Merit Functional Foods Corp. has already broken ground on its new $65-million pea and canola protein production plant in the BrookPort industrial park in the northern part of Centreport only months after closing its financing.
The project, a joint venture between the three former senior executives of Hemp Oil Canada and Burcon NutraScience Corp., is one of the the largest greenfield developments in the city.
Merit acquired 8.5 acres in the industrial park — that was itself only created a year ago — and the construction plan has already expanded to 88,000 square feet, 30 per cent larger than was anticipated only a few months ago.
Ryan Bracken, co-CEO of Merit and the former vice-president of innovation at Manitoba Harvest (which merged with Hemp Oil Canada), said the development is being planned to allow for another 50,000-square-foot expansion.
Bracken said the Centreport location was decided on at least partly because of the fact that the plant will need to use about 300,000 litres of water per day and needed to be tied into the North End sewage treatment plant.
"We are going to be one the top 10 users of power in the city and one of the biggest users of water," Bracken said.
With the plant scheduled to be commissioned by the third quarter of next year, it will need to be supplied with about 20,000 tonnes of peas and canola. As production ramps up and if the expansion is pursued, Bracken said the raw materials requirement will go up to about 100,000 tonnes per year.
That is just shy of the 125,000 tonnes of yellow peas Roquette will need to feed its pea protein plant under construction in Portage la Prairie.
While the Roquette plant has been in the news for almost three years, Merit’s came together very quickly after the joint venture terms and financing was secured only two months ago.
Diane Gray, the CEO of Centreport, said a lot of time and effort went into the Team Manitoba approach in assisting Merit on determining a site and securing all the permits so that it has all the appearances of a fast-tracked development, in one sense. However, in another sense, it has been more than a decade in the making.
"This is a very significant development for Centreport," Gray said. "The capital investment required takes it to a fairly significant level not just for Centreport, but for Manitoba."
Johann Tergesen, the CEO of Burcon Nutrascience, said it has been working on the the nuts and bolts of what a large-scale production plant would look like for many years.
"One of the reasons we were able to move so quickly is that we were planning the production facility in Winnipeg long before we closed the deal. We had to plan exactly what plant to build and how much it would cost. That factored so heavily into the actual business discussion," he said. "So when we closed the deal, we were able to hit the ground running."
Burcon is a 40 per cent partner in the joint venture. Merit has an exclusive royalty bearing licence for Burcon’s technology.
Although the Merit enterprise is brand new, Burcon has been in the field for many years, developing different canola and pea proteins and talking to consumer packaged goods companies about how they might be able to use it as an ingredient in their various offerings.
"We would never have started this business without knowing there was significant interest out there," Bracken said.
"I can’t mention the specific names of the consumer packaged goods companies because we are under non-disclosure agreements, but they are large, large multinationals. They have told us directly that functionality-wise, taste-wise, purity-wise, there is nothing else out there that meets Burcon’s underlying technology."
And whereas Roquette’s products are targeted at the meat analog products like those made by the popular Beyond Meat, to which Roquette has been supplying for years from its plant in France, the kinds of proteins Merit will be producing are highly soluble and with a taste profile that will make it more focused on the beverage market.
When completed, Merit will require a staff of more than 80 people to operate the plant.
Although it is a newly formed entity, the experience of the partners is significant. Bracken’s partners at Merit (who are also the investors responsible for 60 per cent of the project) are Shaun Crew, the founder of Hemp Oil Canada, and Barry Tomiski, the former chief operating officer of Manitoba Harvest. Burcon NutraScience Corp., a publicly traded company based in Vancouver, has its roots in Manitoba and has operated its research lab in Winnipeg for 20 years.
"It is a perfect fit when you think of it, not the least of which is because we are all Manitobans," said Tergesen, who is from Gimli.
"It is so comfortable doing business with friendly Manitobans."
Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.