WINNIPEG, Oct. 26, 2018 /CNW/ - DELTA 9 CANNABIS INC.
(TSXV: NINE) (OTC: VRNDF) ("Delta 9" or the "Company") is pleased
to announce its production and extraction plans for 2019 as well as
a status update regarding its current operational expansion.
Specifically, Delta 9 wishes to announce: (i) that the Phase 1
development of Delta 9's grow facility in Winnipeg, Manitoba will be completed ahead of
schedule, and significantly below budget; (ii) Delta 9's plans for
the Phase 2 development of its Winnipeg grow facility; (iii) Delta 9's
acquisition of land for its planned 'Delta 9 Cannabis Campus' in
Winnipeg; and (iv) the anticipated
schedule for the opening of the Delta West extracted products and
product development facility in Calgary,
Alberta.
Delta 9 Grow Facility - Phase 1
Delta 9 CEO John Arbuthnot announced today that the planned
Phase I development at its grow facility in Winnipeg is expected to be completed on or
before November 7, 2018 at a total
estimated cost of $4,312,000, which
is approximately 30 per cent below its original budgeted estimate.
The Delta 9 grow facility uses proprietary grow pods for producing
cannabis. Each grow pod is constructed from a repurposed 320 square
foot steel shipping container and can produce approximately 32.5
kilograms of cannabis annually.
The Phase 1 development of the Winnipeg grow facility covers approximately
40,000 square feet with grow pods stacked two high. The following
grow pods will be located in this area of the facility:
Utility/Support: 20 support pods with a total area of
6,400 square feet. These pods will be used for housing cannabis
genetic products and vegetative plant growth as well as facilities
such as processing, packaging, labeling, two laboratories, a wash
area, and storage.
Flowering Pods: 134 grow pods with a total area of 42,880
square feet. These grow pods will house flowering cannabis
plants.
Once the Phase 1 development of the Winnipeg grow facility is complete, there will
be a total of 154 grow pods, offering 49,280 square feet of
production space, and estimated production capacity of 4,288
kilograms of cannabis annually. Delta 9 aims to certify the
facility under the European Good Manufacturing Practices ("EU GMP")
standard in order to be able to export cannabis products to the
European Union.
"This project was not expected to be complete until the end of
this year, but the Delta 9 grow pods we've designed have turned out
to be even more efficient than we expected," said Arbuthnot. "We
are now able to expand very quickly, and at a very low capital cost
as compared to our competitors in the industry. Each grow pod costs
approximately $26,000 fully
installed, and can produce approximately $325,000 per year in revenue, assuming a retail
price of $10 per gram of
cannabis."
Delta 9 Grow Facility - Phase 2
The area of Delta 9's grow facility in Winnipeg containing the Phase 2 development is
approximately 40,000 square feet in size and can also house two
stories of grow pods. Delta 9 estimates that there will be a total
of 154 grow pods contained in this area of the facility when it is
completed. Delta 9 estimates that this area of the facility will be
completed in the second quarter of 2019 at a cost of approximately
$4,312,000. Once completed, this area
of the facility is expected to produce up to an additional 4,288
kilograms of cannabis annually. The following grow pods will be
located in this Phase 2 area:
Utility/Support: 20 support pods with a total area of
6,400 square feet. These pods will be used for housing cannabis
genetic products and vegetative plant growth as well as facilities
such as processing, packaging, labeling, two laboratories, a wash
area, and storage.
Flowering Pods: 134 grow pods with a total area of 42,880
square feet. These grow pods will house flowering cannabis
plants.
The Delta West Facility - Phase 1
Delta 9 and Westleaf Cannabis Inc. ("Westleaf") have formed a
50/50 joint venture partnership to build and operate a
state-of-the-art cannabis extract, testing and research and
development laboratory to develop and manufacture diversified and
derivative cannabis products, pending approval of such products by
the federal government. The facility is located in Calgary, Alberta and has a total area of
60,700 square feet. The Phase 1 development of this facility will
occupy approximately 15,800 square feet.
The Phase 1 development will include a research and development
facility, a processing lab, a manufacturing plant, and an order
fulfillment centre, all built to the EU GMP standard in order to
access international export markets. The facility will be designed
by a North American leader in the design and construction of super
critical carbon dioxide extraction operations.
Numerous types of cannabis products have been created or are
under development in this facility at this time, in what the
Company projects will be one of the largest cannabis oil extraction
and extract manufacturing facilities in Canada. The production license
application for the Delta West facility was submitted to Health
Canada in August, 2018 and construction began in September, 2018.
The Company expects a cannabis processing license will be awarded
in the second quarter of 2019.
"Our goal is to become one of the world's foremost producers of
innovative cannabis derivatives," said Scott Hurd, CEO and President of Westleaf. "This
project is designed to support cutting edge research and
development, which will result in the production of high quality
products that serve an increasingly sophisticated clientele and
produce higher margins than dried cannabis."
