CCIM: Your DECEMBER PRESENTATION states on page 2 that “TGOD will be positioned as one of the highest quality & lowest cost producers in Canada ….”. How? What separates TGOD from the pack? Your energy management strategy may be of particular interest.
TGOD: Any investor looking to find a cannabis company to invest in, this should be one of the major questions they ask.
For us, a few members of our team helped Organigram go public in 2014, and a few helped Emblem Cannabis (myself included) go public in 2016. Through that process we learned an incredible amount about how to make a cannabis company successful. The two largest elements we learned about were how capital intensive this business actually is, and how difficult it actually is to grow a high quality product for the lowest possible cost.
We immediately knew we needed to overcome both of these challenges when we got started with TGOD. We partnered with Eaton Corp, the Hamilton Utility Company, and are now working closely with Hydro Quebec to lay the framework for one of the lowest cost energy efficient operations in Canada. We achieve this by working with Larssen & Operating in Quebec.
- Larssen is best known for the successful implementation of cutting-edge automation features, proprietary design characteristics that generate exceptional yields, and the use of advanced energy efficient materials and technologies.
- Quebec has the lowest cost of power in Canada at just over $0.05c per kWh, in comparison, Ontario is 260% more expensive at $0.13c per Kwh.
To maintain that high quality product we grow completely organic. Organic cannabis demands a premium price and is a high demand product.
CCIM:This same document concludes that the Canadian supply & demand currently “has a massive supply demand gap” such that demand outstrips supply. Is that still TGOD’s projection and if so, how will TGOD ensure maximum shareholder value, customer and client satisfaction (including attraction and retention) – particularly in the face of price ceilings and some provinces implementing monopoly distribution networks?
TGOD: That’s not just TGOD’s projection, that’s an industry statistic. We are so far undersupplied for legalization it’s not even funny. This is why health Canada is continually adding new LP’s to the market and continually increasing the productive capacity of existing LP’s. Although the funded buildout is now well over 1 million kg’s annually, that’s going to take some time to scale up to.
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