On March 19, 2019 Chemesis International (CSI.C) announced a partnership with First Medical Cannabis, for exclusive cultivation of CBD-rich hemp in Puerto Rico.

To close this deal, Chemesis will issue 1 million shares and additionally grant an option to purchase 1 million shares of CSI stock for a period of 24 months, at a price of $2.12.  CSI is currently trading at $2.03.

CBD – a non-psychoactive cannabis compound – is derived from both marijuana plants and hemp. It is gaining traction in the health and wellness sector for treating a wide array of ailments including chronic pain, arthritis and depression.

Puerto Rico is a country that could some of the restorative powers of CBD.

A year after Hurricane Maria devastated the island, the locals are still struggling with poverty, lack of services and high unemployment.

In fact, medical recruiters from the Ozarks have been recruiting nurses in Puerto Rico to travel back and work in the Ozarks.  While America faces a chronic nursing shortage Puerto Rico has the opposite problem: too many qualified workers and not enough jobs.

In addition to the high unemployment rate, mental health remains an urgent problem in Puerto Rico.

Almost 60% of the island’s population experience anxiety and fears. According to the Save the Children Fund, several months after Hurricane Maria, some parents considered killing themselves in front of their children.

Chemesis has 4 main branches of operation:

  • Cultivation:  grow facility in Puerto Rico with 30,000+ lb overall grow capacity. Grow opportunities currently under review in California.
  • Manufacturing: extractions, formulations & products, specializing in BHO, Alcohol & CO2 extraction with the current capacity of over 2000 lbs of raw material a day.
  • Distribution: with new regulations impacting the California market, CSI aims to be a fully compliant distributor. In Puerto Rico market, CSI serves the entire island from seed to sale.
  • Retail:  Actively engaging retail storefronts in the California market while working to open branded shops in multiple marketplaces.

With the First Medical Cannabis deal, Chemesis will be able to cultivate high yield CBD derived from hemp on a large scale for distribution on the island and the mainland USA.

Chemesis will initially have access to 1,000 acres for hemp cultivation, with the option to expand up to an additional 5,000 acres – creating a total potential of 6,000 acres of prime agricultural estate.

Chemesis also has a fully compliant facility in Puerto Rico “to manufacture, process, and distribute hemp-derived CBD products.”

The Puerto Rican facility has the ability to off-take all hemp produced by First Medical, and process into finished goods for sale in domestic and international markets, including the continental United States.

First Medical holds one of the largest privately-owned land estates in the Valley de Lajas, Puerto Rico. Located to the south of the Santa Marta hills, Valley de Lajas is one of the most agriculturally prolific regions in the Caribbean.

Puerto Rico has a competitive advantage for cannabis and hemp cultivators as the climate, soil, and geographical region allow for a longer growing season.

“Since the last of Puerto Rico’s sugar mills closed in 2000, the island has been in need of an agricultural revolution and the hemp industry promises much needed jobs,” stated Chemesis CEO, Edgar Montero. “Puerto Rico’s tropical climate makes the island an ideal competitor in the hemp industry, furthermore it will allow the Company to harvest up to 3 crops per year compared to 1 in many areas around the world.”

CSI is collaborating with filmmaker Kevin Smith and “Silent Bob”.

Equity Gury’s Chris Parry considers Kevin Smith “One of the top three best endorsement targets (for a cannabis company) in the world today.”

@jayandsilentbob used to sell weed in the movies,” wrote Mr. Smith in recent Instagram post, “Now, thanks to the good folks at @chemesis.tv , Jay and Silent Bob are selling weed in real life!

If you are thinking, “Chemesis has a lot of moving parts” – you are dead right.

Last week, we reported that Chemesis received its Colombian seed producer license, a crucial step in its goal to take Colombian cannabis global.

“The Seed Producer License not only allows the company to grow and harvest, but import and export cannabis derivatives and seeds,” stated Edgar Montero, CEO of Chemesis.

Two weeks ago, we reported that Chemesis has “entered into a binding agreement to acquire 100% of a fully-operational extraction and manufacturing facility in Cathedral City, California.” The new fully licenced state-of-the-art facility is projected to double CSI’s current capacity.

On January 17, 2019 we reported that Chemesis has entered into a licensing agreement to produce Dragonglass (Flake & Bake) in Puerto Rico.

Dragonglass is patented THC powder or flake. It promotes consumption of cannabis in a variety of different methods, flavors and colors.

The powder/flake is produced via a “water-based cannabinoid infusion method”.  One of the key features of Dragonglass is that the effect can be felt within 7-15 minutes.

Dragonglass is a base-line ingredient – like flour or yeast- from which 100s of different culinary products can be manufactured.

“Chemesis has begun cultivating high potency CBD strains and will leverage its licenses and registered seed strains to develop high quality crops,” stated Montero in reference to the March 19, 2019 news, “With the passing of the 2018 Farm Bill, we have the necessary assets and strategic relationships to cultivate, manufacture, and ship finished goods across the United States.”

Full Disclosure:  Chemesis is an Equity Guru marketing client, and we own the stock.

Written By:

Lukas Kane

Lukas Kane was previously the CEO of a North American investment news syndicate. He was also the Communication Director for a consortium of publicly traded companies. A Senior Writer at Equity.Guru, Mr. Kane writes about mining, cannabis, energy, technology and biotech.

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