Water Resources to Supply Desalinated Water to Municipality of Santa Catarina in the Cape Verde Islands

PERTH, Australia, Aug. 23, 2011 /PRNewswire/ -- Water Resources Group Ltd (ASX: WRG: US: OTC-WTRSY) is pleased to announce its Joint Venture Company, Blue Aquifer LDA, has been selected to supply potable water to the Municipality of Santa Catarina in the Republic of Cape Verde, an Island Nation 570 km off the coast of Western Africa.

A Letter of Intent has been signed by the President of the Municipal Council of Santa Catarina and calls for 4,000 cubic metres per day as an initial requirement.

The President, Francisco Fernandes Tavares said; "I'm pleased to inform you that Blue Aquifer is our preferred supplier of potable desalinated sea water for this project and, assuming that commercially reasonable terms and a competitive price can be agreed, we intend to enter into a 25 year contract."

Blue Aquifer which is 49% owned by the Water Resources Group (WRG) will manage and operate the plant. All equipment and systems will be supplied by WRG for a total sale price of approximately US$10 million. WRG will also earn 49% of the water sales for the 25 year contract term.

The Municipality of Santa Catarina requires water to be supplied by September 2012 and WRG expects to enter into formal agreements by October 2011.

WRG is also pleased to announce the completion of the Joint Venture Agreement with the 51% shareholders of Blue Aquifer. One of these shareholders is Loid Engineering, a well known engineering firm in this region.

The CEO of WRG, Brian Harcourt said, "We are very pleased to have concluded this Joint Venture Agreement which has attracted the Santa Catarina project. We believe that in the near future other municipalities in the Cape Verde Islands will take advantage of our low cost, chemical free, community based desalination systems and Blue Aquifer is well placed to supply this market."

Mr. Harcourt, who has just returned to Australia from North Africa, also advised "Our Moroccan contract is nearing completion and we are aiming to start construction of both Cape Verde and the Moroccan installations by the end of this year. These plants when commenced will generate over US$2 million per month in revenue for the Company starting in early 2012 and should be a catalyst for the establishment of additional projects."

SOURCE Water Resources Group Ltd