Cadiz Announces Significant New Equity Financing; Proceeds Will Be Used to Reduce Debt and Advance Development of Its Water Program.

LOS ANGELES -- Cadiz Inc. (OTCBB:CDZI) ("Cadiz" or "the Company") is pleased to announce completion of a private placement in which the Company is issuing 400,000 units at $60 per unit for total consideration of $24,000,000. Each unit consists of five shares and one warrant to purchase an additional share at $15.

The Company will use approximately half of the proceeds to reduce its senior debt. The Company will then have $25,000,000 in total debt outstanding, for which the interest rate has been reduced significantly. The maturity date of the debt has been extended so that $10,000,000 will become due in 2008 and the balance will come due in 2010. The Company will use the balance of the proceeds to enhance its working capital.

Cadiz owns approximately 45,000 acres (70 square miles) of largely contiguous land in three areas in Southern California. Each of these landholdings is underlain by high-quality groundwater with natural recharge, which allows these properties to deliver water in dry years, despite regional drought conditions.

The Company's land position is enhanced by its innovative groundwater storage and supply program. This program was originally structured as a partnership between Cadiz and Metropolitan Water District of Southern California. Although the program received all necessary Federal permits in 2002, Metropolitan's Board of Directors -- by a very narrow margin -- voted not to proceed with program implementation.

This program is designed so that surplus water from the Colorado River can be stored in the aquifer system underlying the Company's land during wet years. When needed, the stored water and/or indigenous groundwater would be conveyed to the Colorado River Aqueduct for distribution to participating water agencies. Used in conjunction with surplus water from the Colorado River or other sources of supply during wet years, the Company's program would provide a new annual supply of approximately 150,000 acre-feet, enough to serve more than 1 million people.

Given the increasing scarcity of water supplies in the western United States -- exacerbated by the current drought on the Colorado River and rapid population growth -- there is a manifest need for new sources of storage and supply. Implementation of the Company's program would provide a valuable increase in water supply during periods of drought or other emergencies, as well as greater reliability and flexibility in operation of the Colorado River Aqueduct. In light of the growing need for the program, and taking into consideration issues raised during the environmental review process, the Company is now in discussions with several potential participants with regard to a new contractual structure for the program.

Richard E. Stoddard, CEO of the Company's real estate subsidiary, noted that "the Company's storage and supply program is especially valuable because it has received all major federal approvals, is located near the Colorado River Aqueduct, and will provide a firm dry-year supply to participating water agencies in times of need."

Capitalization

Concurrent with the issuance of the 2,000,000 shares of stock included within the units, described herein, the Company's senior lender has also elected to convert 99% of its outstanding Series F Preferred stock into 1,711,665 shares of common stock. Therefore, following these transactions the Company now has 10,324,339 shares of common stock outstanding.

Founded in 1983, Cadiz Inc. is a publicly held water resource management firm. The Company owns significant landholdings with substantial water resources throughout California. Further information on the Company can be obtained by visiting its corporate web site at www.cadizinc.com.

This release contains forward-looking statements that are subject to significant risks and uncertainties, including statements related to the future operating and financial performance of the Company and the financing activities of the Company. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Factors that could cause actual results or events to differ materially from those reflected in the Company's forward-looking statements include the Company's ability to maximize value for Cadiz land and water resources, the Company's ability to obtain new financing as needed, and other factors and considerations detailed in the Company's Securities and Exchange Commission filings.