Parched Baja to get water supplies from Pacific Ocean

By Diane Lindquist

Growing but parched municipalities on the Baja California Peninsula are expected to receive major new supplies of water over the next few years from desalination plants that will tap the adjacent Pacific Ocean.

The projects are part of Mexico’s blueprint to establish seawater reverse-osmosis desalination plants along coasts where, according to national water authority Conagua, water availability is low while there is a high potential for development.

While desalination plants on the peninsula are planned to begin construction this year off Los Cabos and La Paz in Baja California Sur, the greatest concentration will be in Baja California. Three facilities are slated to be operating in the next few years. Yet another plant is planned off Sonora at San Carlos.

Baja California’s first such plant already is under construction near Ensenada, where residents have long been subjected to water rationing. The $48 million facility is expected to supply 5.7 million gallons daily to the port city.

A second plant — similar in scale and size to the Ensenada plant — is foreseen down the coast in the farming community of San Quintin. Growers in that region have been operating private desalination plants, more than 50 at the state administration’s count, to treat the area’s brackish well water.

The third and largest desalination plant is at Rosarito Beach. It is expected to produce up to 100 million gallons a day — twice the size of a desalination plant being built north of the border off the Carlsbad coast in San Diego County. The plant would supplement the water from the current source from the Colorado River and possibly be shipped across the border to users in San Diego.

“It looks like a very viable project,” said Roberto Vega Trevino, an attorney representing a businessman seeking to become involved in the project. “The project itself is supposed to create the largest desalination plant on the Pacific coast.”

In March, The state government, which is overseeing the public-private project, extended the bidding deadline from March 23 to April 21 to allow time for competing groups to complete the mandatory Q&A process and finalize some revisions to the regulations associated with newly instituted Asociaciones Publico Privadas (APP) public-private partnership laws.

That date, by some accounts,  remained uncertain because of a legal dispute among partners in one of the potential bidding groups.

According to the Water Desalination Report, six teams have been pre-qualified to bid on the project. They include NSC Agua/CWCO; Hydrochem (Hyflux)/CGM Services; Valorize Agua; Acciona Agua; Proactiva (Veolia); IDE Technologies; FCC Aquaria; Constructora los Potros; and Grupo Financiero Interacciones.

Several of the groups, including Valoriza, Acciona Agua, IDE Technologies and FCC Aqulia, are among the world’s top desalination plant developers.

Considered an up-and-comer, among such global developers, is Consolidated Water Co., a Cayman Islands based firm that has built and operated desalination plants and water distribution systems throughout the Caribbean. But, the company is embroiled in a legal dispute involving membership in the consortium that threatened to delay the bidding process.

San Diego resident Gough Thompson claims the partners illegally sidelined him starting in February 2012. He claims they slashed his shares in the venture from 25 percent to 0.1 percent without his knowledge or permission. At 86 years of age and just months out of double by-pass heart surgery, he wants his original shares restored. Thompson had formed consortium projects in the Middle East, where he advised U.S companies working in Saudi Arabia on desalination efforts.

“He was basically pushed aside,” his attorney, Vega Trevino, said.

Consolidated Water now controls 99.9 percent of the shares in NSC Agua, the Mexican company it formed in 2010 with Thompson and Baja businessman Alejandro de la Vega to develop the plant,

A Consolidated Water spokesperson said the company did not violate any laws, and it accuses Thompson of breaching an April 2012 agreement that included a settlement that released the NSC Agua group from future claims.

“Thompson is clearly after money and has brought these claims at a critical time expecting us to capitulate,” Consolidated Water chief executive Rick McTaggart told The San Diego Union-Tribune.

In June 2015, Thompson filed suit in Baja California courts against Consolidated Water, de la Vega and others seeking to nullify the actions that increased Consolidated’s ownership interest and demanding the suspension of transactions made at a February 2012 shareholder’s meeting that led to the diminishing of his shares.

Last fall in response, Consolidated filed suit against Thompson in New York, asking the judge to issue an injunction preventing continuation of Thompson’s Baja California lawsuit.

A initial ruling imposed a standstill to the Mexico auction until the matter is resolved. Vega, however, is seeking a reversal of that ruling. He said the stakes are high because NSC Agua is considered one of the most likely winners of the concession.

“It’s very complicated,” he said. “New York is not a proper forum to prevent Mr. Thompson from taking part.”

He said Thompson, who has spent close to $500,000 of his own money, had no interest in stopping or delaying the project.

“There is no reason for the licitation to be stopped or suspended because of litigation in the United States or Mexico,” Vega Trevino said.

As the bidding deadline approached, industry and state officials said they were uncertain whether the project would again be delayed.

The Rosarito Beach plant would be a project of unprecedented scale. It is to be located near the Comisión Federal de Electricidad power plant complex at the north end of the municipality, utilizing a relatively new concept in which the power plant can produce energy for the desalination plant while wastewater can be used to cool the power plant.

The traditional criticism of reverse-osmosis technology is that it costs too much. The process uses a great deal of energy to force salt water against polymer membranes that have pores small enough to let fresh water through while holding salt ions back. Sharing resources of the power plant complex not only addresses that issue, but also cuts power consumption and lowers the rate at which the water will be sold.

Under the licitation, the winner will build and operate the desalination plant. The estimated cost of the project is more than $500 million. The first phase is scheduled to start operating by 2019 and be fully completed by 2024. Future water rates for residential and commercial users are uncertain.

Municipalities in Baja California have come under increasing distress as water supplies have shrunk with the expansion of maquiladora and other manufacturing ventures in Tijuana, Rosarito Beach and Ensenada and of agriculture ventures in the San Quintin area.

Ensenada does not receive the Colorado River water that supplies much of northern Baja California, and its supply from acquifers has come under greater pressure from the needs of the nearby Valle de Guadalupe, Mexico’s fast-expanding wine region.

With the desalination projects getting underway, Mexico joins some 150 countries where desalination is practiced.

According to the International Desalination Association, as of June 2015, more than 300 million people in the world rely on desalinated water for some or all their daily needs. The organization put the number of plants at 18,426, which deliver 22.9 billion gallons of water a day to users across the globe.