Logan Well Services Group is considering two sites for storage and recovery of reclaimed water. The mountain
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Logan Well Services Group is considering two sites for storage and recovery of reclaimed water. The mountain site (MS) will use injection wells that cost $4.2 million to develop and $280,000 per year for M&O costs. This site will be able to accommodate 150 million gallons per year. The valley site (VS) will involve recharge basins that cost $11 million to construct and $400,000 to operate and maintain. At this site, 890 million gallons can be injected each year. If the value of the injected water is $3.00 per 1000 gallons, which alternative, if either, should be selected according to the B/C ratio method? Use an interest rate of 8% per year and a 20-year study period.
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