Vitalis Extraction Technology staff. Photo: Contributed

B.C. business makes a mint on cannabis extraction equipment

Vitalis Extraction Technology first in Canada cannabis industry to earn ASME certification

An Okanagan company is the first in Canada to earn certification from the American Society of Mechanical Engineers for its manufactured cannabis extraction equipment.

Vitalis Extraction Technology is marketing its product and manufacturing base beyond just Canada, to the U.S., South America and Europe.

Since it started up three years ago Vitalis has grown from 20 to 60 employees with plans to consolidate all of its business locations around the city into a 40,000 sq.ft. facility near the Kelowna International Airport at a cost of $10 million.

Vitalis is on track for a 105 per cent increase in sales this business year.

READ MORE: SALES LICENCE FOR KELOWNA CANNABIS PRODUCER

Pete Patterson, co-owner of Vitalis along with partners Joel Sherlock and James Seabrook, said their sudden growth is a reflection of the “wild west” excitement surrounding the legalization of cannabis globally.

Patterson said while examples of legalization are being studied carefully in Colorado, California, Washington and Oregon, he said other countries are watching how Canada benchmarks the industry foundation on a nation-wide level.

From the outset, Patterson said he and his partners surveyed the industry to find a marketing niche for their CO2 extraction product design, which was created by Seabrook, part of the first UBC Okanagan mechanical engineering graduation class.

He said they settled on focusing on large-scale production given the competition on the smaller end. They chose to provide a product that was reliable and would ultimately would pass ASME certification and that was also geared to hash oil extraction.

The extraction market equipment is based on petroleum-based solvents such as butane and propane along with CO2 natural products. These solvents are exposed to extreme temperatures and pressures, they display structures that fluctuate between intermediate states of solid, liquid and gaseousness.

He said the potential for consumer demand has brought retailers to them with demands to process up to one million pounds of product a year.

Patterson said the fast and unstructured growth of the manufacturing equipment supply side has presented some massive additional costs.

He noted Alberta, B.C. and Ontario all have slightly varying regulatory rules for cannabis extraction equipment, something that Vitalis has taken pains to meet with their equipment, and something other competitors do not.

READ ALSO: FUTURE UNCERTAIN FOR VANCOUVER POT SHOPS

“I heard one story of two organizations that purchased equipment out of Europe that cost $600,000 and required a further $300,000 to meet certification standards, and an Ontario licensed producer bought a system that required a further $250,000 in upgrade costs,” he said.

“If you don’t bring it up to specs it becomes nothing more than a paperweight. That’s why certification was important to us, as we wanted to stand behind our product.”

But for all the enthusiasm about legalized marijuana business sales revenue, Patterson acknowledges there are similarities to the potential extolled about Internet product investment in the 1990s which led to many companies going bankrupt after securing stock market investment.

“We want to be mindful of what happened when that bubble burst in the mid-90s so we are looking to off-set or revenue stream reliance on the cannabis industry by looking at product development in other areas such as oil and gas industry and mining,” he said.

READ ALSO: B.C. TO STILL ONLY HAVE ONE STORE SELLING POT WHEN LEGALIZATION ROLLS AROUND

Patterson said while he and Sherlock came here from larger cities and Seabrook opted to remain here after graduating from UBCO, he said they believe Kelowna has become an ideal location to base a company with global sales aspirations.

“We thought about locating to larger cities like a Toronto, Vancouver or Edmonton, partly because land is cheaper and more available. But we continued to gravitate back to being in Kelowna. And we have found since it allows us to recruit expert talent because of the lifestyle here, and on the manufacturing side of equipment components we have ready access to a supply chain to help meet our metal and electronics needs.”



barry.gerding@blackpress.ca

Like us on Facebook and follow us on Twitter

Just Posted

Bike helmets, tools donated to Santa’s Workshop

Cross Canada Cycle Touring Society and Canadian Tire embraced the season of giving

Annual labyrinth walk welcomes the festive celebration of lights season

Take a break from the commercial activity of the holiday season and… Continue reading

Strong winds to hit B.C.’s south coast

Western regions may see winds of up to 80 km/hr

Courtenay family looking for help after baby born two months premature

A GoFundMe page has been set up as a difficult pregnancy and a long stay in Victoria have left the family struggling to get by

VIDEO: Ex-NASA engineer pranks mail thieves with glitter bomb trap

Package thefts are common this time of year, but YouTuber Mark Rober used his engineering skills

Bear cubs try to take Vancouver Island woman’s Christmas cookies

Incident happened in the early-morning hours today, Dec. 18, in Nanaimo

FortisBC says you can return to normal gas use following pipeline fire

Utility says increased pipeline capacity, warmer weather have allowed supply to reach normal levels

CSIS collected info on peaceful groups, but only in pursuit of threats: watchdog

Security Intelligence Review Committee says fears unjustified after reviewing evidence, testimony

Canada ranks 16th on annual gender gap list

This is the second year Canada has placed 16th in the World Economic Forum’s list

VIDEO: Tornado rips through city west of Seattle

Reports indicate five to seven homes damaged in Port Orchard, Wash.

Trial date postponed for man charged with killing Abbotsford police officer

Oscar Arfmann’s trial pushed back from January to May 2019

Privacy watchdog says legal cannabis buyers should use cash, not credit

Some countries could bar entry to individuals if they know they have purchased cannabis

‘A start:’ Alberta critical of Ottawa’s $1.6B package for ailing energy sector

A further $150 million is to be used for clean growth and infrastructure projects

Most Read