Portuguese firm Holigen is in the final stages of obtaining a license for one of the largest cannabis cultivation facilities in the world.
The license will permit it to produce more than 500,000 kilograms per year on a 72ha plot in the Alentejo region. It is investing €40 million ($45.7 million) in building the facility and it has been working on the project for the past 18 months.
It will include 65ha of cannabis plants, plus a Good Manufacturing Process compliant greenhouse facility that will yield another 110,000 kilograms per year. The Portuguese government has designated it as a Project of National Interest, and Holigen expects to have the license finalized by mid-2019.
The construction and licensing project should now be accelerated after Holigen sold a 19.8% stake to Canadian firm Flowr (TSX.V: FLWR) for a cash payment of C$6 million ($4.4 million). “We believe this is a transformative transaction that establishes Flowr as a global player in the cannabis industry,” said Vinay Tolia, co-chief executive of The Flowr Corporation. “We’re using our financial strength and industry-leading cultivation expertise to gain exposure to the rapidly expanding European and Australian markets through Holigen.”
Holigen is present in Portugal and Australia, where it has already achieved GMP status for a cannabis production plant near Sydney. Peter Comerford and Pauric Duffy founded the company, and the former looks after the Australian side of the business, while the latter runs the Portuguese business, which includes a subsidiary called RBK Biopharma.
This subsidiary is running the project in Alentejo and chief operating officer Aldo Vidinha declared that it will be the biggest cannabis cultivation facility in the world when it is fully up and running in 2020. He estimates that it will produce 635,000 kilograms per year, which would instantly catapult Holigen into the world’s top few producers.
Flowr hailed Portugal’s potential as a hotspot for cannabis cultivation due to the favourable climate and the low labour costs. It will bring high yield growing technology and operations to the project, said Comerford.
Holigen hopes to become a leading exporter of cannabis from Portugal and Australia. It is forming partnerships with distributors serving Germany, Poland, the UK, and Ireland, and it claims to have strong ties to the largest medical cannabis distributor in Australia.