Emerald Health Therapeutics Announces Positive Health Canada Review of its Licensed Producer Application for Pure Sunfarms Facility

Emerald Health Therapeutics Inc. (TSXV:EMH) (OTCQX:EMHTF) announced today that its licensed producer application for the Pure Sunfarms Delta 3 greenhouse facility under Access to Cannabis for Medical Purpose Regulations has met the requirements of the paper-based review of Health Canada’s Office of Medical Cannabis. The OMC confirmed satisfactory provision of information regarding the security plan, record keeping and tracking systems, QA reports, and security clearance for key personnel, among other items. Pure Sunfarms is a partnership between Emerald and Village Farms International, Inc..

Accordingly, the OMC has invited the submission of written and visual evidence, upon completion of conversion of the facility, demonstrating that there is a functioning facility that adheres to the OMC’s regulations. Health Canada’s satisfactory review of this evidence may then result in their issuance of a cultivation license for the Pure Sunfarms facility. Pure Sunfarms has commenced physical conversion of the 1.1 million square foot Delta 3 greenhouse. Completion of conversion of the first 250,000 square feet of the greenhouse facility and submission of the confirmation of readiness documentation to Health Canada are expected in February 2018.

“We appreciate the fast, preliminary review by Health Canada of our licensed producer application for the Pure Sunfarms site,” said Dr. Avtar Dhillon, Executive Chairman of Emerald. “I applaud our team for advancing the application process to this stage as we work toward our goal of creating one of the most efficient, low-cost growing operations to serve the growing wellness and medical market as well as the anticipated recreational market in 2018.”

“The meticulous preparation by our teams and Emerald’s excellent track record of compliance with Health Canada have been beneficial in enabling an expeditious review process,” said Michael DeGiglio, CEO of Village Farms. “The Pure Sunfarms partnership combines the extensive expertise of Emerald in cannabis cultivation, research and development and Village Farms’ deep experience in large scale, efficient greenhouse cultivation. Together we are positioned to become one of the premier cannabis growers in Canada.”

Emerald has significant cannabis industry experience, a portfolio of diverse genetics, and an excellent record of operations under Health Canada’s stringent ACMPR regime. Village Farms is one of the largest and most technically advanced greenhouse produce growers in North America, with high-quality, low-cost greenhouse agricultural production.

Pure Sunfarms is converting its existing 1.1 million-square foot (25-acre) greenhouse facility located in Delta, BC to cannabis production for medical use and adult use, for which the Government of Canada is working to provide regulated and restricted access by July 2018. This facility is projected to yield about 75,000 kg of cannabis per year in 2020. Pure Sunfarms also has options to acquire from Village Farms two additional greenhouses with 3.7 million square feet, which could potentially yield an additional 225,000 kg of cannabis annually. At scale the cost of production including depreciation is expected to be less than $1.00 per gram.

Pure Sunfarms is converting its greenhouse from tomato growing into cannabis production using both natural and supplemental lighting. Upon completing the 250,000 square foot first phase, Pure Sunfarms will immediately continue with the next conversion stages, with the second quadrant expected to be completed in the fall of 2018.