Federal approval for a cultivation licence to grow marijuana means an Airdrie-based company now has funding to break ground on a $110-million facility on a lot in the southeast industrial area of Olds.
Federal approval for a cultivation licence to grow marijuana means an Airdrie-based company now has funding to break ground on a $110-million facility on a lot in the southeast industrial area of Olds.
After four years of applications and inspections, Sundial Growers, a former cucumber farm, finally received the OK from Health Canada on June 12. This makes them the third legal cannabis producer in Alberta, in addition to Acreage Pharma Ltd., which also has a cultivation licence, and Cremona-based Aurora Cannabis, which is allowed to both grow and sell.
The stamp of approval has in turn opened up funding to the tune of $29 million for Sundial from an income streaming financial company, Cannabis Wheaton, based in Vancouver.
Cannabis Wheaton is investing in 15 cannabis-producing companies across the country in exchange for a portion of their manufacturing stream down the road. For Sundial, that means $29 million in order to build on the first of three 10-acre lots recently rezoned as Direct Control 7, and consolidated into a single parcel in the Olds industrial area.
In comparison, the total construction value of all building permits granted by the Town of Olds last year was just short of $14 million.
The first phase of building will include four preliminary units on the first 10 acres, each of which house growing operations, from nursery to processing and packaging. The full development will include an additional 11 units on the adjacent 20 acres, and is expected to cost a total of $110 million.
"This will be, by far, our largest grow operation," said Geoff Thompson, part of Sundial's corporate development team. "Airdrie is a facility that will allow us to test out how we build this facility, but this will be more than 10 times larger."
The facility in Airdrie is 32,000 square feet. Compare that with the 112,000 square feet for the initial four units in Olds, and eventually a total of 405,000 square feet of manufacturing facilities. Thompson says they expect some 200 new employees to eventually work in the new buildings.
In addition to the seed money, Thompson said Cannabis Wheaton will also provide expertise from the people who built Tweed, now known as Canopy Growth, which was the first federally regulated, publicly traded cannabis producer in North America.
"We will use those people to help build out the operations here in Olds," said Thompson.
Thompson also said that once Sundial establishes its board of directors, the CEO of Cannabis Wheaton, Chuck Rifici, will take up a spot.
Last week, Roy McIntyre, who heads up quality assurance for Sundial, gave a lunch presentation for the Olds & District Chamber of Commerce.
"Clearly there was a lot of interest here today, but not everybody has the knowledge of the industry as a whole or where we want to go with it," said McIntyre.
Of major concern is the security of the facility coming to town.
"It's layers upon layers of security," said McIntyre. "These places are more secure than the Bowden Institute. So if everybody is comfortable with Bowden, and the industry is above and beyond that, then I think it is certainly a safe thing to forge ahead with."
While their current operations target medical marijuana, McIntyre expects things will change over the coming year, with the federal government's announcement that they will soon legalize recreational use.
Thompson said they will be waiting on consumer information to understand what the market wants – whether that's medical or recreational use, and whether it comes in oils, pills, lotions or the traditional smokable form.
"There will be lots of innovation," Thompson added. "What you see today, versus what you'll see five or 10 years from now will change."
Now that Sundial has its cultivation licence, they hope to begin growing within the month in Airdrie.
Thompson confirmed that the company now has the required development permits and land use approvals from the Town of Olds for the consolidated lot, and that the current timeline is to break ground sometime in the third quarter of this year. He said they hope to be operational by January 2019.
Eventually 200 employees could be working in the company's new buildings in Olds
