Intel considers Israeli expansion

Intel considers Israeli expansion
WASHINGTON — Intel Corp. is considering an expansion of its chip-making operations in Israel that would include a new 0.13-micron fabrication facility, according to Israel's Ministry of Finance.

The investment in new manufacturing facilities could total as much as $3.5 billion, the ministry said, and would make Intel one of the largest foreign investors in the Middle Eastern state.

Intel officials met on Monday (May 1) with Abraham Shohat, the Israeli finance minister, and are reportedly seeking government aid to help finance the expansion project. The Israeli government plans an immediate review of Intel's request, Shohat said.

An Intel spokesman said on Wednesday that the meeting was part of a comprehensive Intel plan to add future capacity. The company's review includes facilities in Israel, Ireland and New Mexico. "We haven't made any decisions," the spokesman said. "We're looking at all our sites."

Intel has received financial aid from Israel in the past several years to open manufacturing and related semiconductor facilities. Most recently, the Israeli government contributed about $600 million of the estimated $1.6 billion needed to build a fab in the southern city of Kiryat Gat. The 0.18-micron plant opened last year, and is expected to export about $1 billion in products annually.

Intel also operates design and development centers in Israel along with a networking center. The chip maker opened its first manufacturing facility in Israel in 1974.

The Finance Ministry said the new plant could boost Intel's annual exports from Israel to $2 billion. It is also expected to increase the company's work force in Israel by as many as 3,000 workers.

Regardless of where it decides to expand, Intel said any new fab would use 0.13-micron technology. The chip maker recently began expansion of its facility in Chandler, Ariz., where it is adding 0.13-micron production capability.