Quick! How can a region that was covered in sagebrush in 1996 create spectacular wine in 2008? If you're like most folks, you probably think of Washington State as a chilly and rainy place, but the Eastern part of the state is a virtual desert, with just three to five inches of rain a year.

Though it defies logic, the special microclimate of the relatively new AVA (American Viticultural Area) of Horse Heaven Hills is the reason behind its fantastic Merlot and Cabernet Sauvignon. The area is just below the Yakima Valley, in the South Central part of the state.

Recently, the entourage from the newly created Mercer Estates came to New York to showcase and explain their wines. Mercer Estates is a venture between Mike Hogue, of award-winning Hogue Cellars, and Bud Mercer, a longtime Prosser farmer whose family planted Mercer Ranch Vineyards in the early 1970s and started a winery in the Horse Heaven Hills in the mid-'80s, now owned by Paul Champoux and some partners.

During the press lunch, which was held at Blue Hill restaurant in Manhattan, I met winemaker David Forsyth and learned how much the curiously unique climate contributes to the grapes. For example, in Horse Heaven Hills (where Merlot and Cabernet Sauvignon is grown) wind comes up from the Columbia River and stresses the vines, producing more flavorful fruit. The wind also blows away any kind of rot or pest. In addition, Horse Heaven Hills has fine, sandy silt soils left by the ancient Lake Missoula floods.

Mercer Estate Merlot is sourced entirely from Horse Heaven Hills (which allegedly got its name after so many horses vanished when charging up the signature hill and falling to their own private heaven). The area's cool nights help preserve the grapes natural acidity to create wine with great balance. Wines are fermented in stainless steel tanks and pumped over, pressed off, then aged in French oak barrels. Five percent of Syrah is added (in the 2005 release) for roundness in the mid-palate. As you can imagine with this desert terrain, irrigation of the vines is necessary.

Valued at $24, Mercer Estate Merlot 2005 is about half of what its California equivalent would be. For the price, I found it velvety smooth with ripe mature blueberry aromas and a complex palate with black and blue fruit, along with notes of chocolate and coffee bean. Perhaps in the past, Washington State wasn't the first region that popped into your mind when you thought of a wine to bring for a dinner party, but from this tasting event, Washington State — especially Mercer Estate — is giving California a run for its money.