Intel announced plans to build a new 300-mm wafer fabrication facility at its site in Chandler, Ariz. The new factory, designated Fab 32, will begin production of leading-edge microprocessors in the second half of 2007 on 45 nanometer process technology. Construction on the $ 3 billion project is set to begin immediately. When completed, Fab 32 will become Intel’s sixth 300-mm wafer facility. The structure will be about 1 million square feet with 184,000 square feet of clean room space. The project will create up to 1000 new Intel jobs at the Arizona site over the next several years. During the construction phase, more than 3,000 skilled trades people will be hired to work on the project.

Intel Corporation today announced plans to build a new 300-mm wafer
fabrication facility at its site in Chandler, Ariz. The new factory, designated
Fab 32, will begin production of leading-edge microprocessors in the second half
of 2007 on 45 nanometer process technology. Construction on the $ 3 billion
project is set to begin immediately.

"This investment positions our manufacturing network for future growth to
support our platform initiatives and will give us additional supply flexibility
across a range of products," said Paul Otellini, Intel CEO. "For Intel,
manufacturing is a key competitive advantage that serves as the underpinning for
our business and allows us to provide customers with leading-edge products in
high volume. The unmatched scope and scale of our investments in manufacturing
help Intel maintain industry leadership and drive innovation."

When completed, Fab 32 will become Intel’s sixth 300-mm wafer facility. The
structure will be about 1 million square feet with 184,000 square feet of clean
room space. The project will create up to 1000 new Intel jobs at the Arizona
site over the next several years. During the construction phase, more than 3,000
skilled trades people will be hired to work on the project.

Intel currently operates four 300-mm fabs that provide the equivalent
manufacturing capacity of about eight 200-mm factories. Those factories are
located in Oregon, Ireland and New Mexico. The company also has an additional
300 mm fab currently under construction in Arizona (Fab 12) scheduled to begin
operations later this year, and one expansion in Ireland (Fab 24-2) scheduled to
begin operations in the first quarter of next year.

Manufacturing with 300-mm wafers (about 12 inches in diameter) dramatically
increases the ability to produce semiconductors at a lower cost compared with
more widely used 200-mm (eight-inch) wafers. The total silicon surface area of a
300-mm wafer is 225 percent, or more than twice that of a 200-mm wafer, and the
number of printed die (individual computer chips) is increased to 240 percent.
The bigger wafers lower the production cost per chip while diminishing overall
use of resources. Three-hundred-mm wafer manufacturing will use 40 percent less
energy and water per chip than a 200-mm wafer factory.

Separately, Intel said it will invest $ 105 million dollars to convert an
existing inactive wafer fab in New Mexico to a component temporary test
facility. The project will provide additional test capacity to the company’s
factory network for the next two years and will result in an additional 300 jobs
at the New Mexico site during that period.