REC expansion delayed two months

MOSES LAKE - A $660 million project currently ongoing in Moses Lake is experiencing some delays.

Renewable Energy Corporation began its project to build a new polysilicon plant at its REC Silicon location in Moses Lake in October 2005. The project broke ground in August 2006, and REC Silicon Senior Vice President Tor Hartmann said the target for the project's end is still late July.

REC stated mechanical completion of the plant will most likely be delayed by approximately two months, and commercial production is now scheduled to start late in the fourth quarter of 2008.

Hartmann primarily attributed the delay to delays in equipment deliveries. REC and its contracting partner, Fluor Corp., stated that the cost estimate for the new plant will have to be increased by close to 20 percent from the $660 million originally communicated.

"This is a new technology and we have design development costs as we go through and get to the details," Hartmann explained. "Due to the late equipment deliveries, we need to keep the construction effort longer and have as many people here at considerable expense. That's really the primary driver is schedule extension due to late equipment deliveries."

Hartmann said the impact to the production target of 8,000 metric tons is still being determined.

"We're working on close coupling our start-up schedule with our construction schedule and trying to compress that as much as possible," he said. "We still have a fair amount of work. We'll probably be a little short in 2008 from our production, but 2009 ought to be just fine."

The delay may have some effects on the other organizations within REC depending upon material coming from the new construction, Hartmann said, including REC Wafer and REC Solar, Hartmann said.

For Moses Lake, "it means the construction workers are going to be around a little bit longer," Hartmann said. "But as far as the company, we're still proceeding as planned as far as hiring folks and getting the operations in place."

When taking a look at where other projects are going, Hartmann said REC Silicon is still doing "extremely well" with its project.

"There is a tremendous amount of work all over the world and the equipment shops are full," he said. "We've had to put a substantial amount of effort to keeping the deliveries as close as they are. But the project is still going pretty well when compared to other projects in the world. This is still one of Fluor's top projects; they're still very proud of the accomplishments of this job."

The plant is still proceeding with plans for the additional expansion following completion of the initial expansion, Hartmann said.