US-based solar silicon manufacturer Silicor Materials has provisionally signed Danish contractor MT Højgaard to build a new poly plant in Iceland.

Under the conditional DKK155 billion (US$228 million) deal, MT Højgaard will design and build the 121,000 square metre plant, which is scheduled for completion in 2018.

Silicor has been touting the cost benefits of its planned Iceland plant, claiming that a combination of the cheap geothermal power available in Iceland and its proprietary manufacturing process will be able to produce solar-grade silicon initially at US$9/kg, with further cost reductions possible after that.

The minimum nameplate capacity of the plant is expected to be 16,000 metric tons, although Silicor has said it hopes to be able to able to optimise the plant to achieve 20% more than that, taking output to 19,000MT.

Silicor has already secured port and land agreements for the plant, and signed SMS Siemag to provide the equipment for the site.

The contract with MT Højgaard is conditional on Silicor Materials achieving full financing of the project.