99 Costa Rica Water concession, wells, springs and rivers

[Richard Bexon]

Good morning, Jorge. How are you doing?

[Jorge Matarrita]

Thank you very much, Richard.

[Richard Bexon]

It's an absolute pleasure to have you on the podcast, especially someone with so much knowledge about water, and I'm interested to find out even more deeper what a hydrologist does as well.

[Jorge Matarrita]

No, no. Thanks to you. As I say, I'm a fan of your podcast, I'm Costa Rican, but I listen to it because, you know, I work with many people, many business people, expats, and, you know, your podcast, I thought it's very accurate for the Costa Rican reality.

So congratulations for that. Thank you very much.

[Richard Bexon]

Thank you. Thank you. Well, as I said, it's a pleasure to have you on here.

You are Costa Rican yourself. I mean, the last two and a half years, I suppose it's two and a half years now, it's been pretty crazy here in the pandemic, but I mean, what has surprised you specifically in the last six months and what trends do you think are here to stay or to hit?

[Jorge Matarrita]

Yeah. Thank you. Well, I would like to say something about really general, that surprised me in the last six months, despite the presidential shift in the politics in Costa Rica, and despite the global pandemic, despite the Russian Ukrainian war, the global inflation, the growing instability in the countries in Latin America, like Colombia, Peru, Honduras, despite all that surrounding Costa Rica, it is still in peace and very stable and it's open for business, business as usual. Fantastic.

[Richard Bexon]

Fantastic. Well, I mean, Jorge, maybe you can explain what a hydrogeologist does, if you don't mind me asking, as, you know, I mean, a lot of us listening here, even myself would like to know a little bit further about what you do.

[Jorge Matarrita]

Okay. Okay. Great.

Well, yeah, I studied at first geography, like digital cartography, remote sensing and geographic information systems. But then I studied a master's in hydrogeology, which is the understanding of the aquifers, of the groundwater. So I studied at first in Costa Rica, then in Germany, a little bit in Brazil and so on.

But all around the world is about the same. The water that sits below the surface. And the problem is that not too many people get to understand because you cannot see it.

So there has to be a lot of equipment and technical methodology to understand the aquifer system. Because it's so important from the aquifers, we get the springs, the natural springs, the water springs, they're not superficial water from the rain. They come from down the earth into the surface.

So Nacientes or natural springs, those are groundwater. And for drilling wells or dogging wells by hand, it's also about groundwater. Recharge from the surface water, interaction between rivers, that's also groundwater.

And one word is hydrogeology. In general, it's more like water resources management, because we have to see and think many things. But it's about the same everywhere, as I say.

[Richard Bexon]

Well, I mean, water is very important in this country. I mean, we do have an abundance of it. But a few years back, the laws changed.

But also is the availability of water to get a registered water source, whether that be the AYAN or SADA, whether you dig a well off a river. I've even heard of people attempting to get water letters off rain capture, which is not an easy thing to do. I know local municipalities aren't a big fan of it.

But I mean, what services are you offering to people? I mean, what are you typically, what projects are you working on? Just so that anyone listening here can have an idea of like, oh, that's what I would use Jorge for.

[Jorge Matarrita]

OK, thank you. Well, the most and most urgent projects in the moment is the due diligence. Yeah.

When investors are going to buy a property, they have to, you know, make a due diligence and know everything about the property before buying it. Because once you buy it, there is a big problem. So usually in Costa Rica, there is a lot of rivers.

There is a lot of rain. Of course, we're tropical. There is a lot of mountains.

And the interaction between surficial water, rainwater and the rivers and the groundwater from the aquifers is it's very fussy. Not many people know about that, but there is laws about it and you have to make setbacks or protection zones. So when, let's say, an expat or somebody from Europe wants to buy a property here, usually they do their due diligence through a lawyer, but also through a topographer.

And those people are going to be the first ones to see, oh, I think you got some sun water in your property. So right now, the water is not really about getting the water, potable water, but mostly about the setbacks and protection zones that are caught in the areas of buildable areas.

[Richard Bexon]

So you're talking about like an in-booth study for setbacks on rivers, etc.? Exactly.

[Jorge Matarrita]

The thing is that if you go to the government, they take so long and there are so many institutions to know that setback. So we want to do it in just like two or three weeks. And so I go there, I fly a drone, I make a map, I see where the forest is, where the rivers are, where the springs.

