CEDAR CITY, Utah — Robert (Wally) Spencer is a former rocket scientist who claims to have unraveled the greatest riddle in the torrid West. For a price--maybe $5 million--he may even tell you the secret.

Scouring the dusty desert floor with satellite maps and a secret contraption loaded in his four-wheel-drive truck, Spencer says he has found a 500-million-year-old river running beneath Utah, Nevada and Southern California.

The ancient sunken waterway is so huge, as Spencer tells it, that it could quench the thirst of 100 million people and forever lay to rest worries about droughts and water shortages from here to Los Angeles.

"I am willing to help the western United States overcome its water supply problems, but I feel I should be compensated for my efforts," said the 63-year-old chemical engineer, who for three years has refused to divulge the river's location.

Spencer is an unabashed water speculator, one of a hardy breed of entrepreneurs hoping to cash in on the West's most endemic and confounding scarcity. With the era of big dams and ambitious aqueduct projects slipping into memory, officials are looking with interest at the prospectors and their sometimes unconventional claims about new sources of water.

"In the old days, only big public agencies could provide water because it was all done through massive engineering projects," said Timothy H. Quinn, an economist with the Metropolitan Water District of Southern California, the largest local wholesaler in the West. "Now you have a degree of competition that was unheard of before. That is very new in the world of water."

Many of the private schemes are as simple as a rancher offering to sell his irrigation water to a nearby town or, through a domino of exchanges, to a more distant megalopolis. Some involve investors buying up barren land and piping its underground water to sprawling housing developments at a handsome profit.

Other projects are more grandiose. A team of prospectors in northern Nevada wants to capture millions of gallons of mountain rainfall by drilling deep wells in hillside faults, funnel the water into the Humboldt River, and transport it to cities and farms downstream. The scheme, organized as Eco-Vision Inc., involves years of research and would cost tens of millions of dollars to pull off.

Although some of the schemes are more improbable than others, the West is growing too fast for water officials to simply dismiss what might be a major new source.