“After inspections I ordered, it became clear that Fondomonte has been operating in default of their lease since 2016. I’m taking action where my predecessor wouldn’t and holding Fondomonte accountable. It’s unacceptable that they have continued to pump unchecked amounts of groundwater out of our state while in clear default on their lease,” Hobbs tweeted.
In addition to canceling the Butler Valley lease held by Saudi-owned Fondomonte, Hobbs announced the state would not be renewing three additional leases that expire in February.
The cancellation of leases was a campaign promise for Hobbs, who also paused renewals and applications on other leases on state land.
Hobbs, a Democrat, also called out her Republican predecessor, former Gov. Doug Ducey, for failing to take action as Fodomonte pumped unchecked amounts of water from Arizona land.
Fondomonte, which grows alfalfa to feed dairy cows in Saudi Arabia, leased the land from the state under Ducey’s administration, paying below-market rates. According to an investigation done by the Washington Post, the state was unaware of how much water the company was pumping from beneath the ground even as Arizona faced drought conditions.
The company leased land abroad to grow water-intensive crops in order to avoid using up water supplies in the desert kingdom of Saudi Arabia. State land planners had previously objected to the leases, including the one in Butler Valley, warning the water could have better uses for the state.
Hobbs attributed the cancellation of the Butler Valley lease to Fondomonte’s failure to uphold lease terms, including failure to provide proper fuel storage. The decision not to renew the other three leases was attributed to “excessive water use.”
A spokesperson for Fondomonte denied the company had defaulted on lease terms and objected to the decision not to renew other leases, vowing to use “all avenues” to ensure there was no discrimination against the company.
Politicians and farmers on both sides of the aisle had previously raised concerns about the amount of water being used by foreign companies while Arizonans grappled with drought conditions and decreasing supplies of water.