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Cannabis production facility announcement gets big welcome

Stewart MacNeil, left, a medicinal cannabis user for about the past decade, poses for a photo with Dave Callahan, president of Back Home Medicinal Cannabis Corp., following an announcement of the establishment of a new cannabis production facility in Barachois Brook on Friday.
Stewart MacNeil, left, a medicinal cannabis user for about the past decade, poses for a photo with Dave Callahan, president of Back Home Medicinal Cannabis Corp., following an announcement of the establishment of a new cannabis production facility in Barachois Brook on Friday. - Frank Gale

As a user of cannabis for medical purposes for the past 10 years, Stewart MacNeil of Flat Bay was thrilled with the announcement of a new cannabis production facility in Barachois Brook on Friday.

“The best part is that when their product is being sold, Back Home Medical Cannabis Corp. they will have an educational component,” he said.

Being educated on it was very important to him when he first started using cannabis to help out with his Crohn’s Disease and went to the United States in a state where it was legalized.

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He said he got good advice there and when Back Home gets set up with its state-of-the-art technology, he’s sure they’ll be providing education and the best product for people’s needs, whether it’s medical or recreational.

MacNeil said cannabis really helps out for inflammation and digestive issues associated with his Crohn’s.

Callahan, president of Back Home, said he started out in 2014 applying for licenses for this venture with the intention of creating jobs and bringing people “back home.”

He said with Biome and Jacob Capital, the investors in this venture, that he has found himself in great company.

“It was a bit of a selling period on our region and area,” he said. “I’m not doing this for business activity. I’m doing it for the area as well need jobs in rural Newfoundland.”

He said it was somewhat of a nostalgic morning because he was carrying some of his dad’s (Ron Callahan) ashes, who was well known for creating jobs for the local area.

Callahan said he could have taken this venture to the other side of the province but said no to those proposals, which were separate from Biome who was in agreement with this area.

Khurram Malik, a partner with Jacob Capital Management Inc., said their Toronto, ON based Biome Grow Inc. has most of its facilities in Atlantic Canada and its facility in Barachois Brook will be by far its largest in Canada.

He said they decided to go big here because of the policies this current government has put into place in regards to cannabis production.

He said while there has been chatter about a supply shortage, this facility will be highly automated and should get into production in the short term.

Christopher Mitchelmore, minister of Tourism, Culture, Industry and Innovation, said the provincial government’s partnership with Biome Grow is a continuation of their plan to build a new industry in this province, including in rural Newfoundland and Labrador.

He said as a result of their actions, the province is becoming a leader in Canada's cannabis industry, with at least 260 new production jobs and a further 220 plus retail jobs associated with the two cannabis agreements reached to date.

Highlights of the cannabis production agreement:

It is for 24,000 kg production and supply over three years.

It will represent close to $100 million in revenue per annum beginning in 2020.

The agreement allows Biome to recover up to $52M through reduced remittances to the Newfoundland and Labrador Liquor Corporation.

Biome will have access to five retail licenses in the province.

Biome will also invest $500,000 over five years for research and development in Newfoundland and Labrador.

Biome’s Newfoundland and Labrador company – Back Home is expected to produce Newfoundland and Labrador-grown cannabis in 2019.

The company plans to operate its production facility in the province for a minimum of 20 years.

The agreement will provide for 200 jobs, 120 of them in production and 80 in retail in the province. Local hires whenever possible.

Biome Grow will receive access to five retail licenses

The new production facility will be built in Barachois Brook in phases. Biome Grow is committed to produce local cannabis by the second half of 2019 and operate its production facility for a minimum of 20 years.

Retrofit by Bird Construction of an existing 18,000 square-foot building in Phase 1 and three 50,000 square foot sections of a new building in Phase 2, 3 and 4 for another 150,000 square foot facility.

There is approximately $6.5 million in annual salaries related to the project.

At peak of construction there will be 70 to 80 people working on-site.

Source: Biome Grow Inc.

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