HALIFAX -- Nova Scotia has kindled an explosion of spirit makers -- there are now 16 in Canada's second-smallest province -- through attractive craft-distillery policies and collaborations with local farmers.

The Nova Scotia Liquor Corporation says 12 of those distilleries have popped up in the last five years, serving rum, gin, vodka and other spirits.

Pierre Guevremont, co-owner of Ironworks Distillery in Lunenburg, N.S., says Nova Scotia is a leader in Canada in terms of its policies for craft distilleries, along with B.C. and Saskatchewan.

He says distilleries are offered favourable margins when selling their product in provincially run liquor stores, and are offered an additional markup reduction when 100 per cent of the agricultural products used in the alcohol are grown in Nova Scotia.

Guevremont's boutique and micro distillery received a $159,748 repayable loan today from the Atlantic Canada Opportunities Agency to expand and modernize its production facility in the picturesque port town, home of the famed schooner Bluenose II.

The Crown liquor corporation says people in the province are enjoying local spirits -- sales were up 85.2 per cent during the second quarter of its fiscal year from July and October 2017, reeling in $1.6 million.