Hemlock investing $1B to expand polysilicon production

By Ann Steffora Mutschler, Senior Editor -- 5/2/2007

Polycrystalline silicon producer Hemlock Semiconductor Corp. said today it plans to invest up to $1 billion in the next four years to expand its facility located in Hemlock, Mich., expected to increase the company’s total annual output of polycrystalline silicon to 36,000 metric tons, an increase of 90 percent of the company’s current output.

The expansion is expected to start coming online in 2010.

Rick Doornbos, president and CEO of Hemlock said in a statement, “Our customers in the solar and semiconductor industries have a critical need for more of our materials. This is the largest expansion in the history of this industry.”

The expansion will add up to 17,000 metric tons of polycrystalline silicon suitable for both the solar and semiconductor markets.

This is the second major investment the company has announced in the past 18 months: In November 2005, Hemlock announced an expansion of nearly $500 million that is under construction, and on schedule to come on line in early 2008.

Hemlock is a joint venture of Dow Corning Corp. and Japan-based firms Shin Etsu Handotai Co. Ltd. and Mitsubishi Materials Corp.

The company reminded that in solar applications, polycrystalline silicon is the cornerstone material used to produce solar cells that harvest renewable energy from light rays.

Marie N. Eckstein, VP and general manager of Dow Corning’s advanced technologies and ventures noted, “The solar energy industry is growing at a tremendous pace. A readily available supply of polycrystalline silicon is essential to continued innovation in this promising alternative-energy industry.”

Further, the expansion is expected to generate up to 250 full-time jobs, and an equal number of contracted positions upon completion.

Additionally, there will be nearly 800 temporary local construction contractors needed while the expansion is constructed.

Dow Corning’s Midland site serves as a major supplier of raw materials to Hemlock, will receive an expansion and upgrades, which will include the hiring of additional employees. Dow Corning also said late last year that solar is now its primary focus.

Hemlock also said began a formal search for additional expansion options and locations mid-last year, and the Hemlock site was chosen for its next expansion as it provided the fastest time-to-market, lower capital costs, and the ability to leverage the company's skilled employee base.

Hemlock said it will also continue efforts to search for a potential new green-site location. A global search for the new facility remains a top priority project for the company as high demand for Hemlock Semiconductor's materials is expected to continue.

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