Polysilicon Plant to be Established at Al Jubail Industrial City 2 by First Energy Bank and PMD

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Researched by Industrial Info Resources (Sugar Land, Texas)--The First Energy Bank (FEB) (Manama, Bahrain), an Islamic investment bank dedicated to alternative energy sources, in conjunction with the Saudi Arabian Project Management Development Company (PMD) (Jubail Industrial City, Saudi Arabia), is to develop a world class polysilicon plant at the Al Jubail Industrial City 2, the first of its type and size in the region. The project, estimated to be worth $1 billion, will be financed through 60% debt and a 40% equity stake. A portion of the debt will be provided by the Saudi Arabian government, with the remainder coming from commercial banks.

The plant will produce around 7,500 tons per year of high quality polycrystalline silicon, often known as polysilicon. Polysilicon consists of multiple small silicon crystals and is used in the production of solar panels. The proposed plant will cover a 375,000 square meter site in the industrial city and is scheduled to start production in 2013. In a later phase the plant may be used to produce ingots, cells, wafers and modules.

The development of the plant is in line with the Saudi Arabian policy to develop sustainable energy solutions and reduce oil consumption. It is expected to generate further opportunities in the downstream solar energy chain. The Gulf Arab region in general is attempting to capitalize on solar and wind energy, with Kuwait planning to open a tender process next year for a solar plant designed to provide up to 5% of its energy needs and Saudi Arabia planning a 2 MW plant at the King Abdullah University of Science and Technology.

The project, which will be jointly managed by PMD and Cosmos Industrial Investment Corporation (Manama, Bahrain), a subsidiary of the FEB, which has already achieved significant progress, with market and technical studies completed and the securing of the site in the industrial city from the Royal Commission for Jubail and Yanbu.

An electricity supply agreement has also been arranged with the Saudi Electricity Company (SAU:5110) (SEC) (Riyadh, Saudi Arabia) and the FEB and PMD have signed a take-off agreement with the United States based Vinmar International Limited (Vinmar) (Houston, Texas), which covers most of the planned production from the plant.

The proposed plant will use conventional advanced and commercially proven technologies to produce the polysilicon and is expected to be one of the lowest cost polysilicon plants in the world. The majority (75%) of the world's polysilicon is produced in the United States and Japan, by companies such as Hemlock Semiconductor Corporation (Hemlock, Michigan) and the Mitsubishi Corporation (TYO:8058) (Tokyo, Japan), although China is expected to become a major producer in the near future as it focuses on renewable energy sources.