Board set to approve new well site evaluation process with shareholder participation.

On October 27, the board will consider a new, robust, and open process to produce unbiased comparisons of the best sites for our next well.  If approved, our November bills will include a letter inviting shareholders to nominate well sites and to volunteer for a Shareholder Advisory Committee (“SAC”).

The details are in a report by an Ad Hoc Committee (“AHC”) consisting of Director Alma Quezada and General Manager Robert Eranio.  They will be responsible for doing the comparative analyses, managing consultants, and writing interim and final reports; and they will select the members of the SAC.

The SAC will be asked to comment on parameters to be considered in comparing well sites.  Then it will be asked to comment on the AHC’s Working Document, which will reject clearly unsuitable sites (and explain the reasons for each rejection), and identify all sites to be evaluated further and the additional information proposed to be collected about them.  Later, the SAC will be asked to comment on a Preliminary Report and a Draft Final Report. The AHC will make revisions based on SAC input at every stage of the process.  SAC members “will be free to share information with other shareholders and collect their views at any step in the process.”

One of the stated purposes of the SAC is to “bring together shareholders holding different views in an effort to minimize those differences by exchange of information and discussion . . . with the objective of reaching as much of a consensus as possible and minimizing opposition ahead of the permitting process.”

The other main objective is to make sure “no plausible sites are overlooked . . . . [and] that the most plausible sites are fully evaluated on comparable terms (like-for-like comparison).”  There is a budget to enable the AHC to hire consultants to evaluate hydrogeological conditions and prepare rough but comparable cost estimates.

It seems clear that Well #7 at 191 Alviso will be compared—without bias for or against—to alternative locations that could pump directly to Reservoir 3 and the upper distributions zones.  (This would make it a replacement for Well #5, located next to Reservoir 3 and intended to be abandoned permanently.)  However, it appears that Well #8 and its plausible alternatives to feed Reservoir 2 and the lower distribution zone will not be considered at this time.

Crestview Watch commends the AHC for designing this excellent well site review process and urges the board to approve and support it.

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