Jicarilla Apache Tribe, New Mexico

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Public Service Company of New Mexico is negotiating a water contract with the tribe worth nearly $1 million a year. PNM would use the water for mine reclamation, steam and cooling systems. It began negotiating after the Jicarillas secured 40,000 acre-feet as part of a federal water rights. Since 1980, PNM has leased 16,200 acre-feet of water annually from the Bureau of Reclamation. That contract, which guarantees a rate of $9 per acre-foot, expires in 2005. It did not include a price escalation clause, so the price - about $145,000 a year - remained the same the last 25 years. However, since 1980, the market rate for water has risen to an average of $60 an acre-foot, a spokesman said, or about $972,000. "PNM expects to negotiate a contract (with the Jicarillas) in that range." Any contract would have to be approved by the tribal council. The water is diverted from the San Juan River. The company had planned to lease water from the bureau again, but the spokesman said concerns over unresolved Navajo Nation water rights on the San Juan have held up negotiations since 1993. The U.S. Fish and Wildlife Service also will review whether the contract is in line with the Endangered Species Act.