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<br />~ <br /> <br />00 <br />~ <br />~ <br /> <br />has been constructed and is being operated by the Colorado-Ute Electric <br />Association. A potential for much greater energy production exists in <br />the area if adequate water supplies can be provided. <br /> <br />The principal economy of the area is based upon livestock pro- <br />duction and the associated growing of livestock feeds. The area is quite <br />arid and irrigation is necessary for the production of crops. Local <br />interest for the project has been very strong and persistent. <br /> <br />A major problem with the present plan of development is that the <br />project feasibility depends to a large extent upon the sale of water for <br />municipal and industrial purposes. A market for this type of water in <br />the area in the immediate future is doubtful, although such a market will <br />probably develop at some time in the future. In this respect, the project <br />faces a problem similar to that which faces the West Divide project. <br /> <br />Advance planning on the project up to this time has barely <br />progressed due to lack of funding. It is therefore recommended that <br />advance planning on the project be deferred until F.Y. 1976. For that <br />fiscal year, it is recommended that the sum of at least $200,000 be <br />sought to resume advance planning. <br /> <br />FLS:mm <br /> <br />-4- <br />