Vancouver-based greenhouse financing company CROP Infrastructure Corp. (CSE: CROP) is about to increase its presence south of the border.
The Canadian corporation just signed a deal with an unnamed Good Manufacturing Practices / International Organization for Standardization rated firm to construct a new extraction facility in Nevada.
CROP estimates the new facility will be capable of producing one ton of product per day.
Earlier this month, CROP unveiled a three-year supply agreement to see the production of 500,000 pounds of product per year with that same firm.
60% of the construction deal – a little more than $3 million– will be paid for with 89,000 pounds of product. The remaining balance of the deal is due to be paid in cash by revenue derived directly from extraction operations through June of 2019.
The facility will focus on producing CBD, rather than high-THC marijuana products.
CEO Michael Yorke from CROP Infrastructure Corp. commented on the development plans in a press release:
“The synergies and relationship between CROP and our off-take partner continue to evolve. We look forward to continuing to develop this new partnership into new opportunities and other territories. We believe this is an effective and creative way of financing and developing our growth in a non-dilutive arrangement.”
The company currently operates in Canada, Jamaica, Italy, and US states where marijuana has been legalized.
In those locations, CROP focuses on leasing, building, and managing infrastructure for both hemp and cannabis companies internationally.
CROP enters into joint ventures with licensed growers and funds development costs when those growers have been unable to acquire new capital from other investment sources.
From that point, CROP offers designs and equipment to the company and then recoups their investment through tenant, management, and branding fees.
In a statement to the Financial Post, CEO Michael Yorke stated the company’s intention to move rapidly into the US market as legalization arrives in more states.
According to the new development press release, CROP is currently harvesting 240 acres of product and is also preparing 1,800+ acres of CBD farmland for planting in the 2019 grow season.