HTC Extraction Systems (TSX.V: HTC) Hemp Biomass Extraction Facilities Take Shape

• HTC Extraction Systems has spent 14 years developing its ethanol and solvent-based distillation expertise and is now dedicating itself to cannabinoid extraction and refining using hemp biomass tolling agreements
• The company has completed construction on a 19,000-square-foot facility near Regina, Saskatchewan for hemp biomass processing, extraction, formulation and refining and a 27,000-square-foot hemp biomass processing and storage facility
• HTC is finalizing interior work to make the extraction facility GMP Euro compliant and expects to begin receiving new extraction equipment at the facility next month
• The company closed a bought deal agreement last month that will inject $10 million in funding into the company’s operations

Saskatchewan, Canada-based cannabinoid refining innovator HTC Extraction Systems (TSX.V: HTC) is anticipating the arrival of its initial new extraction equipment next month at the company’s recently completed 19,000-square-foot facility in Port Lajord, 17 miles southeast of Regina’s metropolitan commerce center.

Installation of the extraction and formulation equipment will mark the next major stage for the company’s strategy of building on hemp biomass tolling contracts on both sides of the U.S.-Canada border to extract CBD full spectrum oil (FSO) and to keep a percentage of the distillate for future sales and offtake agreements, including sales to the cannabinoid pharmaceutical market. Bought deal private placement financing that closed last month is injecting aggregate gross proceeds of C$10 million into the venture (http://ibn.fm/r6kKF).

The Port Lajord facility has been designed to be one of the highest performance facilities in Canada for hemp biomass processing, extraction, formulation and refining, and interior work is ongoing to establish it as GMP Euro compliant. It will also house quality assurance testing and product development laboratories.

HTC has also completed the construction of a 27,000-square-foot hemp biomass processing and storage facility, which will be used to warehouse extraction-ready biomass.

The size of the facilities speaks to the volume of biomass the company expects to work with. Its existing operation includes a projected 5 million kilograms of hemp biomass from this year’s Saskatchewan harvest, using five varieties of Health Canada-approved cultivars as the genetic foundation. The June newsletter showed the arrival of a custom-manufactured hemp biomass dryer that is 50 feet long and 12 feet in diameter (http://ibn.fm/716Ag).

In August, with one million pounds of biomass harvested and 20 million pounds yet to go at one farm, the company reported the average compacted biomass bale is 1,600 to 1,700 pounds and is vacuum sealed in ultra-violet resistant wrapping to protect it prior to being processed (http://ibn.fm/3FN7V).

HTC is in late-stage negotiations with a 60,000-acre recognized Canadian farm leader who is a significant Identity Preserved Grown (IPGrow™) hemp biomass producer. The company intends to enter a tolling contract with the producer for the 2019, 2020, 2021 and beyond production crop years. The planned contract would be for about 4,300 acres from the 2019 crop, up to 25,000 acres for the years after that.

The company also is in late-stage negotiations to acquire a U.S.-based, fully licensed hemp processing, extraction, formulation and distribution operation that would begin extracting in January 2020 that would also function with IPGrow hemp biomass tolling contracts in the United States for the 2020 hemp production growing year.

Over the course of 14 years, HTC has developed and subsequently improved on proprietary systems for biomass, gas and liquid extraction, built on distillation processes for ethanol and ethanol-based solvents used in the extraction process. It expects to use its related entity, Purely Canada Foods, to sell and distribute its CBD and other cannabinoids to Purely Canada Foods’ customers under the brands Purely Canada Hemp, Purely Canada CBD, Purely Canada Cannabinoids and Purely Canada THC.

For more information, visit the company’s website at www.HTCExtraction.com

NOTE TO INVESTORS: The latest news and updates relating to HTC are available in the company’s newsroom at http://ibn.fm/HTC

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