Saudi-owned company stops pumping Arizona groundwater on some La Paz County leases
Gov. Katie Hobbs' office on Thursday announced the Saudi-owned company Fondomonte is "officially no longer pumping Arizona groundwater in Butler Valley," in the western side of the state.
"After a recent inspection, the State Land Department has confirmed that as of February 15, 2024, Fondomonte is no longer irrigating on any of its Butler Valley leases," said a media release from Hobbs' office. "Visual inspections also confirmed Fondomonte has begun taking steps to vacate the property."
But the Butler Valley Basin leases represent roughly one-third of Fondomonte's holdings in La Paz County that AZPM located.
Fondomonte, a subsidiary of Saudi dairy giant Almarai Co., held four separate lease agreements in the Butler Valley Basin to grow alfalfa that feeds livestock in the Gulf kingdom. In October, Arizona's State Land Department notified Fondomonte that three of its four leases in the Butler Valley Basin would not be renewed. Fondomonte was simultaneously notified that the fourth lease would be canceled as well.
The Arizona governor’s office said the State Land Department decided not to renew the leases the company had in Butler Valley due to the “excessive amounts of water being pumped from the land — free of charge.”
Fondomonte appealed the cancellation, and that process is still pending. The last lease ended on Feb. 14.
Concern over Fondomonte's holdings in Arizona crept up after media reports that the company was growing alfalfa on the land for export to Saudi Arabia, where it fed livestock.
Current Arizona regulations allow virtually unfettered groundwater pumping in the state's rural areas.
Climate-challenged countries like Saudi Arabia have increasingly looked to faraway places like Arizona for the water and land to grow forage for livestock and commodities such as wheat for domestic use and export.
Foreign and out-of-state U.S. farms are not banned from farming in Arizona nor from selling their goods worldwide. American farmers commonly export forage crops to countries including Saudi Arabia and China.
Another company, the United Arab Emirates-owned Al Dahra ACX Global Inc., grows forage crops in California and Arizona, including on Butler Valley land it leases from a private North Carolina-based company. It is a major North American exporter of hay.
Hobbs took credit for the end of Fondomonte's operation in the valley.
“I’m not afraid to hold people accountable, maximize value for the state land trust, and protect Arizona’s water security," she said.
