Renewable Energy Corporation ASA (REC.OS) said Wednesday that production at its brand new Silicon III plant in the U.S. won't start back up until the third quarter of 2009 while repairs are carried out.

The plant started up in the second half of March and ran for 10 days, but was then closed for safety reasons after a leak was observed in the fluidized bed reactor or FBR, discharge pipe.

Modifications are expected to be implemented "by the end of the second quarter," so there won't be any commercial output during that period, the company said.

"Production from Silicon III (at Moses Lake, Washington) is expected to resume in the third quarter. However uncertainty remains in the ramping up of a large and complex chemical plant...and interruptions should be expected," REC said.

The company said the FBR discharge pipe glitch "is not related to the actual deposition of silicon in the reactor and the production runs that were carried out prior to the shutdown demonstrated that REC's FBR is a viable production technology."

REC has cut its 2009 polysilicon targets on the back of the sustained outage at Silicon III to 9,000 metric tons from an earlier target of between 10,000 and 11,000 tons. Wednesday, it reported an 87% rise in first quarter net profit to NOK394 million from NOK163.3 million on strong financial items.

Company Web site: www.recgroup.com

-By Elizabeth Adams, Dow Jones Newswires; +44 (0) 20 7842 9386; elizabeth.adams@dowjones.com