Saudi-owned farm in La Paz County denied plan for new wells

The state of Arizona has denied plans for two new deepwater wells requested by a farming operation in La Paz County owned by a Saudi Arabian dairy company.

Fondomonte Arizona already pumps enough groundwater to irrigate thousands of acres of land near Vicksburg, a 46-mile drive from Parker, where it uses it to grow alfalfa for export back to Saudi Arabia as dairy cow feed.

But the state approved two new deepwater wells for the company’s leased land in Butler Valley last August, according to Arizona Attorney General Kris Mayes, who criticized the operation during her campaign last year. Mayes said that her office has now found inconsistencies in the applications for the new wells, bringing the information to the state land department, which agreed to block their approval. The inconsistencies reportedly included listing different landowners and conflicting information about whether the wells were new or replacements.

“Pumps are pumping water out of the ground that belongs to the state of Arizona, and essentially it’s being exported to Saudi Arabia,” Mayes told CBS News. “In one day the amount of water pumping out of just one of those wells could serve roughly 30,000 Arizona residents, which is pretty astonishing given that the entire population of La Paz County has just over 16,000 people,” she told The Arizona Republic.

“Kris Mayes has been amazing on this,” said La Paz County District 3 Supervisor Holly Irwin, who has been a vocal critic of the arrangements for almost a decade. “She had reached out to me about these leases, she’s driven out here a few times, and she thinks we need to cancel the leases. With all water issues facing us, you would think it would be common sense that we just do not approve any new permits until we find out properly what’s underneath the ground.”

Irwin added that she thinks the legislature should act.

“Being that we’re in a drought and have been for quite some time, the normal way of dealing with our groundwater isn’t serving us anymore,” she told Parker Live. “I don’t understand why it’s so hard for the legislature to grapple with this. If we don’t change something now, we’ll have no water.”

The severity of the southwest’s drought problem over the past few years has shone a light on the generous water rights that come with these rural Arizona lands. In much of the state, especially the cities, groundwater is actively managed with restrictions over how much can be pumped. But in rural La Paz County, there are no such restrictions, which is what attracted Fondomonte in the first place.

Fondomonte is a wholly owned subsidiary of the multi-billion dollar Saudi dairy company Almarai, one of the largest dairy providers in the Persian Gulf region. In the early-2010s, Saudi Arabia realized it had a water crisis, and the kingdom announced it would stop growing water-intensive crops like alfalfa, forcing Almarai to look elsewhere for its dairy feed and allowing the Saudis to conserve their own water supply.

“The reason Fondomonte is here is because they’ve depleted their own natural resource over there,” Irwin said. “They basically said, we’re not going to allow you to grow any more alfalfa over here, so go find another place to do it. Well, they land here because there’s no restrictions, and they can ship it back to a foreign country. It’s bizarre that our country is even allowing this to happen.”

Fondomonte started operations in La Paz County after purchasing just under 10,000 acres of land for $47.5 million in Vicksburg in 2014. It also bought up a tract in California’s Palo Verde Valley and has, according to CBS, the rights to farm around 6,000 acres of state-owned land in Butler Valley, leases that are signed by the State Land Department.

These purchases and leases allowed the Saudis to take advantage of the farm-friendly water laws in the region. The groundwater rights that came with the land had no restrictions associated with them, meaning the company could use up as much water as the wells could pump and send the resulting crop wherever it wanted. The news provoked outrage in a population all too aware of the water crisis of the past few years, as the drought-stricken Colorado River has edged toward disaster.

“Right now it’s just a free-for-all,” Irwin said. “If we don’t start regulating what’s coming out of the ground, we’re in trouble.”

Irwin added that she thought the State Land Department owed La Paz County for the leases.

“The ones in Butler Valley are state land leased to the Saudis for a discounted rate,” she said. “Any state land leased within our county, we’re supposed to receive funding from that for our school districts. And so I have literally requested the AG to investigate these land leases and I’ve requested compensation for that discount to our school districts.”

Defenders of the arrangement point to Arizona Department of Water Resources maps which show well levels on the Fondomonte land have risen since they owned it, and say the company uses some of the most advanced water conservation methods. The arrangement isn’t unique either. In 2021, nearly 20 percent of alfalfa produced in the west was exported to other countries, according to USDA data. Some say that living in the modern world is to embrace a global food economy. In addition, there is a need for high quality livestock feed even within the United States, with alfalfa farmers saying it has to be grown somewhere.

But, at a time when there isn’t enough water to go around, Attorney General Mayes says she thinks the state should not only refuse new well applications but decline to renew the existing ones when they come up next year as well.