Is that a real spring or is that maybe a seasonal spring? Because if you have a permanent spring, water spring, it's a 100-meter setback. So we buy your property.

But if we can make sure, if we can scientifically say that that spring is seasonal, then it's only a 60-meter setback.

[Richard Bexon]

OK, but could you also get a, I mean, theoretically, if you had a large piece of land that did have a spring on it, could you get a concession on that spring for water for your property?

[Jorge Matarrita]

Oh, yes, yes, of course.

[Richard Bexon]

Yeah.

[Jorge Matarrita]

OK, so so there are many, there are three ways, let's say, or three areas to get the water level, water later. The first one, if you're in urban areas, the urban areas usually have an aqueduct like AYA or in Heredia, the SPH, and other medium towns or cities are the municipalities. In rural towns, then we got the azadas.

The azadas is the rural aqueducts owned by the neighbors and the surrounders of that place. But there are some properties or some places there is no aqueduct, no institution, no nothing. Just the forest and the wild.

It may be people like that, but there's no water. And you can have maybe a spring water that you can have a concession or maybe you have a river going through your property. Or if you have an aquifer down there, then you can drill a well for to get the water for your property.

[Richard Bexon]

So, OK, well, let's talk about drilling wells, because typically there are two different types of wells here, right? There's an artisanal well and there's a perforated well. I mean, what is the difference between the two?

What is the process? What is the cost? I mean, you know, if somebody is looking at a piece of land that does not have, you know, a registered water source and they want to put their own well on the property.

I mean, what are those two different types of wells and how much is the cost and the time frame to get them?

[Jorge Matarrita]

OK, yeah, well, the pozo artesanal, which is a well dug by hand, crafted, it requires no permission at all. So you can do it right away. But it's only the law says it's only specific for one house.

So you cannot have it pozo artesanal or a well dug by hand for a condominium, let's say, or something like that, because there is not going to be enough water in quality and quantity from that shallow dug by hand well. In the other hand, then we got the drilled by machines wells. Those are the modern wells that you need to have a permission to get there.

And it takes about one to two years to get the permission to get the concession. It has a 40 meter setback of protection zone as diameter and has very low vulnerability to pollution, because usually those are like 60 meters, 100 meters deep. So it has lower risk of natural hazards like climate change or pollution by the humans.

[Richard Bexon]

OK, well, so for an artisanal well, but you're going to need to request a concession on that well in order to get the building permit.

[Jorge Matarrita]

Not really a concession, but a saying that you have your art, your pozo artesanal in your property and that you are going to use it. Yeah, but the government won't say a thing, but it's true. You do need the governmental paper or I'm totally saying that you do have an artesanal well so that you get your permissions at the municipality.

Otherwise, they won't give you.

[Richard Bexon]

And I mean, how much does an artesanal well, because I would say the majority of people looking to listening to this podcast and maybe looking to build a home, you know, or they have a larger piece of land they want to subdivide. And you can put an artesanal well on potentially all of these, you know, these bits of land that you have. But I mean, how much does an artesanal well cost to dig?

[Jorge Matarrita]

Well, it's very it is like maybe four thousand, three thousand dollars, depending on how deep they have to go, how shallow the water level is. For example, if you are at a beach property, at the beachfront, then usually the water will be there like 30 centimeters or one meter below the surface. So it will be like an easy well.

But if you live up a little up in the mountains, like in Santa Teresa mountains or somewhere where there's no aqueduct that you need to drill an artesanal well, because maybe it's forbidden to drill a machinery well, then you have to go and pay a little more. It's by meter or by time. But those won't be much expensive than four thousand, five thousand dollars.

[Richard Bexon]

So I mean, an artesanal well will probably cost four or five a perforated well. What are you looking, twenty to thirty thousand dollars?

[Jorge Matarrita]

OK, for a drilled well, the price has changed depending on what you want for your property. So it depends on the diameter of the perforation and the equipment you're going to need. But roughly for a house, a 60 meter well drilled by machinery and with all the trimets will be probably around 30 to 40, 40 thousand dollars.

OK, only the drilling will be like 10,000, like 15,000 maybe. But they don't tell you about all the trimetology you have to do, the hydrogeologist, you have to pay all the documents. And I'm going to explain maybe later how is the trimetology to get all these permits.

So it can be like 40,000 dollars, 30,000. If you have like a condominium and you want to subdivide properties and then you need a bigger well, a bigger diameter, deeper. So it would be maybe 30 to 40,000 only the drill, but plus the pump, the electricity and everything.

