Tejon Ranch will protect a huge area of their land for conservation. With Governor Arnold Schwarzenegger at the ceremony, Tejon announced 90-percent of the vast holdings will be set aside for preservation.

The agreement was unveiled at the ranch Thursday morning. Five major environmental groups hashed out the plan with Tejon Ranch over the last two years.

Under the plan, Tejon will put 178-thousand acres into conservation, and they'll set aside another 62-thousand acres which the environmental groups can buy for preservation.

Part of the agreement includes a promise by the environmental groups not to oppose future development which Tejon plans on other parts of their land.

Tejon President Robert Stine calls the agreement "historic." And Governor Schwarzenegger praised the plan.

"We can do both, protect the environment and protect the economy at the same time," said Schwarzenegger. "The Tejon Ranch is a perfect example of that."

Schwarzenegger says with Tejon continuing their planned developments, that will bring jobs -- and new places for people to live.

Tejon Ranch stretches over mountain tops from the deserts of East Kern County to Interstate-5. Environmentalists say the area is unique and vital to preservation of wildlife. It's an area where several ecosystems meet.

Groups signing on to the agreement include Audubon California, Natural Resources Defense Council, and the Sierra Club. With the plan in place, that would mean a total of 240-thousand acres preserved as habitat and open space.

Gordon Nipp is with the local Sierra Cub chapter, his reaction? "It's astounding. Actually it's something that I wouldn't have thought possible a couple years ago."

Several years ago, Tejon announced a plan that would have put 100-thousand acres into conservation. Nipp thinks this agreement not only saves more land -- it's a better plan for wildlife.

"As it turns out, when you think about it -- 100-thousand acres wasn't enough to create the sort of wildlife corridors-- they're really necessary," Nipp told Eyewitness News.

But, the Center for Biological Diversity opposes the Tejon agreement. "On paper the deal sounds good," says Peter Galvin in a statement. "But a close examination shows that very little is gained biologically and far too much is sacrificed."

This group says critical habitat will be lost in the areas where Tejon will continue commercial and residential development.

Tejon will continue development of their industrial center along I-5 at the base of the Grapevine, a 23,000-home "master planned" development just south of the Los Angeles county line, and a mountain "residential resort."

Again, that will go forward with a promise of no opposition from the five environmental groups signed on to the agreement. How important is that?

"I think that's a critical portion of it," Tejon spokesman Barry Zoeller told Eyewitness News. "Because certainly the Ranch faced -- with organized, well-funded environmental opposition -- years and years of delay."

Under the plan, the preserved lands would be managed by an independent, non-profit organization -- the Tejon Ranch Conservancy.

But, Zoeller explains the ranch will still own those 240-thousand acres. "The Tejon Ranch will still own it, but the conservation easements mean nothing will ever be built on it. Then, it will overall be managed by the Tejon Ranch Conservancy -- working with Tejon Ranch."

Zoeller says Tejon Ranch will still get use of the preserved lands for things like grazing and film- and movie- locations.

But, the environmentalists say this area is prime and significant for preservation. Tejon president Bob Stine thinks the agreement means good things for the future, and everyone wins.

"This agreement is good for conservation, it's good for California," said Stine. "And it's good for the company and our share-holders."