NEW BID TO START HEMP PLANT IN DAUPHIN

Will Process Fibres Into Green Insulation

FOR the second time in almost 10 years, efforts are underway to
develop a multimillion-dollar hemp processing plant in Dauphin.

Parkland BioFibres Ltd. is looking to build a $14-million raw
industrial hemp processing operation to make building insulation.

The 50 members of the Parklands Industrial Hemp Growers Co-Op have
committed $2 million to the project and promoters are seeking another
$3.3 million from private investors.

Hemp is seen as an excellent environmental and functional alternative
to pink Fiberglas insulation. The Dauphin plant also plans to produce
non-woven matting for use in the horticulture industry, fibre for the
paper recycling industry and short fibre for horse and pet bedding.

Don Dewar, chairman of Parkland BioFibre Ltd., said the group has
already secured a $3-million operating grant from the federal
government through Sustainable Development Technology Canada and the
province has given conditional approval for a $3-million loan once
the rest of its financing is in place.

About $500,000 has already been raised from investors and Dewar said
he is hopeful the rest of the required capital will be found.

"This will be the first commercial hemp fibre processing plant in
North America," Dewar said. "We think there is growing interest in
these kinds of products."

The insulation made from hemp has several desirable qualities
including the fact it is made from a renewable raw material. There
are producers and a market for the product in Europe, but Parkland
BioFibre will be the first to make and sell it in North America.

"But we believe the market will develop and we want to have the plant
up and running to take advantage of that," said Dewar.

In addition to the $6 million from the province and federal
governments, the City of Dauphin has made available a $300,000 piece
of land in the industrial park that was created for the ill-fated
Ranchers Choice cattle processing plant that was recently shelved.

In 1999, one year after it was made legal to produce non-THC hemp as
a commercial industrial crop in Canada, a California outfit called
Consolidated Growers and Processors Inc. tried and failed to build a
$25-million hemp processing plant in Dauphin. (THC is the active
ingredient that produces the "high" derived from illegal
marijuana/hemp plants.)

Parkland BioFibres is taking a more modest approach and it has a
ready-made group of growers who were originally organized to supply
the failed California operation. But like any greenfield operation
attempting to create a brand-new market, there are obvious risks.

"We think it is good for the region and we want to contribute in
getting it off the ground," said Jason Yates who is a partner in the
11-store McMunn & Yates Building Supplies chain. "There is a huge
push in the building industry to go green so there ought to be some interest."

McMunn & Yates are committing to stocking the hemp insulation when it
comes out, even though that market is dominated by large
multinational players like Johns Manville and Owens Corning.

Dewar said the plan is for the plant to be operational in 2008 and
profitable by 2010.

Mike Fata, president of Manitoba Harvest Hemp Foods & Oils, one of
the largest North American suppliers of nutritional and food products
made from hemp seeds, said the fibre processing operation is a great idea.

"The more hemp grown, the better as far as we are concerned," he said.