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4 UDENWLR 290 4 U. Denv. Water L. Rev. 290 (Cite as: 4 U. Denv. Water L. Rev. 290) Page 16 The Roan Creek Proposal, developed by Chevron Oil Shale Company, was substantively identical to the Galloway Proposal. Chevron proposed to construct a reservoir on Roan Creek near Grand Junction in Colorado and to lease water to Nevada pending ultimate development and use of the water for oil shale development in Colorado. The Galloway, RCG, and Roan Creek promoters sought to involve the Colorado River Basin states and to convince the states that an arrangement with private enterprise as a "facilitator" was necessary for their project to take place. The groups tried to sell the concept on an affrrmance of the entitlements to use water in the Upper Basin and on the development of a stream of revenue to use in the Upper Basin for new water project development or other state needs. The states resisted these proposals for a variety of reasons. Among other things, the states' concerns included that the concepts were legally impossible, would open an umegulated "water market" on the Colorado River, and that such an arrangement would destroy interstate comity. [FN1391 There are many reasons why an interbasin "water market" is..simply illegal under the Law of t~e River, some of which are discussed below. More fundamentally, however, it is ~... _the very id~a of a "water market" is directly contrary to the @:a,sjs,and fooodation of the Law of the RiVer. The reciprocal, historical needs of the Upper and Lower Basins, which remain valid today, are premised on the allocations embedded in the Law of the River. The Lower Basin was in need of major regulatory structures to alleviate the threat of flooding and to achieve water development opportunities. The Upper Basin sought to avoid the interstate imposition of the prior appropriation doctrine, and to protect future development rights in the Upper Basin. The *324 operational and regulatory system of the Law of the River meets these needs. .~very basis of the bargain in the Compact is the Lower, B"M'hl'sagreement that the Upper Basin has a perpetual allocation of the right to consume a given amount of water. (FN 1401 ."'exchange,the Upper Basin agreed to let pass to the Lower Basin, without charge, any water for which it lacked,a reasonably anticipated consumptive need. rFNJ41L Creating a water market in which the Upper Basin charges the Lower Basin for this water, would undermine this fundamental agreement between the Basins. Additionally, an interbasin water market violates the Compact's premise that the prior appropriation doctrine does not apply interstate on the Colorado River. Water markets, changes of water rights, and transfers are hallmarks of the prior appropriation doctrine. Therefore, an interbasin water market brings about the very result the Upper Basin negotiators of the Compact sought to avoid--making water and/or water rights an article of interstate commerce andl,a~.~ringthe Law of,~he Rivet.. with an interstate prior appropriation doctrine.' This result allows the economic and political muscle of the Lower Division States to override the future of the Upper Division States. The resuIL.&lso allows the Lower Basin to continue ecofiomic development at the expense of the Upper Basin. Therefore, it is not surprising that the concept of an interbasin water market has no basis under the Law of the River. This is true for any of the "types" of water contemplated under recently proposed marketing schemes: (1) unused apportionments of the Upper Division States; (2) water stored in the Upper Basin for later release and use in the Lower Basin; or (3) water presently consumed in the Upper Basin, the use of which would be foregone so as to allow an equivalent amount of use in the Lower Basin. J\.'summary of three of the many ways an interbasin water market is illegal unde~ Law of the River follows. 1. Interbasin Water Sales or Transfers Would Violate the Colorado River Compact A~f the Colorado River Compact specifies that the basis of the Compact is the apportionment not of water itself, bqt af4'he use-oef",~~.rFNI421 Article III(a) makes an apportionment, "in perpetuity," *325 between Upper and Lower Basins, not of water, but of the right.;,t(iJ:');!e-X'eltls.ive,.bm@fieiakconsUilRFtiN-0.<iQse." (FN1431 To reinforce this concept, Article III(d) prevents the Upper Division States from "depleting" the flow of the Colorado River at Lee Ferry below 75 m.a.f. in any ten- year running average. rFN1441 ~reover, Micle III(e) provides the Upper Basin cannot withhold unneeded water for use in the Upper Basin, if a need exists for the water in the Lower Basin. rFN1451 Once water passes Lee Ferry, and a use occurs<inthe Lower Basin, that use is chargeable as a Lower Basin use. .The <ilpIlPact does not provide an allocation of the "ownership;' of water. It guarantees to each Basin a right of use up to a specified maximum. This view is consistent with the nature of water rights as usufructuary rights, and expresses the intent of @ 2006 Thomson/West. No Claim to Orig. U.S. Govt. Works.