Q-Cells radically changes its position on Timminco and purified silicon.

During its quarterly earnings call held this morning Q-Cells AG (XETRA:QCE 71.95E) announced that it had now tested purified smelted silicon from 16 companies. Q-Cells also announced that it has now determined that at least 5 of those companies have already fulfilled its quality criteria. Q-Cells is continuing to test materials from all 16 companies and acknowledged working with many others, some of which it described as quite large.

Q-Cell refused to confirm Timminco Limited’s (TSX: TIM $24.60) contract pricing claims. Q-Cells now says it has a plentiful supply of purified smelted silicon. Q-Cells refused to confirm if it would close any other deals with Timminco saying it will be “swimming” in purified silicon in 2009.

It is important to note that Timminco’s own paid promoter, Photon Consulting, has found at least 26 companies engaged in purifying smelted silicon with good data. asensio.com also found many purification schemes with good data. All of these have better process disclosures than Timminco. Many of these companies actually have published papers and hold patents on the purification of smelted silicon, and have participated in purified silicon research seminars. Timminco has none of this.

Smelted purified silicon is readily available in China at $10 per kilo in wafer form. Smelted silicon is purified using many standard well-known melting, treatment and solidification processes. Timminco itself claims its own plant is particularly simple, inexpensive, easy to construct and cheap to operate and maintain.

Q-Cells also showed plans for a special wafer and cell production plant. The new plant is needed to make cells from purified smelted silicon. Q-Cells is relying on its own technology not on its suppliers technology or the purified smelted silicon materials themselves, which are simple 100% smelted and then purified silicon. Yesterday Canadian Solar Inc. (NASDAQGM: CSIQ $40.78) also disclosed a proprietary process to use simple 100% purified smelted silicon to make cells.

Timminco’s analysts have no experience in evaluating the cost and capacity, and proprietary position, of a plant that purifies smelted silicon.

In the absence of this experience and independent verifiable information on Timminco’s capacity and costs, Timminco’s analysts have wrongly relied on a previous announcement of a contract with Q-Cells to support their blind Timminco recommendations. In fact, Q-Cells had not provided any information that analysts or investors should have reasonably relied upon to verify Timminco’s capacity and cost claims. A report detailing this matter is available at asensio.com by clicking here.

Posted in Timminco Limited

Manuel Asensio doesn’t bet often. But when he does, it’s wise to pay attention.

Paul Kaihla
eCompany Now
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