I mean, it can get to 80,000, 100,000 dollars. Wow.

[Richard Bexon]

So, yeah, I mean, again, so just for anyone listening there, if you're building a home, an artisanal well is the way to go. But I mean, I think probably an easier thing. I mean, if you've got a river on your property, it's probably easier to get a concession on the river than it is to dig an artisanal well.

[Jorge Matarrita]

Well, for an artisanal well, there is no need for permission. You can do it. So it's very easy.

The problem is if you have the water table where you can get it, where you can reach it, because you can get so much by hand than, I don't know, like 15 meters, 20 meters is the deepest artisanal well. If you get a concession from the river, that's very good. But then you have to look at the quality of the water.

Then you have to implement, you know, like bacteriological controls and physical chemical analysis and everything to get all the bacteria out of the river. Because in the rivers, all the flow from the upper parts of the basin is going to go there, either, you know, agricultural or urban or anything will go to the river. So pollution might be a thing.

The best would be to have a spring. That would be the best scenario because then you can catch it. You know, it's clean because it's mostly coming from the underground, as we learned already.

It's groundwater popping out by nature on the surface. And then you can take it there by gravity. No usage of electricity, pumps or anything like that.

And then you can have the water all over your property. That's very good. But you're going to have a setback.

Yeah, I'm going to have a setback.

[Richard Bexon]

OK, yeah, I mean, I think it's very important when anyone's buying land with, you know, rivers, waterfalls, Nassi Entis, which is, again, which are springs to really do your due diligence and have someone like Jorge really kind of take a look at this. Because, again, you could have a beautiful piece of land, guys, you know, with these building plantels. But if the building plantels are in the setback, you're not going to get your approval in order to to build on them.

So I think very important to do that analysis and due diligence. So, yeah, I mean, I structured a deal a while back here with some clients that were buying a large piece of land to do a project out in Manta in Kabul, actually to drill a perforated well. But because the property had no water and it was a kilometer from town, which had the water infrastructure.

But we just structured the deal that, again, they would not close until they hit water. And unfortunately, you know, they went down about 60 meters and still did not hit water, you know, not enough. So, you know, it was determined to just it was better to walk away from it than to actually continue to invest in the drill.

So, you know, but it was better. I think they lost it was better investing twenty five thousand dollars than losing hundreds and hundreds and thousands of dollars, you know, on buying a piece of land with no water because land without water is useless. Definitely.

Definitely. You know, it's expensive ocean view grazing, cattle grazing land. Yeah.

[Jorge Matarrita]

And that's even if you can't drill now because since, you know, tourism exploded in Guanacaste areas and some other places in Costa Rica, there has been a prohibition for drilling. So now the government, it's very tight on environmental laws and especially in water resources laws. So I can tell you, you cannot drill in Potrero, Flamingo, Tamarindo, Huacas, you cannot drill in Ocotal, El Coco, Playa Hermosa.

So all those 90s places that exploded with tourism and building and everything, they became a problem for the aquifer because not only there was a few quantity of water, but the quality was being jeopardized by the water from the ocean. It's called water salt intrusion and it gets the aquifer salty, the coastal aquifers. And only God can save those aquifers in thousands of years, because that's why they had to drill in Sardinia, in the other side of the mountains from Guanacaste, because there was a bigger aquifer and then pop the sweet water over to Ocotal and El Coco to give those hotels and those developments the water they needed.

[Richard Bexon]

I know I have an eight bedroom villa in Playa El Coco, but we've had the water meters and the water infrastructure for many years, but the water is always great there.

[Jorge Matarrita]

Yeah, and there are some other places, hot places now like Samara, Nosara is going to be on the way, you know, Punta Leona in Central Pacific, it's closed for drilling. And even here in Central Bali, especially in Irelia, where you live, there is a provision for drilling, only the big aquifers, the institutionals are allowed to drill until they make more studies and understand this groundwater that, as I told you, it's difficult to understand.

[Richard Bexon]

Yeah, no, I mean, I think that's great from Costa Rica. I mean, it does slow down development, which sometimes is good. You know, I'm very happy that Costa Rica's development is slow and sustainable.

And these analysis, I mean, they may take years to do sometimes. And, you know, Tico time here, you know, one year means three, maybe four, maybe five, but I think it's good because it keeps this country raw and authentic and only the people that really want to do something in this country end up doing it. I mean, if you're looking to make a quick buck, you know, I mean, it can be done, but it's just that, like, again, if you're trying to do a project here and make a quick buck, that's not going to happen.

