Valens GroWorks Corp (OTC: VGWCF) said Monday it entered into a multiyear agreement to provide hemp and cannabis extraction services to The Green Organic Dutchman Holdings Ltd. (OTC: TGODF).
What Happened
Under the terms of the agreement, The Green Organic Dutchman will supply Valens with an annual minimum of 30,000 kilograms (approximately 66,000 pounds) of cannabis and hemp biomass, increasing to 50,000 kg in the second year.
Valens is set to process the cannabis and hemp into premium quality resins and distillates that The Green Organic Dutchman will use to produce oils, sprays and capsules, as well as oils for vaporization and edibles, beverages and topical products that it plans to launch once they are legal in Canada.
The initial agreement has a duration of two years.
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Why It's Important
This is the second major extraction agreement that Valens has announced in less than two weeks. On Feb. 27, Valens said it signed a similar agreement with another Canadian cannabis company, Tilray Inc. (NASDAQ: TLRY) to process a minimum of 15,000 kg of dried cannabis and hemp per year.
Valens is also working with The Green Organic Dutchman Holdings to expedite the organic certification for its organic processing methodologies, and upon certification, the company said it will offer one year of exclusivity to The Green Organic Dutchman for certified organic extraction processing services.
What's Next
Valens said it anticipates the arrival of the first shipment from The Green Organic Dutchman at the beginning of the second quarter and will immediately commence processing.
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