REC Silicon ASA - Unresolved U.S./China Solar Trade War Will Force Shutdown of Remaining Moses Lake Capacity
Fornebu, Norway - [September 22, 2015]: REC Silicon ASA (REC Silicon) anticipates that if the solar trade war continues and the 57% duty on its solar grade polysilicon imports into China remains, a complete shutdown of its remaining production capacity in Moses Lake, Washington U.S.A. will be required, and approximately 400 out of the current 720 employees will have to be laid off.
Tore Torvund, REC Silicon's CEO said, "REC Silicon was brought into the solar trade war in retaliation for a dispute regarding imports of solar panels from China into the US. Now there is a resolution deal on the table between the U.S. and China that would provide Chinese panel companies with valuable market access in the U.S. provided that at solution can be found also for US polysilicon. A global resolution of both the Chinese solar panels and U.S. polysilicon trade barriers provides enormous benefits for the whole of China's dynamic and rapidly growing PV industry. We do not understand why China has not yet seized this unique opportunity for a mutually beneficial solar trade resolution, which would give China substantial financial returns. Despite numerous negotiations, the polysilicon dispute is still unresolved. It is perplexing that Chinese polysilicon makers, who claim to have highly competitive production costs and only have capacity to serve less than half of China's growing polysilicon demand, could jeopardize the global resolution of the entire U.S. and China solar trade war. It is particularly baffling when additional competitive polysilicon supply is needed in China if its leading PV industry is to expand to its full potential to meet the world's increasing demand for solar energy. As we understand it, there will be no resolution on Chinese solar panels imported into the U.S. without a deal providing reasonable market access for U.S. polysilicon into China."
Little progress has been made on resolving the part of the solar trade war that adversely impacts solar grade polysilicon manufactured in the U.S., despite an enormous amount of recent work by numerous parties, led by U.S. Trade Ambassador Froman. This despite the fact that the White House, Chinese solar industry associations including CCCME, and affected Chinese and U.S. PV companies have recently made significant progress towards a deal which would resolve the solar panel trade dispute between the U.S. and China. However without a solution also for polysilicon, there will be no resolution of the trade war. Washington Governor Jay Inslee and U.S. Senators, Patty Murray and Maria Cantwell, have also been actively engaged in obtaining a global resolution to the solar trade war.
REC Silicon remains hopeful that China will proceed to make a deal on U.S. polysilicon in connection with the current opportunity for a global resolution of the solar trade war, which creates substantial value and multiple benefits for China.
REC Silicon's FBR polysilicon production process uses 90% less power to produce its polysilicon than the traditional Siemens process, which is currently still utilized across the majority of the polysilicon manufacturing industry. As a result, REC Silicon is the world's lowest cost producer of high quality solar grade polysilicon.
For further information, please contact:
Francine Sullivan, VP Business Development and Legal
REC Silicon ASA
Phone: +1 509 750 1133
Nils O. Kjerstad
Phone: +47 9135 6659
About REC Silicon
REC Silicon is a leading producer of advanced silicon materials, delivering high-purity polysilicon and silicon gas to the solar and electronics industries worldwide. We combine 25 years of experience and proprietary technology with the needs of our customers, and annual production capacity of more than 20,000 MT of polysilicon from our two US-based manufacturing plants. Listed on the Oslo Stock Exchange (ticker: REC), the company is headquartered in Moses Lake, Washington and employs approximately 720 people.
For more information, go to: www.recsilicon.com
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.