Fondomonte to lose Butler Valley water rights

Fondomonte Arizona, a Saudi company that grows alfalfa for export to Saudi Arabia, is to lose water rights on all 4 of its Butler Valley leases after a move by Governor Katie Hobbs.

Hobbs announced two decisions on Monday aimed at stopping the company’s operations, whose groundwater use has become controversial in recent years at a time of drought in Arizona. The first was that the State Land Department canceled one of the company’s Butler Valley leases, and the other is that the department would not renew three others that will expire in February 2024. The department asserts that the company is in default on its lease agreements, which are on state land. The farms are located near the town of Bouse in La Paz County.

This will not affect Fondomonte’s operations in Vicksburg, also in La Paz, where its massive privately-owned alfalfa farm has generated headlines in recent years. The situation is different in Butler Valley, where the company leases publicly-owned state land. The state leases out its land to generate revenue for education and other things.

The company plans to appeal the state’s decision, saying that its use of groundwater is within the law.