all drinking water regulatory standards under the law, and Vallecitos will never be obligated to accept or pay for water that does not meet the quantity, quality and reliability standards specified in the Agreement.

With the agreement in place, 100 percent of the desalination plant's 56,000 acre-feet-per-year capacity is now subscribed by San Diego County public water agencies.

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