Daqo New Energy Corp. (NYSE:  DQ) ("Daqo New Energy", the "Company" or "we"), a leading manufacturer of high-purity polysilicon for the global solar PV industry, announced that the board of directors has officially approved the Company's Phase 3B expansion plan ("Phase 3B Project") for its polysilicon facilities in Xinjiang.

Phase 3B Project is expected to increase the Company's polysilicon annual nameplate capacity from the current 18,000 MT to 25,000 MT. By adopting additional technology improvement and debottlenecking projects, the Company may be able to further increase its capacity to 30,000 MT per annum by the end of 2019.

The Company expects to complete project design and initial preparation works for Phase 3B Project by the end of 2017, complete constructions and installations by the end of 2018, start pilot production in the first half of 2019 and reach full capacity by the end of the second quarter of 2019.

For the Phase 3B Project, the Company plans to adopt new designs, processes, technologies and equipment that would further improve the quality and purity of its polysilicon products. The polysilicon products of the Phase 3B Project are anticipated to reach electronics grade and will be targeting the mono-crystalline wafer and semiconductor markets, which have more stringent requirements on polysilicon quality and purity, and therefore have higher entry barriers. The Company may potentially enjoy higher profit margin if it could successfully access these markets with its differentiated ultra-high purity electronic-grade polysilicon products.

In addition to polysilicon quality upgrading, the Company expects to implement new production processes to improve operational efficiencies, which would further reduce our total production cost.  Once Phase 3B Project is ramped up to full production capacity, we anticipate the overall total production cost for our Xinjiang facilities could potentially be decreased to US$7.50 per kilogram, benefiting from better operating leverage, adopting new production processes and equipment with higher efficiencies, and achieving greater economies of scale.

Daqo New Energy Corp. | www.dqsolar.com