Bophelo continues to operate during the COVID-19 pandemic with special approval from the local police. The first of three planned 2021 crops is already underway with a quarter of the summer harvest in the ground; 1,983 clones have filled 500 square meters of canopy. Bophelo anticipates planting 6,000 autoflower plants to fill an additional 2,000 square meters of hoop houses by the end of January 2021. By April 2021, Bophelo expects the harvest to yield approximately 800 kilograms of trimmed flower and 800 kilograms of material to produce medicinal cannabis oils. Bophelo plans to plant second and third crop within 2021.
To support a planned year-round perpetual harvest and future exports to MedCan, Bophelo has also launched a Mother Program with diverse strains including those from OG DNA Genetics. Currently, 40 mother plants across ten strains are thriving. Bophelo plans to grow the mother stock to 150 plants across more strains by continuing the strain hunt.
In addition, Louisa Mojela, Chair of the Board of Halo and well-known benefactor of the Lesotho community, has developed a recruitment program for local women to enter the Bophelo workforce to receive training in leading the day-to-day growing operations. The Company plans to recruit and train 30 leads with a focus on women empowerment and build a talent pool capable of sustaining operations.
Andreas Met, Halo’s Co-Founder and Head of International Operations commented, “I’m thrilled with the progress we have made at Bophelo. Not only do we have a strong senior leadership team in place, but our young leaders in Lesotho are developing rapidly. I believe we are in the process of shaking up the cannabis world as the local talent is eager to learn and will be competitive with any grower on the planet. We will be ready to fulfill our offtake with MedCan once the pandemic-related restrictions ease up.” Mr. Met recently relocated to South Africa.
In August 2020, Bophelo entered into an offtake agreement (“The Offtake Agreement“) with MedCan for the sale of bulk cannabis biomass primarily into the European market. The Offtake Agreement specifies initial deliveries of up to 10,000 kilograms which are now expected to commence in 2021 and are anticipated to be completed in 2022. Bophelo has been working with Pharmaconsulta Limited, a Good Agricultural and Collection Practices (“cGACP”) focused consulting firm to obtain Maltese cGACP certification which Bophelo now anticipates achieving by mid 2021.
Pursuant to the Offtake Agreement, MedCan will pay Bophelo prevailing market rates calculated on the basis of a price per gram of delivery weight. The price will be determined on the basis that MedCan shall seek to sell the batch at the highest value achievable in the market, currently estimated to be $3 per gram. The bulk cannabis to be delivered includes A and B-grade trimmed flower buds, as well as bulk material consisting of trimmings and sugar leaves for medicinal oil production.
MedCan has received approval of Malta Enterprise, a Maltese government agency, to carry out the importation and production of cannabis for medicinal purposes. MedCan has advised the Company that they have identified a facility that previously manufactured medicines under cGMP as approved by the European Medicines Agency and is currently negotiating long term lease with the landlord. MedCan expects operating from this facility will increase speed to market and avoid lengthy time retrofitting a facility for cGMP operations. MedCan intends to import cannabis from Bophelo pursuant to the Offtake Agreement and produce cannabis-based medicinal products for distribution and sale throughout the European Union and the other markets worldwide. MedCan has advised the Company that they anticipate they will be in a position to commence import and export activities as soon as practicable.
Mr. Met added, “We are pleased that MedCan, our Maltese partner, is progressing towards the credentials required to export cGMP approved cannabis from Malta. Our end goal, now in sight, is to process, manufacture, and distribute medical cannabis products to patients worldwide.”