Intel Corp. announced on Monday that it will invest $1 billion to $1.5 billion in its Rio Rancho site to retool Fab 11X for production using 45nm manufacturing process. Fab 11X will be the company’s fourth factory scheduled to use the 45nm process, with production in New Mexico scheduled to start in the second half of 2008.

“Our new 45 nanometer process represents one of the most significant manufacturing breakthroughs in decades and we believe that putting it in our factory in New Mexico will help us deliver the best possible products for our customers,” said Paul Otellini, Intel Corporation's president and chief executive officer. “Our Rio Rancho site has successfully operated in New Mexico for 27 years. Based on that success, we are pleased to position Fab 11X for Intel's next generation of technology.”

Initial production of Intel’s 45nm products will be done at its Oregon development fab, D1D. The company is currently building two other factories that will use the 45nm process. The $3 billion Fab 32 in Chandler, Arizona, will commence production late this year; and the $3.5 billion Fab 28 in Kiryat Gat, Israel, will begin production the first half of next year.

Fab 11X currently manufactures 90nm computer chips on 300mm wafers. Fab 11X began production in October 2002 and was Intel’s first 300mm, high-volume manufacturing facility. It was also Intel’s first fully automated, high volume factory producing 300mm wafers.

Intel’s 45nm high-k and metal gate process consists of an innovative combination of new transistor materials that reduces transistor leakage and increases performance. When 45nm production begins later this year, the company will use a new material with a higher-k (dielectric constant), and a new combination of metal materials for the transistor gate electrode. First commercial 45nm chips from Intel will emerge in the second half of 2007.