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<FILENAME>exh_99-1.txt
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                                                          EXHIBIT 99.1


December 20, 2007



Dear Shareholder,

As we approach the end of the year we thought it would be helpful
to provide an update on the Company's progress.

Over the last few years we have told you that California, and in
particular, Southern California, is facing a looming crisis due
to its rapidly diminishing water supply.  There is now no doubt
that Californians will remember the year 2007 as the year when
there was finally widespread agreement as to the magnitude of the
water supply crisis.

A combination of ongoing drought, judicial decisions that have
significantly and permanently curtailed once firm sources of
supply from Northern California, a reallocation of Colorado River
supplies, and radical increases in the cost of procuring new or
replacement supplies, have finally given California's water
supply problems the attention they deserve.  Indeed, the state's
water supply issue is now so critical that the Governor of
California recently called an emergency session of the
Legislature to propose a $10+ billion Bond issue to fund possible
solutions.  His quote below was telling:

     "Whether it's the drought, reduced pumping through the
     Delta, or our half-empty reservoirs, everyone now can see
     that we haven't done enough to protect California's water
     future.  `A nation that fails to plan intelligently for the
     development and protection of its precious waters will be
     condemned to wither because of its shortsightedness,' Lyndon
     Johnson once said.  I want to make sure that never happens
     in California." -- GOVERNOR ARNOLD SCHWARZENEGGER, 11/13/07

At the time of this letter the legislature is still debating the
exact terms of the proposed Bond measure.  In the meantime,
several cities in Southern California have declared mandatory
reductions in supply to their customers and many more have
publicly stated they intend to do so in the early part of the New
Year. Other agencies are considering tiered pricing for consumers
who wish to continue their previous amount of consumption.  Such
tiered pricing will allow for some reduction in demand and,
importantly, provide the agencies a funding mechanism for which
to procure the new, much more expensive sources of supply.

Even with billions of dollars available from the bond measure, it
is interesting to note that few, if any, of the alternatives
being considered for funding involve new water sources for
critical dry years, as the Cadiz Groundwater Storage and Supply
Program could offer. The flexibility of the Cadiz Program is what
makes it uniquely valuable.  As you know, the Cadiz Program is
not only a large groundwater storage program, but it also has the
capacity to deliver significant amounts of water in dry years.
With large municipal water agencies now telling their customers
that `dry is the new normal', we believe that the time has
arrived to enter into long term storage and supply agreements
with agencies whose vision of the future causes them to look
beyond existing water supply solutions. In this regard, we are
now discussing the type of long term financial arrangements that
would allow these agencies the ability to utilize both the
groundwater storage aspect of the Program and the dry year supply
option, while still protecting the environment and critical
resources.

Environmental groups have long favored underground storage as
preferable to surface storage.  What has kept them from endorsing
any specific groundwater storage project has been the lack of any
long-term study of the impacts of such projects on the
environment.  The Cadiz Program, which includes an extensive
Groundwater Monitoring and Management Plan, would provide such
long-term study and protection of the region's many resources.
Indeed, in 2001, the Federal Government convened multiple
agencies including the U.S.Geological Survey, the National Parks
Service, the County of San Bernardino and the Metropolitan Water
District of Southern California and designed the comprehensive
Management Plan to assure protection and monitoring of the
resources in one of the most extensive areas ever in California.
The Federal Government in 2002 issued a press release to
accompany the approval of the Management Plan that reiterated its
confidence in the Plan's ability to protect the environment:

      "We believe that the (Cadiz) Management Plan, which is
     based on science and a strong monitoring program, will
     assure the necessary protection of the natural resources for
     which we are responsible."  -- REBECCA WATSON, ASSISTANT
     SECRETARY FOR LAND AND MINERALS MANAGEMENT, U.S. DEPARTMENT
     OF THE INTERIOR, 8/29/02

As we have reported over the last few years, Senator Dianne
Feinstein (D-CA) has voiced opposition to the Program based on
her concerns about the Program's impact on the local environment.
To reiterate her continuing opposition, she has included language
in the 2008 Federal Omnibus Appropriations Bill, now being
finalized by Congress, to prohibit the U.S. Bureau of Land
Management (BLM) from expending any funds in the review of
groundwater storage programs in areas managed by BLM's Needles
field office. Our Program would appear to be the target of this
language as it is located within this jurisdiction. In practical
terms, the Bill only covers spending through September 2008 and
we do not anticipate filing any new applications with the BLM in
that time period.  However, we take the Senator's concerns very
seriously and we plan to continue to work with the Senator's
office to resolve any questions or concerns she may have about
the mechanics of the Management Plan or the Program itself in the
coming year.

As previously reported during the year, we are continuing to
press our claims against the Metropolitan Water District of
Southern California for its failure to complete the entitlement
work for the Cadiz Program in 2002. A trial on that matter is
scheduled to be heard in the spring.

We are also fortunate to be well positioned financially as we
enter the New Year.  The Company has no short-term debt and more
than sufficient cash on hand to actively pursue our goals. We
recognize that development of assets of this nature do take a
considerable amount of time.  However, for all the reasons
outlined in this letter we believe the extraordinary value of our
asset will soon be realized.

As we approach 2008, we continue to believe that the Company is
very well positioned to structure the appropriate and necessary
long term arrangements for the Cadiz Program.  We believe these
arrangements will benefit shareholders while providing an
environmentally sound, new source of water supply for the State
of California.  We look forward to success in these endeavors.

As always, if you have any questions, please contact our Investor
Relations Manager, Courtney Degener, at 213-271-1600. We wish you
a happy and healthy holiday season and all the best in 2008.

Sincerely,
Keith Brackpool
Chairman and Chief Executive Officer
Cadiz Inc.




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