News

Simcoa Operations Pty. Ltd. in Australia, Shin-Etsu Chemical’s 100%-owned subsidiary company, has decided on a plan to double the production capacity of its silicon metal manufacturing plant in Western Australia.

Simcoa Operations’ present production capacity is 32,000 tons/year. With the first-phase expansion, it will increase its capacity by 16,000 tons/year, making for a total production capacity of 48,000 tons/year. The investment amount for the first-phase expansion will be ¥8 billion and its completion is scheduled for the end of 2011.

In the second-phase expansion, capacity will be further increased by 16,000 tons/year, and by the end of 2013, total production capacity is scheduled to become 64,000 tons/year.

The purpose of the expansion is to secure an essential resource. In order to strengthen its capability to cope with future changes in demand and supply of raw material and with price fluctuations, Shin-Etsu Chemical is going ahead with strengthening its business basis by means of producing basic raw materials that are essential to procure for many of its core products.

Silicon metal is a main raw material for the core Shin-Etsu Chemical’s products of semiconductor silicon, silicones and synthetic quartz. In addition, because silicon metal is also used as a main raw material for solar cells, the market for which is forecasted to grow worldwide, demand for silicon metal is expected to strongly grow.

Western Australia possesses plentiful amounts of good quality silica, and Simcoa Operations holds a 50-year mining concession in the superior mining area. Furthermore, Simcoa is producing high-quality silicon metal by manufacturing its own charcoal, which is used as a reductant. Among the world’s semiconductor silicon manufacturers, there is no maker other than Shin-Etsu Chemical that carries out the production of silicon metal starting from the process of the mining of silica.

In 1996, Shin-Etsu Chemical acquired 100% of the shares of Simcoa Operations, which at the time was experiencing financial difficulties, for about ¥6 billion. As a result of the fruitful outcome of management reforms that were implemented under the leadership of Shin-Etsu Chemical’s President Chihiro Kanagawa, from the first year of its operations after the acquisition Simcoa Operations’ business performance switched to black figures. Since its acquisition by Shin-Etsu, for 13 consecutive years Simcoa has been making profit. The new expansion plan will be totally carried out by using Simcoa’s own funds.

Outline of Simcoa Operations Pty. Ltd.
Head Office and Plant: Kemerton Industrial Park, Western Australia, Australia
(180 kilometers south of Western Australia’s capital of Perth)
Land area: 400 acres (1.6 million square meters)
Silica mining: 200 kilometers north of Perth
Plant facilities: 2 electric furnaces, sawmill, and facilities to manufacture charcoal
Production capacity: 32,000 tons/year
History: 1989 December Start of operations
1996 February Shin-Etsu Chemical purchased Simcoa Operations from Deutsche Bank; company became a 100%-owned subsidiary of Shin-Etsu Chemical.
President: Ervin E. Schroeder
(concurrently, Vice President in charge of manufacturing at Shintech)