Delta West Facility - Phase 2
The second phase of the development of the Delta West facility
is designed to significantly increase the capacity of the facility
and to produce a wide variety of new derivative product lines,
including concentrates, vape cartridges, edibles, and beverages,
once these types of products are permitted for production and sale
under Canadian regulations. Phase 2 of the Delta West facility is
estimated to have a total area of approximately 44,900 square
feet.
Winnipeg Expansion Facilities:
On October 11, 2018 the Company
announced that it has closed its previously announced acquisition
of the land and the 80,000 square foot building containing the
Company's current cannabis production facility from 6599362 Canada
Ltd. for $6,250,000. Management is
currently planning multiple expansion facilities on the
Winnipeg site which will utilize
the Delta 9 grow pod system. Delta 9 is planning to expand its
annual cannabis production capacity to 17,500 kilograms by the end
of 2019. Further expansion is planned on a "Delta 9 Cannabis
Campus" slated for construction on an adjoining parcel of
industrial land.
Retail Operations
Delta 9, through its subsidiary Delta 9 Lifestyle Cannabis
Clinic Inc., has opened its first retail cannabis store in
Winnipeg, Manitoba. This store is
expected to be part of a network of retail outlets under the Delta
9 Cannabis Store brand. The 3,200 square foot cannabis super store
opened on October 17, 2018, and
logged more than 9,000 separate purchases of cannabis and
accessories in the first six days of operations.
The Company is currently building three more retail outlets in
Winnipeg, Thompson and Brandon
Manitoba, and has partnered with a Manitoba First Nation to
open a fifth store. Additionally, the Company has prequalified for
the Manitoba government's request
for proposals to build additional 'micro stores' in smaller, rural
communities.
On behalf of the Board of Directors of the Company
John Arbuthnot, CEO and Director, Delta 9 Cannabis Inc.
About Delta 9 Cannabis Inc.
Delta 9 was the fourth
producer in Canada licensed to
produce legal cannabis. Delta 9 now operates its wholly-owned
subsidiary, Delta 9 Bio-Tech Inc., as a licensed producer of
medical marijuana pursuant to the ACMPR and operates an 80,000
square foot production facility in Winnipeg, Manitoba, Canada. Delta 9 also owns
50 per cent of the 60,000 square foot Delta West facility in
Alberta, and co-owns the Delta
Nine Cannabis Store retail network. Delta 9's shares trade on the
TSX Venture Exchange under the symbol "NINE" and on the OTC under
the symbol
VRNDF.
About Westleaf Cannabis Inc.
Westleaf is a private
vertically integrated cannabis company focused on innovative retail
experiences, engaging cannabis brands, and premium cannabis
production. Westleaf is headquartered in Calgary, Alberta. Since incorporation,
Westleaf has used its funds to execute its vertically integrated
business plan, which includes applying for prospective cannabis
retail locations in privatized markets across Canada, developing an extraction and
processing facility in Calgary,
Alberta and developing a large scale indoor cannabis
cultivation facility located in Battleford, Saskatchewan. Westleaf is
developing a national retail footprint for its retail concept
"Prairie Records", which leverages the instinctual tie of
recreational cannabis and music and redefines the cannabis
purchasing experience. For more information, please visit
www.westleaf.com.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Disclaimer for Forward-Looking Information
Certain statements in this release are forward-looking
statements, which reflect the expectations of management regarding
the Company's future business plans and other matters.
Forward-looking statements consist of statements that are not
purely historical, including any statements regarding beliefs,
plans, expectations or intentions regarding the future. Often, but
not always, forward-looking statements and information can be
identified by the use of words such as "plans", "expects" or "does
not expect", "is expected", "estimates", "intends", "anticipates"
or "does not anticipate", or "believes", or variations of such
words and phrases or state that certain actions, events or results
"may", "could", "would", "might" or "will" be taken, occur or be
achieved. Forward looking statements in this news release include
statements relating to: (i) the expansion plans of Delta 9 and
Delta West, including construction of new facilities and retail
expansion; (ii) Delta 9 and Delta West's production of cannabis and
cannabis products; (iii) Delta 9 and Delta West's development of
new cannabis products; and (iv) the grant of a cannabis processing
license to Delta West. Such statements are subject to risks and
uncertainties that may cause actual results, performance or
developments to differ materially from those contained in the
statements, including those risk factors set forth in the annual
information form of Delta 9 dated May 31,
2018 which has been filed on SEDAR. No assurance can be
given that any of the events anticipated by the forward-looking
statements will occur or, if they do occur, what benefits the
Company will obtain from them. Readers are urged to consider these
factors carefully in evaluating the forward-looking statements
contained in this news release and are cautioned not to place undue
reliance on such forward-looking statements, which are qualified in
their entirety by these cautionary statements. These
forward-looking statements are made as of the date hereof and the
Company disclaims any intent or obligation to update publicly any
forward-looking statements, whether as a result of new information,
future events or results or otherwise, except as required by
applicable securities laws.
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SOURCE Delta 9 Cannabis Inc.