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Poseidon Desal Deal? Govt. May Rescue Junk Bond Project

Poseidon Desal Deal? Govt. May Rescue Junk Bond Project

By John Earl
Surf City Voice

Due to soaring cost estimates and lack of private financing for a proposed 50-million-gallon per day Carlsbad desalination project, a government water agency may negotiate a takeover deal with the project’s developer, Poseidon Resources, Inc.

Poseidon Resources is a budding multi-national water baron that also has an identical desalination plant in the dock for Huntington Beach, next to and functionally linked with the AES power plant, on Pacific Coast Highway and Newland Avenue.

What happens in Carlsbad will indicate what could be in store for the Huntington Beach project and residents of our city as well.

The $650 million Carlsbad project would have supplied 56,000 acre feet of drinking water per year to nine of 24 San Diego County water districts under the umbrella of the San Diego County Water Authority (CWA).

But the cost of water derived from the desalination plant will be much higher than previously stated and it would take $630 million in combined public subsidy funds paid in yearly installments over 25-30 years to make the “private” project financially viable, according to a memo written by Oceanside city manager, Peter A. Weiss.

Oceanside is one of the nine water districts, known collectively as The Desal Partners, which had signed water purchasing agreements with Poseidon.

Due to Poseidon’s financing troubles and needed word changes, however, those agreements had to be revised before the project could proceed. But only one member, the city of Carlsbad, has signed a revised contract so far.

“In the past few months it has become apparent that Poseidon’s cost of water is going to be greater than originally proposed,” the memo states. “To make the project viable, Poseidon needs subsidies from the San Diego County Water Authority and Metropolitan Water District (MWD)”, the memo continues.

The CWD is a member of the MWD, which supplies water to 26 southern California water agencies.

5 Responses to “Poseidon Desal Deal? Govt. May Rescue Junk Bond Project”

  1. Milt Dardis says:

    Many of the Huntington Beach taxpayers have questions regarding Poseidon Resources. This is not a multinational corporation with thousands of employees as they portray themselves to be. In fact, you have a fiduciary responsibility to the Huntington Beach Taxpayers and its citizens to do the necessary Due Diligence on Poseidon Resources.
    • The NAICS Code/ SIC Code is 541612 which represents a Consulting Service not a Developer and Contractor to build a Desalination Plant
    • What is the Headcount for Poseidon Resources? You will find its less than 75 people and more likely the FTE is 20 to 50

    Why did the spokesperson for Poseidon Resources disappear after getting the 4 person Councilman vote for approval? Where is Billy Owens today after the selling job he did.
    Why did the Poseidon Resources Technical VP quit the company?

    Now we question Credit Worthiness and Financial Liquidity with a Positive Tangible Net Worth. Notice we used “Tangible.”
    • We the taxpayers want to know what the capitalization and Tangible Net Worth of a company is before you give them free reins to the City Treasury.
    • Why did the first two contractors that were selected by Poseidon Resources go bankrupt during the construction of the Tampa Bay Desal Plant.
    • Why did the Tampa Bay plant open 5 years late with a cost overrun of $40M.
    • The Tampa Bay plant has not met its target of producing 25 million gallons per day as originally promised by Poseidon Resources
    • This is a “red flag” waving since Poseidon Resources was responsible. These are just simple examples that should be explored and validated.
    • With tangible evidence what bonding will be give to the city of Huntington Beach by Poseidon Resources.
    • If you do business with a corporation that has a deficit Net Worth, then you have no legal recourse.
    These are several facts that the HB Political Machine continues to ignore as their arrogance is that we are right and you the taxpayers are wrong. Do not Worry for we are in charge and we are right.
    Milt Dardis
    Ethics: We have no Stinking Ethics

    • admin says:

      Thank you for your comments. One slight correction, however, if I may. Poseidon Resources is, in fact, a multi-national corporation by definition, which is something that they have tried to deny because of its implications with the Coastal Commission staff analysis. Approving Poseidon could have international treaty implications that would hamstring local, state, or U.S. regulators and possible require other desal plants to be private as well.

Trackbacks/Pingbacks

  1. […] into the 21st Century, plans to build ocean desalination plants where proposed for the cities of Carlsbad and Huntington Beach. Most of the permitting process has been completed for both plants but huge financial obstacles […]

  2. […] From the latest in the financing debacle at Poseidon Resources: […]


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