UPDATE 4-REC profits rise, unveils Singapore plant plan

(Adds Singapore quote)

By Aasa Christine Stoltz and Joergen Frich

OSLO, Oct 26 (Reuters) - Norway's Renewable Energy Corporation (REC.OL) said on Friday it would build the world's biggest solar manufacturing plant in Singapore and its shares rose despite lower-than-expected third-quarter core profit.

REC, one of the world's largest producers of solar-grade silicon, said it expected initial investments in the Singapore production complex of 3 billion euros ($4.29 billion) within the next five years.

REC has seven production plants in Norway, the United States and in Sweden. The Singapore plant will be developed in stages, and will incorporate wafer, cell and module production for solar panels that produce power from sunlight.

The investment, its first in Asia, will be financed with cashflow and a small loan, and could have production capacity of up to 1.5 gigawatts (GW) when fully developed, REC said.

"1.5 GW is big. I think it's just over the current manufacturing capacity of China, and China is big," said Simon Powell, head of Asian power research at CLSA in Hong Kong.

REC's shares were up as much as 7.8 percent before paring gains to 3.8 percent by 1019 GMT, valuing the company at about $23.66 billion, outperforming the Oslo benchmark index .OSEBX, which was flat.

Powell said REC would need an additional 10,000 tonnes of silicon a year to supply the Singapore solar plant, which would mean lifting its current production by about 50 percent.