The core objective of Western Sierra Resource Corporation’s Water Resource Division is to utilize, monetize and expand its current ownership of \$40.5 million in water rights and infrastructure to the benefit of its shareholders through “beneficial use” under Colorado Water Law.
Western Sierra Resource Corporation (WSRC) owns over 4,000 acre-feet of water rights (as evidenced by Permit, Decree and Deed), near the world-class ski resort of Steamboat Springs in northwest Colorado. These rights are currently appraised at $10,000 per acre-foot, or $40.5 million in total. 4,000 acre-feet is sufficient to service between 8,000 and 12,000 dwelling units.
WSRC’s water rights may be applied to a variety of “beneficial use,” projects as defined under Colorado Water Law. WSRC’s water rights were adjudicated and approved for agriculture; residential, commercial, and industrial development; and for recreation and storage.
Each of the “beneficial uses,” categories represent opportunities for utilization, monetization, and expansion of WSRC’s Water Rights, while at the same time increasing the value per acre-foot. Water Rights in the relevant market area have been valued for between $22,000 and $33,000 per acre-foot.
WSRC’s water assets have met requirements under Colorado Water Law through historical development and use. WSRC owns two deep artesian wells, (3,086 feet and 1,300 feet deep, respectively), plus delivery and storage infrastructure – including approximately 8 miles of redundant underground 8” and 4” high pressure pipelines; as well as underground and above-ground (lake) storage. These water and infrastructure assets have been servicing 3 rural residential subdivisions and associated agricultural production (encompassing approximately 1,340 acres) for over ten years.
Having met the criteria for the development and use of water rights under Colorado Water Law, the expansion of WSRC’s water rights vis-a-vis additional beneficial uses becomes a replicable process. For example, each surface acre of land acquired for agriculture, the Company may adjudicate 2 or more acre-feet of additional water rights for beneficial (agricultural) use. Values per acre-foot may also be increased through a strategic blend of beneficial uses.
Water rights become more valuable over time and with use, especially given diminishing supplies and increasing demands in the Colorado River Basin States. In Colorado, water rights are considered real property, and are owned in perpetuity unless abandoned through declaration or by disuse over an extended period of years.
The volume of water rights WSRC may adjudicate is limited only by the amount of land WSRC can acquire and put into beneficial use. Land parcels are available in the immediate service area of WSRC’s existing water assets and infrastructure in denominations of up to 50,000 acres – much of which is available for purchase at “dry land” prices averaging $1,000 to $1500 per acre.
Beneficial Use Projects utilizing Western Sierra’s existing water rights, delivery, and storage systems includes but are not limited to: large-scale organic hay and alfalfa production; industrial hemp cultivation; organic greenhouse production; and workforce housing – for which there is a historical and established demand in the region. Putting irrigated land into production for these purposes creates three positive results: 1) production of readily marketable product at established pricing and favorable yields; and 2) irrigated acreage enables WSRC to segue into burgeoning opportunities such as industrial hemp suitable for the manufacture of pharmaceuticals, nutraceuticals, building products, textiles, bottled beverages, and hundreds of other products at much higher net revenue than is possible by production of more traditional crops. ; and 3) the opportunity for the Company to help provide sustainable, good paying jobs and affordable housing to a resort community where both have been critical issues for decades.