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Long Term Water Leasing

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Leasing is a long-term formal arrangement that can be used to secure access to water entitlement for a specified period of time.
Water entitlements can be leased to receive the seasonal determinations and/or to access carryover capacity and in different trading zones. We assist entitlement owners (Lessor) to maintain their entitlement and trade their water allocation water to irrigators (Lessee) needing to secure water requirements, beyond their own water.

We provide ‘Long Term Lease’ offering long term entitlement security whilst guaranteeing a return to water entitlement owners. We can manage your lease agreements, allowing you to secure water in advance for a number of years at a known cost. If you are an entitlement holder, it will lock in an income for a number of years.

Learn more about Long Term Leasing

What is Long Term Leasing?

A lease of water is similar to the lease of land in the terms that it is an agreement between two parties to lease an agreed parcel for a price and a term. In comparison to the temporary market, long term leasing allows you to lock in a guaranteed price for a fixed term, rather than being exposed to fluctuations in price on the spot market.

How does Long Term Leasing work?

The Lessee receives complete access to the entitlement for the duration of the lease, assumes all risks associated with seasonal allocations. Additionally, the Lessee pays an amount per ML of entitlement per annum regardless of what the seasonal allocations are.

i.e., If a Lessee has leased 100ML of water entitlement for $200 per ML per annum, the price will be $200 per ML regardless of whether the entitlement receives 100% seasonal allocations or 20%.

The seasonal allocations and carryover functionality associated with the entitlement is granted to the Lessee in exchange for paying a fee to the Lessor and all outgoings associated with the entitlement.

What is the Process?

Leases should all be established through a contractual arrangement which clearly specifies the rights and obligations of each party, the lease fees and the payment terms.

In addition to the contract, application forms need to be submitted to the relevant water authority to formalise the arrangement. The time to establish a formal lease depends on the jurisdiction however it generally takes a minimum of 4 weeks.

Why Would I Want to Lease Water?

With the continual increase in value of Water Entitlements, water users are looking for alternative ways to lock in their water requirements, aside from holding the entitlement themselves due to the high capital requirements.

As a lessor – you get a guaranteed return for a fixed term. You also still own the entitlement, but you don’t have the rights to use it.

As a lessee – you can secure water, long-term for a known price.

Contact one of our experienced consultants and learn how our online Water Market 24/7 can benefit your business today.

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