Two Rivers is hoping to develop enough storage to benefit ag operations and municipalites that have water to store

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From The Pueblo Chieftain (Chris Woodka):

John McKowen, CEO of Two Rivers Water Co., says farms owned and controlled by the company will only become more valuable as Two Rivers develops storage that could also benefit municipalities. A report by the Federal Reserve Bank of Kansas City shows a 12.6 percent increase in farmland value in mountain states over the past year, and that confirms the Two Rivers business model, McKowen said. “Soaring population growth worldwide coupled with Two Rivers’ plans to develop irrigated farmland at below-market rates make this an excellent time to execute on our business model,” said John McKowen, CEO of Two Rivers Water Co., in a press release.

Two Rivers Water has purchased or controls 4,700 acres of irrigated farmland under the Huerfano-Cucharas Ditch and Orlando Reservoir system. The company expects to have 3,000 acres in production for the spring 2012 growing season.

The company also plans to redevelop Cucharas and Orlando reservoirs in Huerfano County, providing storage on both the Cucharas and Huerfano rivers. While its agriculture rights are junior, the company is able to store during winter months in order to stretch its water supply, President Gary Barber told the Colorado Water Conservation Board last week.

Here’s the release from Two Rivers Water Company via PRNewswire.com:

Two Rivers Water Company Chairman and CEO John McKowen said that a new report by the Federal Reserve Bank of Kansas City showing a 12.6% increase in mountain states farmland values over the past year confirms Two River’s unique business model that combines operating irrigated farmland with its wholesale water business. In addition, Two Rivers has enduring economic advantages inside its two river basins which allow it to solely develop high yield irrigated farmland at half the cost of comparable farmland in its operating area. The report for the Federal Reserve Bank of Kansas City can be found here

“Soaring population growth worldwide coupled with Two Rivers’ plans to develop irrigated farmland at below-market rates make this an excellent time to execute on our business model,” McKowen said. In 2011, Two Rivers Water acquired or placed under its control 4,700 gross acres of irrigated farmland and expects to have 3,000 acres in production for the spring 2012 growing season. “We’ll be planting organic corn and alfalfa which provide excellent gross revenue and profit margins in this economic environment,” McKowen said. “Yields should exceed 200+ bushels of corn or 6 ton of alfalfa per acre.”

Two Rivers also has the capability to provide water to municipalities currently suffering from water shortages in southeastern Colorado. Two Rivers controls 70,000 acre-feet of storage capacity in reservoirs and expects to develop more than 50,000 acre-feet of average annual stream diversion and aquifer production in the next 3 to 5 years. Two Rivers can support its farming operations without permanently drying up prime farmland by providing water to municipalities by fallowing its fields on a rotating basis.

In addition, McKowen noted that Americans are experiencing an accelerated debasing of the U.S. Dollar as the Federal Reserve continues policies intended to make U.S. exports more competitive in world markets. Investors can protect against US Dollar debasement and provide for good current income by investing in high quality irrigated farmland. Two Rivers provides an opportunity for investors to participate in farmland who do not have the capital or skill set to invest directly in the asset themselves.

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