REC Silicon expects expansion decision in spring

Hartmann addresses GCEDC quarterly membership meeting

MOSES LAKE — Tucked within the presentation of Solar Grade Silicon's president, there lay an update on a possible expansion to its facilities in Moses Lake.

"Moses Lake is currently being considered as the primary site," said Tor Hartmann, president and CEO of REC Solar Grade Silicon. "It's not totally a done deal yet. A lot of factors need to go into the decision on whether the project is approved, but right now, Moses Lake is definitely in the lead role here."

Hartmann addressed members of the Grant County Economic Development Council during their quarterly meeting, held at Big Bend Community College's Advanced Technologies and Education Center Monday afternoon.

Of the expansion, which includes production of 6,000 metric tons of silane and 4,000 to 5,000 metric tons of granular material, new by-product processing areas and centralization of control rooms, Hartmann said preliminary estimates of new production facilities would cost $365 million, upgrades of existing facilities $27 million and front-end engineering to obtain budget estimates about $5 million.

The expansion would bring an estimated 75 new jobs and generate about $5 million in property taxes, with the construction phase bringing what Hartmann called "a significant cash flow" into the community. The Moses Lake site is the primary design basis for the front-end engineering, he added.

Front-end engineering began in October, Hartmann said, and a budget estimate is expected for March 2006. Procurement of items will begin in the spring, site preparation in the fall and heavy construction will start in the spring of 2007, targeting completion in December 2007, and beginning start-up and commission of the facilities in spring 2008.

"Final project approval will depend on the project economics," he said, "which means what is the market doing, what is the price of the product, what are forecasts, engineering estimates of how much the facility's going to cost and then finalization of site investigations."

A final decision is expected in March or April 2006, Hartmann said.

When asked by an audience member what those in attendance could do to help, Hartmann noted that he would be visiting Gov. Christine Gregoire today, and joked that a couple phone calls might help.

"We've been working very close with local officials, and we don't have any doubt that the local governments and businesses would like to see us grow here in the community," he said. "We've just got to keep after some of these awards and grants and communicate with the right officials at the right level, and I think we're maybe going to do some of that tomorrow."

Hartmann also provided an overview of the photovoltaic industry worldwide and the istory of his company in Moses Lake, from its launch in 1984 to the purchase by Renewable Energy Corporation (REC) earlier this year. REC Silicon, Inc. has REC Solar Grade Silicon and REC Advanced Silicon Materials, Inc., in Moses Lake.

"Basically, the way we're operating is one company, two plants," Hartmann explained, adding that about 250 people work in the company.

Before Hartmann's presentation, GCEDC executive director Terry Brewer provided a brief update on several projects

"It really has been a busy year, the busiest, in fact, by far in the eight years that I've worked for the organization, as far as business activity," Brewer said.

In 2005, the GCEDC responded to 40 requests for proposals or direct inquiries seeking information about the community related to business projects.

Of those 40, two projects have been completed. In September, it was announced that Richards Brush Company will move manufacturing from Seattle to Moses Lake. The company, presently at work on their facility, expects to employ up to 20 people, Brewer said. The GCEDC also worked with General Dynamics on an expansion, he added.

"We continue to work very closely, almost on a daily basis, with 13 of those 40 — three of those in fact so active that they have already purchased land," he continued. "They're not ready to announce a project yet. We're still working with them on that, but they do own land in the community now, since we started working with them. Three others that we're working with have signed purchase agreement options on property, so that shows a significant intent as well."

Brewer said that the 13 projects would add up to more than 1,000 jobs if they all came and all were at the scale that they were talking about, and more than $600 million in capital investment.

"We really are working on some heavy stuff," Brewer said. "It's all good stuff, there's not a scary thing in it in my opinion. They're all good companies, good projects and we'll continue to work hard with our partners … and look forward to more success in 2006. I really do think we'll have some good announcements in 2006."