October 12, 2007 – Taiwan’s Formosa Plastics Group is reportedly in talks with Norwegian firm Renewable Energy Corp., the world’s third-biggest polysilicon supplier, in a possible joint venture to produce polysilicon, according to local media reports.

The Taiwan Economic News and Digitimes both note that FPG officials are meeting with REC president Erik Thorsen. The company’s chairman, Li Chih-chun, has confirmed FPG’s desire to tap into the polysilicon market but so far has not identified a partner (though he did rule out Siemens due to low manufacturing yields, the Taiwan Economic News claimed.)

Both reports note that REC execs previously visited FPG in Taiwan but the parties could not settle on terms of a potential deal.

The Taiwan newspaper cites “photovoltaic industry insiders” that REC is eyeing PV plans in Taiwan, South Korea, Singapore, or Malaysia, and are being wooed in Taiwan by CPC Corp., FPG, and Lee Chang Yuang Chemical Industry Corp. Taiwan’s Ministry of Economic Affairs (MOEA) is also pushing for REC’s business, pointing to silicon sands in Miaoli County in northern Taiwan as a good base for raw polysilicon material. REC already has a deal with domestic firm Motech to supply ~$300M worth of wafers until 2010.

The Norwegian wafer supplier currently sits in third place globally behind Germany’s Q-Cells AG and Japan’s Kyocera Corp. and Sharp Corp., but is aggressively expanding production capacity, including a recently announced $270M investment to expand output nearly tenfold to 300MW by 2010, the paper notes.