Trays of newly introduced mother plants at the Aurora Sky facility on February 5, 2018 at the Edmonton International Airport. Shaughn Butts / Postmedia

By GRAHAM HICKS

(Second of a three-part series on the ramifications of legal pot)

Welcome to the green gold rush.

In just a few months, Canada will be the first developed country in the world to fully legalize the growth, distribution and consumption of all cannabis products.

A Deloitte study suggests recreational marijuana sales alone could be as high as $8.7 billion per year in Canada – like the sale of all alcoholic beverages (besides beer), and that’s just a start. Add all the support business (security, transport, processing, research) and the potential economic impact “approaches $23 billion.”

Everybody’s speculating in this market which, other than medical marijuana, has yet to sell a penny of government-approved pot.

The numbers around Aurora Cannabis, soon moving its headquarters from Vancouver to Edmonton, are mind-boggling.

Aurora and Canopy Cannabis are currently Canada’s two top publicly traded pot companies.

The first wave of the “green gold rush” happened back in January. Investors decided the Canadian government was serious about legalizing cannabis in 2018. The rush was on.

After years of trading as a penny stock, Aurora hit a high of $15 in January.  It’s now down 35% off that high, but still has issued 550 million shares, trading this week at around $8.40. Aurora’s “market capitalization”, i.e. the money investors have plowed into the company, is currently $4.6 billion.

This is happening before tobacco and liquor companies come on board. According to their own rules, such companies are not allowed to invest in anything illegal. Until Canadian pot is officially legal, it is illegal.

Likewise, major institutional investors like pension funds are sniffing around, deciding when and where to place their bets in this brand-new industry.

Cash-rich, Aurora has been building pot-growing facilities – The Aurora Sky 800,000 sq. ft. greenhouse at the Edmonton International Airport industrial park, an additional 1.2 million sq.-ft. greenhouse operation in Medicine Hat – and much, much more.

In January, Aurora bought Saskatoon-based medical pot company CanniMed for $40 a share, or $1.1 billion. Ten months previously, CanniMed shares were trading at $10.

Then, this month, Aurora bought another medical pot company, MedReleaf, for an astonishing $3.2 billion.

Aurora, founded and still run by Edmontonian Terry Booth, really likes Edmonton. It keeps buying shares in local, current-and-future pot-related companies, like Liquor Stores N.A. (Liquor Depot) which is changing its name to Alcanna. Alcanna has plans – pending permits — to sell pot as well as booze in separate stores.

Aurora bought into local hemp (non-intoxicating pot plants) producer Hempco, which is also moving headquarters from Vancouver to Nisku. Aurora acquired a minority interest in Radient Technologies, a local bio-tech company with a proprietary process for producing cannabis oils.

Much to the happiness of landlords, the fight for prime marijuana retail space is intense and equally speculative, given neither the Alberta Liquor, Gaming and Cannabis Commission nor the City of Edmonton have yet to issue any permits or licenses. It’s expected that many applicants will not receive the necessary permissions.

Nonetheless, prime retail space leases are being signed by potential marijuana retailers – again no permits have yet been issued – at $75 a square foot according to future-marijuana retailer Fire & Flower VP Nathan MIson.  By comparison, liquor stores in prime locations pay about $30 a square foot.

Thanks to Aurora and other growers setting up operations here, Edmonton is fast emerging as one of the top pot centres of Canada.

Similar to Nisku’s oilfield service industries, the services needed by cannabis companies will be as wealth-creating as pot itself.

For instance, local start-up company, DriveABLE has partnered with the RCMP to develop road-side testing for impairment of all kinds – pot, alcohol, fatigue …

Surprisingly, the University of Alberta has made no major announcements regarding cannabis research. You’d think university researchers would seize the opportunity, especially given the engineering and business departments’ success in partnering with the oil and gas industry.

Complicating the picture is supply and demand. Most analysts say the market will be seriously under-served in its first two years, as growers ramp up.  But after two years, there’s likely to be an over-supply of legal pot. Prices could crash.

Overall, the green gold rush is great for Canada, great for Edmonton.

As the first country to legalize cannabis, Canadian technologies and techniques and regulatory frameworks will be “first to market” the world over – including the USA, where nine states have legalized pot, but the federal government has not.

“The legalization of cannabis,” says Fire & Flower’s Mison. “Is one of the biggest economic opportunities of contemporary times. And for once, Canada has the lead.”

(Next week, cannabis regulation in all its bureaucratic glory.)