SOURCE: Consolidated Water Co. Ltd.
GEORGE TOWN, GRAND CAYMAN, CAYMAN ISLANDS--(Marketwired - May 22, 2014) - Consolidated Water Co. Ltd. (NASDAQ: CWCO) ("Consolidated Water" or "the Company"), which develops and operates seawater desalination plants and water distribution systems in areas of the world where naturally occurring supplies of potable water are scarce or nonexistent, today reported that it had completed, through its 99.9% owned Mexico subsidiary N.S.C. Agua S.A de C.V. ("NSC"), the purchase of the two parcels of land required for its proposed Mexico desalination plant.
As previously disclosed, the Company, through NSC, is pursuing a project encompassing the construction and operation of a 100 million gallon per day seawater reverse osmosis desalination plant to be located in Rosarito Beach, Baja California, Mexico and an accompanying pipeline to deliver water to the Mexican potable water system and the U.S. border. If NSC is successful in obtaining the water purchase and other agreements and approvals required and can complete the project, the Company expects to retain a minority ownership in the project and participate in the operation of the plant and pipeline system.
In 2011, NSC entered into a purchase contract with unrelated parties, pursuant to which NSC would acquire 8.1 hectares of land ("First Land Parcel") in Rosarito Beach, Mexico, which constituted a portion of the land on which the proposed plant would be constructed. In 2012, NSC obtained an extension of this purchase contract through May 15, 2014 in exchange for prepayments of (i) $500,000 paid at signing of the extension and (ii) a further $500,000 paid in May 2013. In 2013, NSC entered into a second purchase contract with unrelated parties, pursuant to which NSC would acquire an additional 12 hectares of land ("Second Land Parcel") adjacent to the First Land Parcel for $12 million, of which $2 million was paid upon execution of the second purchase contract. The First Land Parcel and Second Land Parcel constitute all of the land the Company believes will be required for the proposed plant.
On May 15, 2014, NSC completed the purchases of the First Land Parcel and the Second Land Parcel by paying the remaining balances due on these parcels of $6.98 million and $10 million, respectively.
"These land purchases represent a significant milestone in the progress of our proposed Mexico desalination project," commented Mr. Rick McTaggart, the Company's Chief Executive Officer. "We believe the site we have acquired represents the best possible location for a northern Baja, California desalination plant as it is adjacent to a pre-existing source of feed water for the plant and is of sufficient size to accommodate a 100 million gallon per day facility. The total purchase price we paid of just over $20 million for this site demonstrates our confidence in the viability of the project and our commitment to its completion."
About Consolidated Water Co. Ltd.
Consolidated Water Co. Ltd. develops and operates seawater desalination plants and water distribution systems in areas of the world where naturally occurring supplies of potable water are scarce or nonexistent. The Company operates water production and/or distribution facilities in the Cayman Islands, Belize, the British Virgin Islands, The Commonwealth of The Bahamas, and Bali, Indonesia.
Consolidated Water Co. Ltd. is headquartered in George Town, Grand Cayman, in the Cayman Islands. The Company's ordinary (common) stock is traded on the NASDAQ Global Select Market under the symbol "CWCO". Additional information on the Company is available on its website at http://www.cwco.com.
This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe", "estimate", "project", "intend", "expect", "should" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company's products and services in the marketplace, changes in its relationships with the governments of the jurisdictions in which it operates, the outcome of its negotiations with the Cayman government regarding a new license agreement for its retail operations, its ability to successfully secure contracts for water projects, including the projects under development in Baja California, Mexico and Bali, Indonesia, its ability to develop and operate such projects profitably, and its ability to manage growth and other risks detailed in the Company's periodic report filings with the Securities and Exchange Commission ("SEC").
By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.