Nextleaf Solutions Ltd (CSE:OILS) (OTCMKTS:OILFF) (FRA:L0MA) announced Thursday that it had struck an extraction deal with a premium white label flower producer in Canada and has also been awarded a patent in Mexico, which is set to become the largest legal cannabis market in the world, based on population.
In a statement, the cannabis extraction specialist said its subsidiary, Nextleaf Labs Ltd had struck the extraction deal, which will see the client, a licensed producer in Ontario, supply it with biomass to be processed into distillate.
READ: Nextleaf Solutions says subsidiary Nextleaf Labs strikes cannabis extraction deal with Natural MedCo
Nextleaf Labs will retain a portion of the resulting bulk THC distillate. It wholesales THC and CBD oils through its 'commercial partners program' and provides cannabis extraction services.
The initial term of the agreement with the client will end after 12 months, or when 1,000 kilograms of marijuana have been processed, whichever comes sooner.
"We are pleased to have the opportunity to support our distribution partner's cannabis 2.0 product launches across Canada by supplying high-purity distillate," said Nextleaf's chief financial officer (CFO) Charles Ackerman in a statement.
Also in the statement, Nextleaf said the Mexican Institute of Industrial Property had granted it a patent for the company's foundational process for producing high-purity cannabinoid distillate.
"This latest patent validates our technology and further reinforces our vision of developing intellectual property that improves CBD and THC oil economics globally," the company said.
The Mexican Senate passed a bill last week to legalize adult-use of cannabis and the pending law requires the country's president Andrés Manuel López Obrador to sign the bill into law, which will make Mexico the third country to legalize adult-use cannabis, following Canada and Uruguay.
The company also noted that, amid the COVID-19 pandemic, it had postponed this year's annual general meeting (AGM) of shareholders until spring 2021 and will provide further updates in due course.
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