Local distillery joins fast-growing industry

By Josh Aldrich, Camrose Canadian

Friday, May 12, 2017 11:35:23 MDT AM

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Back 40 Distillery co-owner Lorne Haugen shows off their two spirits they produce, Winter Time Frost Vodka and Ol’ Apple Betty in Camrose on May 5. Josh Aldrich/ Camrose Canadian

Camrosians have a new local option to quench their summer thirst. 

The Back 40 Distillery had a soft launch this winter but on Saturday they will be officially open for business, as the latest distiller to join a fast-exploding Alberta craft industry. 

The distillery is five years in the making and is the brainchild of two long-time friends, Lorne Haugen and Rick Lazaruik. The idea came to them, like so many good ideas, over homemade sausage and a drink at Haugen’s farm. 

“One evening we were sitting around having a cocktail and we looked at the label, we got talking and said ‘You know we could probably make this stuff,” said Haugen, who is a full-time federal food inspector. 

That idea turned into a long venture to get to today. First they headed off for a distillery course in Denver, then had to secure the proper licensing and finding a building that fit their needs to be able to distill, distribute, store and sell from their storefront. 

The end result is two very distinct spirits, Winter Time Frost Vodka and Ol’ Apple Betty, which tastes like a liquefied apple pie. They have been perfecting the recipe for about three years, and have ensured their own personalities are built into the drinks, right down to the home-spun labels and the retro bottles. 

Haugen, however, says to keep an eye out for seasonal products that will be coming down the line, including a vanilla flavoured and raspberry flavoured Winter Time Frost. 

In 2013, the Alberta Gaming and Liquor Commission eliminated the minimum production requirements for liquor manufacturers, allowing small craft producers more easily into the market. Most craft distillers produce under 100,000 litres a year, the previous minimum was 600,000 litres a year. 

Before this change there were three distilleries in Alberta, now there are 16. By comparison, there were 19 breweries or brew pubs in the province prior to the change in requirements, now there are 54 — two of those also produce spirits. 

In the 2015-16 fiscal year, liquor sales hit $2.6 billion in Alberta and brought in $856 million of revenue to the government. 

There are three other distilleries in the Edmonton area: Rig Hand Distillery in Nisku, Red Cup Distillery in Vegreville, and Strathcona Spirits Distillery. Camrose is also home to the Norsemen Brewing Company which produces a selection of craft beers. 

Following the release of the provincial budget, Alberta Finance Minister Joe Ceci said the government is working on a similar program for craft distillers as there is for craft brewers in the province. In August of 2016, the province replaced their increased taxation of craft breweries from outside of Western Canada by taxing all beers in Alberta at the same high rate. They also created a grant program that rebates Alberta breweries based on how much volume they sell.

The province has received multiple constitutional challenges over their tax and refund programs for small breweries, with the complaints claiming it puts out of province Canadian breweries and importers at a disadvantage. The Canadian Constitution Foundation is in support of one such complaint by Calgary owned importer Artisan Ales, while Steam Whistle Breweries in Ontario and Great Western Brewing Co. out of Saskatoon have also filed challenges.

If a distilling program is successfully created, however, it will only ignite the Alberta craft distillery industry further. 

“It’s going to allow us to recapitalize on our distilleries and invest more heavily in our equipment and expand as quickly as possible,” said Alberta Craft Distillers Association secretary and general manager at Parks Distillery in Banff Stavros Karlos.  

Distillers have a much higher start-up cost than a brewery, as they have to build a brewery to create their distiller’s wash and then a distillery on top of that. According to Karlos, the cost is about 2.5 times higher than a small brewery for capital expenditures. 

Karlos says the industry is perfectly located in Alberta with the agriculture industry to become one of the premiere distilling regions in the world. He says barley is already being exported to Scotland to meet the scotch industry’s demands, while Alberta rye growers are considered some of the best in the world.  

“Consumers are demanding locally handmade products and products they can relate to,” he said.

“For Alberta distilleries, that linkage between us and the farmers is absolutely paramount to everything we do.” 

Karlos said the industry is set to take the next jump of distilling into the sale of whiskey, what he considers the province’s drink of choice. The trick with whiskey is it has to age for at least three years in a keg before it is fit for sale. It is a large long-term investment for distillers, but he says it is one many are making. 

“I can assure you, almost every single one of us is barrel-aging as much whiskey as we can right now. In about three years from now, you’re going to see at least 10 fully-aged Alberta whiskies in the market.” 

Back 40 is not producing whiskey yet, but it is part of their big picture plan down the road. 

The Back 40 distillery has the capability of producing three to four cases of vodka or six to eight cases of Apple Betty in one batch, though have several batches in production at a time. It takes a week-and-a-half to two weeks to properly distill one batch. 

Though it is early on, Haugen is already looking for ways to increase the business and production. 

“We would like to expand, there’s a bay next door we could move into and we could do events like birthday parties, even small weddings,” he said. 

The distillery is located at 4701-36 street and their grand opening will go at 11 a.m. on Saturday with a ribbon cutting. Back 40 products are available in five Central Alberta liquor stores and two restaurants in the area.