SkyWater Technology Inc., the biggest maker of semiconductors in Minnesota, is adding a third clean room that will allow it to build smaller chips and ones designed for outer space.

Construction on the addition just started at the factory in Bloomington, a few blocks from the Mall of America. "It's exciting to be putting shovels in the ground," Tom Sonderman, SkyWater's chief executive, said Monday.

The room will stretch along what is now the front of SkyWater's factory. It's about four stories, though about half is a complex underground system for air flow that keeps the manufacturing level free of even microscopic dust.

The Department of Defense has agreed to grant SkyWater up to $170 million to help pay for much of the expansion, chiefly because the military wants to boost the production of radiation-hardened chips, known as rad-hard. They are used in harsh operating environments such as outer space where radiation makes ordinary chips ineffective.

When the new room is built and operating, SkyWater expects to add 30 to 50 permanent jobs at the plant, which now employs about 500.

The addition is the first physical expansion at the company since 1995, when a second clean room was built that doubled the size of the plant, which was built in the early 1980s. New tools and equipment have been installed several times since then to upgrade the factory.

SkyWater, formed in 2017 by the Minneapolis investment firm Oxbow Industries LLC, bought the plant from Cypress Semiconductor and has since undertaken several initiatives to diversify its output and advance its technological capabilities.

The company last year formed a research project on 3-D chips with the Defense Department's research agency, called DARPA, and the Massachusetts Institute of Technology.

Copper interconnects

With the new clean room, SkyWater will for the first time be able to build chips that use copper interconnects, a material that is more useful for chips that are smaller and pack more circuits.

That capability should also appeal to the chip designers and manufacturers that use SkyWater as a contract builder.

"There are other commercial companies that are also working with us to expand this footprint," Sonderman said.

SkyWater has been constrained at making chips with circuits that are 90 nanometers apart, a relatively sizable gap compared to the industry's cutting-edge manufacturing at 10 nanometers or so, in its current clean rooms.

With the new clean room and copper interconnects, SkyWater will eventually be able to make chips at the 65 nanometer level and smaller.

The company is also planning its first production of rad-hard chips, which have been produced in the past by a relatively small number of manufacturers and mainly for satellites and space vehicles.

The creation of the Space Force, Sonderman said, is one reason the military is looking to boost the supply of rad-hard chips. "There's a lot of interest in putting more electronics into space," he said.