The remote town of Nipton in the Mojave Desert has been bought by the United States’ largest publicly traded marijuana company, which will rely entirely on groundwater to develop a new cannabis-themed resort.
ON THE FARTHEST edge of California’s Mojave Desert, a tiny outpost known as Nipton has waited a century for its boom to come. First it was the promise of gold and silver riches from a handful of mining claims. Then came cattle ranching and a railroad stop on a new line between Salt Lake City and Los Angeles.
Later, Las Vegas bloomed into a tourist mecca just across the state line, and Interstate 15 was built within 10 miles of Nipton – not close enough to swing the town’s fortunes. Today, Nipton has fewer than 20 residents and is still small enough to fit into the Dodger Stadium parking lot.
Now a new moneymaker is coming to town: marijuana. In July, Arizona-based American Green, the nation’s largest publicly traded marijuana company, signed a contract to buy the entire town of Nipton, where it plans to create the first cannabis-themed resort in the United States.
American Green’s plans are an outgrowth of Proposition 64, which was approved by California voters in November 2016 to legalize the sale and cultivation of marijuana for recreational use.
The company intends to extract water from an ancient aquifer beneath Nipton to irrigate vast areas of marijuana crops and to launch a new product: cannabis-infused bottled water. It also plans to build employee housing and extensive Wild West-themed resort amenities to lure pot-lovers to the town.
“We are excited to lead the charge for a true ‘Green Rush,’” said David Gwyther, chairman and president of American Green. “This acquisition allows us to channel the myriad interests in cannabis production and consumption for an immediate positive impact to this community’s members and to cannabis consumers across the country.”
The proposal comes as California wrestles to implement another law: the Sustainable Groundwater Management Act. This requires the state’s groundwater users, for the first time, to ensure their aquifers do not suffer chronic depletion.
So American Green’s plans for Nipton raise a fundamental question: Does California want to devote its precious groundwater to helping people get high?
The question is not unique to Nipton. Desert Hot Springs, another arid community dependent on groundwater, has also thrown open its doors to the marijuana industry. But the issues are more stark in Nipton, because it is so remote and because opportunities to recharge its aquifer are even more limited.
John Izbicki, a research hydrologist with the U.S. Geological Survey who has extensively studied Mojave Desert groundwater, said the water beneath Nipton was probably deposited at least 12,000 years ago, and recharge from precipitation is likely very limited now.
“It’s a non-renewable resource within the timeframes that we manage groundwater on,” Izbicki said. “Recharge from precipitation out in the desert is effectively zero, because of the high amounts of evaporation.”
The sale of Nipton to American Green was finalized in September. A price has not been disclosed, although the 80-acre property was listed for $5 million. Gwyther declined to divulge more details about development plans for the town. But he did say the company would rely on the groundwater aquifer.
“We have access to a very large aquifer, and we’ll be using it accordingly,” he said in an interview. “If it’s 32 million gallons, and if we take a million or two, it won’t be noticed.”
Under the state’s new legislation, water users are required to ensure that their consumption of groundwater does not cause undesirable results, said Eric Garner, a prominent Los Angeles attorney and expert on groundwater law. “Undesirable” in this context can mean chronic overdraft as well as problems like land subsidence and infrastructure damage.
Garner suggested it might be hard to consider groundwater use “sustainable” if the recharge rate does not equal ongoing water withdrawals.
“Really, it just comes down to what’s the annual recharge in the basin, and what’s the demand,” he said. “I think it’s fine for there to be a net loss for the basin for a year or two – like during a drought – so long as it’s within the sustainable yield and the annual recharge covers it. What’s a problem is a long-term, chronic decline.”
It is difficult to assess the probable water demand because American Green has not yet revealed details of its project.
The company has said its initial focus at Nipton will be producing cannabis-infused bottled water using the local aquifer; the product is apparently new to the American market. Gwyther said it will initially use a non-psychoactive infusion known as CBD (cannabidiol), which has a variety of claimed health benefits. Water blended with psychoactive infusions may come later, once the company receives regulatory approval to begin growing and processing marijuana.
It plans to distribute the bottled water “throughout California,” according to a company statement, putting a potentially significant new demand on the aquifer.
Nipton also adjoins the northern border of the Mojave National Preserve. Chris Clarke, California desert program manager at the National Parks Conservation Association, is concerned that the development could harm the area’s stark desert beauty by adding large industrial buildings, growing warehouses and swathes of new housing.
“The plans that we have heard are very ambitious,” said Clarke, who lived in Nipton in 2008. “Given the attention being paid to legalization, and the novelty of the idea, this may attract a whole lot of people all at once. That does bring with it some concerns about infrastructure, sanitation and things like that.”
Nipton is one of many users of the Ivanpah Valley groundwater basin, which covers about 311 square miles straddling the state line and is divided by a large natural runoff channel called Wheaton Wash.
Details on wells in Nipton were not available. But a 2004 report by the California Department of Water Resources estimated the entire basin holds 3 million acre-feet of water. It found that groundwater levels east of Wheaton Wash – the area that includes Nipton – declined by as much as 8.5 feet between 1916 and 1984.
The DWR report also rated groundwater quality throughout the basin as “marginal to inferior” for domestic and agricultural use because of high levels of fluoride and sodium. Much of the basin’s groundwater is also very high in salts.
“It may not be the best place for a very large commercial enterprise,” Clarke said, “unless that commercial enterprise has figured out really creative ways of doing without a whole lot of water.”
Two relatively new and thirsty groundwater users have recently begun tapping the aquifer.
One is the Ivanpah Solar Electric Generating System, which began operating in 2013. The world’s largest solar thermal power plant, it uses mirrors to focus sunlight on boilers then create steam to spin turbines. The project extracts about 100 acre-feet of water per year from the aquifer, primarily to clean the mirrors. Water for the boilers is recycled.
The other is the Primm Valley Golf Club, located along Interstate 15 just north of Nipton. Opened in 1997, the club pumps groundwater to irrigate hundreds of acres of turf on two 18-hole courses, and to fill multiple ponds and other water features.
A 2009 environmental impact study for the Ivanpah solar project examined all groundwater uses in the valley. It reported that the two Primm golf courses were the region’s largest water users, consuming an estimated 1,741 acre-feet annually.
Additional solar projects proposed at the time were expected to boost demand on the aquifer by about 500 acre-feet per year. Nevertheless, the study estimated that recharge to the aquifer from runoff would still exceed withdrawals by at least 1,400 acre-feet annually.
There are caveats, however. For example, the study did not consider the effects of climate change on precipitation and evaporation in the arid region.
It also cautioned that one or two large new groundwater users – such as the golf courses – could have a regional effect on aquifer levels. But it said this might not be noticed for some time because water moves slowly through the aquifer.
Garner noted another uncertainty: Nobody knows how big marijuana production will become in California. That makes it even more difficult to judge whether the Ivanpah aquifer is a reliable source of water for marijuana production.
“It’s my understanding marijuana is a pretty water-intensive crop,” he said. “What if it becomes as ubiquitous as almonds, or something like that? I think we don’t yet know what the impacts may really be.”
Source: 420 Intel – United States