December 2, 2005 – Intel Corp. said yesterday that it plans to build a new $3.5 billion, 300mm wafer fabrication facility at its site in Kiryat Gat, Israel. The new factory will produce chips using 45nm process technology and will be operational in 2008.

Using 300mm manufacturing technology consumes 40% less energy and water per chip than a 200mm wafer factory, Intel said.

On June 28, 2005, Israel had refused to improve the conditions promised to Intel should the international microchip manufacturer decide to set up its next generation fab in Israel.

In the past, Intel received $600,000 to set up its Fab 18 in Kiryat Gat, out of a $1.8 billion investment. However, the state had rejected Intel’s request to the Investment Promotion Center of the Ministry of Industry, Trade, and Labor for a $60 million supplement for Fab 18.

The reason given was that even though Intel had met all its investment targets, the sales and workforce numbers were lower than forecast, due to a downturn in the global semiconductor market.