SAN JOSE, Feb 19: Intel Corp., the leading maker of microchips to power personal computers, said on Tuesday it would spend $2 billion to upgrade an Arizona plant with cutting-edge chip-making technology.

The plant will begin producing roughly dinner-plate-sized silicon wafers with transistors as close together as 65 nanometres in late 2005, Intel said at a developer conference in San Jose, California.

By using larger wafers and fitting transistors closer together, Santa Clara, California-based Intel can produce chips more efficiently and create microprocessors that run cooler and faster.

The plant conversion in Chandler, Arizona, would begin in the first half of 2004. The plant makes wafers 200 millimetres across, and when the conversion is done, it and four others will produce the 300-millimetre wafers.

The production from five 300-millimetre plants will equal the production of about 10 200-millimetre plants, said Intel, which has about a dozen factories globally.—Reuters