Vidler Water Co. and Lincoln County Water District Enter Into Agreements to Sell Water

November 15, 2005

PICO Holdings, Inc. announced that its wholly-owned subsidiary, Vidler Water Co., and the Lincoln County Water District (Lincoln/Vidler) have entered into two new agreements to supply water to a planned community in Lincoln County, Nev.

Lincoln/Vidler have agreed to sell 560.06 ac-ft of water for approximately $3.4 million, or a price of $6,050 per ac-ft of water. The purchaser is Coyote Springs Investment LLC (CSI), the developer of a planned community commonly known as Coyote Springs, to be located partially within Lincoln County, Nev. and partially within Clark County, Nev. The water rights are the subject of an existing protest, and escrow will close within 15 days of the protest being resolved.

Lincoln/Vidler have also agreed to sell additional water to CSI, as and when supplies are permitted from existing applications in Kane Springs Basin, Nev. The applications are for up to 17,375 ac-ft of water, although the actual permits received may be for a lesser quantity. It is anticipated that the applications will be heard in 2006, and that it could take up to 12 months after the hearing for the application to be permitted and the sale closed. The initial purchase price for the water will be $6,050 per ac-ft for the first year of the agreement. The price of unpurchased water will increase 10% each year on the anniversary of the agreement.

Source:

PICO Holdings, Inc.

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