It's going to take years to do larger projects here. But, I mean, in your opinion here, because I think we've touched enough here on water. I mean, what are the beach towns that you think are really going to grow over the next five years?

[Jorge Matarrita]

Okay. Well, me, myself, I have investments in Ojo Chal, as I heard you do have. I see Uvita, Ojo Chal, that region is growing because the people that came before in Guanacaste, now they're saying, oh, maybe now this is to develop.

I want to go to something more wild, more like 40 years before. And so they come down to the Osa Peninsula or Ojo Chal, Uvita. And yeah, but still, I mean, it's still in Guanacaste, you got Nosara and Santa Teresa, those are like surfing places.

And I even helped for the construction of the environmental permits for the Mel Gibson house in Santa Teresa. Yeah. So, as you know, many stars are coming down Santa Teresa, Nosara, those areas are very hot.

But maybe right now some people are listening to our podcast and not thinking about John Lee the beach. Maybe they want some brutal areas as well. You mentioned DOTA, you have investments there.

I think there is a good place. I've been called already many times there to search for water, look for aquifers, see where we can drill, because it's the same, there is not a big aqueduct there. Properties are in the mountains, and you have to mostly find your own water.

And for those that want to come here and maybe stay near the city, I would say San Ramon, Grecia, Naranjo, those are nice places. All the city, all Costa Ricans are going in that direction. There is tons of work coming down there.

Many international companies are going to settle there. The Aeropuerto Internacional, international airports around. And so I think those are good places to invest.

[Richard Bexon]

I agree. Well, Jorge, my last question for you. I mean, if you inherited $500,000 and had to invest it into a business or real estate in Costa Rica, what would you invest it in?

[Jorge Matarrita]

Okay. Well, I think I would take like $100,000 for equipment investment. I would like to have a drone that can make you the topography almost automatically for my business.

We fly, it has LiDAR sensors and a bunch of things. I will get some GPS and more equipment for those due diligence to make them faster, to have an efficient methodology for getting the client as fast as they can the information if there is a water setback or if there's no water or all those that we talk about. And probably expanding into geotechnical soil testing.

These are big projects in Costa Rica, almost for every house or every construction, you will need to shake the soil in Costa Rica. Most of the municipalities will ask you even for a two-floor house. So there is big money on the business there.

But I would say maybe another $200,000 to buy another apartment here in Costa Rica, in San Jose. And another $200,000 would spend it in, I don't know, maybe some property for myself. Where would you buy, Jorge?

Well, I already have some in Oaxaca, but I think I will buy something more for my retirement. Maybe Naranjo, San Ramon. Those are nice places because it's a little cooler than down the beach, but you are one hour away from Central Pacific.

And you're in the mountains, can be higher up in the mountains, plus volcano, it's just 30 minutes, 40 minutes. I think it's a good place.

[Richard Bexon]

I mean, if you were to buy at a beach destination beyond Oaxaca, Jorge, or one or two, I mean, which ones would you be looking at and why?

[Jorge Matarrita]

Well, I think I love Santa Teresa, but I don't think it's going to be enough money, the $500,000, because Santa Teresa and Oaxaca are so hot now. It's so expensive. A million-dollar house is just going up.

And land, it's a shortage of water and land. But yeah, for a realistic $500,000 to make business in the beach, I would say South Pacific, let's say Dominical or Uvita. Okay, fantastic.

[Richard Bexon]

Yeah, I mean, I think it's the area that's seeing a huge amount of growth is Uvita-Ho-Chau. I mean, it has an excess of, again, great water infrastructure, great restaurants, easy to get to. And I mean, it's raw and authentic still.

And great prices.

[Jorge Matarrita]

Yes. I mean, with $500,000, you can get a super huge property, even subdivided and do whatever you want. But when I guess right now with $500,000, as they say, in Oaxaca or Santa Teresa, you will get just a small property with a nice house.

[Richard Bexon]

Exactly, exactly. Well, Jorge, thank you very much again for your time. Anyone wanting to contact Jorge, I'll put all of his contact details in the descriptions here.

But really appreciate you taking your time to come on the podcast and share your experience and knowledge with us, Jorge.

[Jorge Matarrita]

I don't know. Thanks to you for having me in your podcast. It's an honor.

It's my pleasure. Fantastic. Have a great day, Jorge.

Thank you very much. Goodbye.