MMJ reports 250% planned cannabis flower production increase by 2019
United Greeneries’ Lucky Lake cannabis growing facility.
Pot stock investor MMJ PhytoTech (ASX: MMJ) reported its subsidiary Harvest One (TSX-V: HVST) plans to boost its cannabis flower production 250% by the end of 2019.
MMJ holds more than 53 million shares in Harvest One, which, in turn, owns 100% of United Greeneries.
According to MMJ, United Greeneries will expand its dried flower capacity from 20,000kg by the end of 2018 to 70,000kg by the end of 2019.
Harvest One will fund the expansion via its C$40.25 million bought deal offering which closed last week.
The expansion includes proposed changes to the Luck Lake facility in Canada’s Saskatchewan province.
The facility sits on 18 acres and is currently 62,000 square feet. United Greeneries will construct two levels of internal growing rooms, which is anticipated to create 80,000sq ft of growing space to grow 12,000kg of dried cannabis flowers per annum.
United Greeneries plans to increase this by preparing the site for staged expansions using modular building systems to reach maximum production by the end of the year.
Meanwhile, the Chemainus facility has been pegged to begin producing about 8,000kg per annum of dried cannabis flowers. The company anticipates completing fit-outs and beginning cultivation by the end of the year.
Chemainus is in proximity to United Greeneries’ primary cultivation facility Duncan on Vancouver Island. As part of the production boost, United Greeneries has begun a 15,000sq ft expansion to rapidly produce large amounts of rooted cuttings and pre-grown starter plants for use in all of the company’s facilities.
In addition to its indoor growing and research facilities, United Greeneries has purchased 398 acres of land in British Columbia for an outdoor operation.
By the end of 2019, the company expects to grow up to 50,000kg of dried cannabis flowers at the site.
United Greeneries claims the outdoor operation will enable it to grow a number of its cannabis varieties.
“Following on our most recent bought deal financing, the company is well-positioned to execute fully on all our expansion plans within the fastest possible time, as all our capital expenses and operating costs for the next two years are covered,” Harvest One chief executive officer Andreas Gedeon stated.
However, Harvest One cautions these plans all remain subject to gaining requisite regulatory approvals from the Canadian Government.
MMJ remains highly exposed to Canada’s medicinal cannabis and incoming recreational cannabis markets through several strategic investments.
Shares in MMJ finished the day more than 14% higher at A$0.47.