Solar Grade Silicon roads lead to Ruše - Part 3

[Maribor and Ruše, Slovenia]

TDR - Metalurgija Visit with Solarvalue AG

Photo: TDR facility with Solarvalue redlines and my blue circle of the Ferrochrome Building

Since Solar Grade Silicon roads lead to Ruše - Part 2 (please see the end of this post for corrections), the news flow from Solarvalue AG (XETRA:SV7) (http://www.solarvalue.com) has been disappointing. While I know readers were anticipating the next installment of the Ruše series, both investors and I have lost confidence in the company after:

Solarvalue to proceed without Strategic Partners
Additional Solarvalue AG Secondary Placements Planned
Solarvalue Newsletter 1/2007

Per my mobile’s missed call log, Mr. Fischer or someone in his office did attempt to contact me on February 9, 2007. But my simple questions remain unanswered.

Instead of looking at Solarvalue method Process II and Process III as promised, this installment will cover John Mott's presentation of the current conversion plan for the TDR M6 arc furnace and Solar Grade Silicon production at the Kepler Equities Alternative Energies Conference.

In order to prepare M6 for silicon metal production, Mr. Mott said:

This involves changing the electrode columns to allow use of high-purity carbon electrodes, installing a bearing assembly under the furnace hearth to allow it to rotate in operation, and replacing the hearth carbon lining. Additions to the mix system are underway.

M6’s higher power output of 24MW (Megawatt), 6MW more than M5 (I had 12MW for M5 and 20MW for M6 before?), is offered as a reason for the arc furnace change and maintaining the 2007 Solar Grade Silicon (SGS) production goal of 850 metric tons. I suspect there must be a major or catastrophic issue with the M5 arc furnace for a plan that requires a bearing assembly to be installed on M6.

John Mott also said:

A thorough cleaning and sealing of the entire furnace building will be undertaken as soon as the furnace hearth is relined in order to prevent any contamination of the mix or silicon produced by impurities present in either prior operations or from adjacent areas of the plant.

This was not news. Continuing, John said:

Design work has begun to transform the existing Ferrochrome Building into the new SGS Facility where the very clean metal produced in M6 is further refined into Solar Grade Silicon by careful washing of the metal in the molten state and the use of new solidification techniques. All of the metal made in M6 will be processed through the SGS Facility with an expected initial yield of 20% as Solar Grade. Additional improvements and refinements to the process and equipment are on the drawing board or already in testing to incrementally improve the process yield.

Consolidating SGS operations in the Ferrochrome Building was not the plan of record back in November 2006 during my visit to the TDR facility. SGS Process II and Process III steps were then planned for the Future Solar Grade Silicon Production Building as shown in the TDR facility redline above and the close up photo below. Consolidation of operations makes sense to take advantage of the molten state of the silicon metal produced in the M6 arc furnace. Silicon has a melting point of 1414 °C (degrees Celsius), so leveraging silicon in the molten state is necessary to avoid wasting energy during processing as I learned from John Mott during the visit.

John Mott presented the following Production Calendar:

January 2007: Start conversion of first production line (6 months) in TDR-Factory in Ruse, Slovenia
3. Quarter of 2007: Start production of solar grade silicon (SGS)
2007: Production of 850 metric tonnes of SGS
End of 2008: Capacity for 4,400 metric tonnes of SGS

While I believe SGS production is delayed at least (please note the three methods of emphasis: bold, italics, and underline) a quarter with the M6 upgrades, I find the unchanged 2007 SGS production target of 850 metric tons a bit unbelievable. I don’t have experience with metallurgical silicon production, but a 33% increase in system power with M6 does not seem to equate to a doubling of output. I had planned to ridicule a PHOTON International article, “Cheap silicon?”, from PI 11/2006, p.102-108, by Michael Schmela, but taking 20-25% of Solarvalue’s 20% SGS production yield target claims may have been prescient insight.

Solarvalue’s Financial Calendar was disclosed as follows:

1. Quarter 2007: Annual Report 2006
1. Half 2007: General Meeting
1. Half 2007: Secondary Placement
1. Half 2007: Entry Standard

I look forward to reading Solarvalue’s first annual report, and existing shareholders should be concerned with the pricing and dilution from the Secondary Placement planned for the first half of 2007.

The new Solarvalue AG website is live and has a classic localization mistake. Text with language icons should always be localized in the native tongue; English should always read English just as German should always be Deutsch.

GP Note: Solarvalue reimbursed me for my flights to Berlin and Graz. I maintain independent editorial control over this article series, I have not been paid to write them, and I do not own any shares of Solarvalue AG stock.

Corrections to Solar Grade Silicon roads lead to Ruše - Part 2 per John Mott:
M6 is running at an electrode current of about 72,000 amps currently at 20MW. But, the current would have been lower when you saw it at 14MW. M6 and M5 both only have one transformer, only M1 has three separate transformers. It doesn't really matter to the operation. Also, M6 is making 75% FeSi, which is always pretty damned close to 75% silicon and 25% iron.