ZIMBABWE’S largest platinum miner, Zimplats has started work on a major expansion project which is expected to see annualised output increase to one million ounces and take the company’s investment in the country to over US$1 billion over the last nine years.

Management announced what they described as “exellent operational and financial results” for the last twelve months with turnover jumping 236 percent to US$404 million on the back on increased sales and firmer global metal prices.

Annual profits topped US$122 million compared to a loss of US$25 million a year earlier.

The company credited the improvement to the “recovery in metal prices (which) was driven by some turn-around that has been recorded in the major world economies as well as increased level of investment in platinum group metals (PGMs” .

Board chairman, David Brown, said work on the company’s key US$450 million Ngezi Phase Two expansion programme has started with completion expected in 2014.

The project had been held up by regulatory concerns as well as a dispute over additional profits tax with the government and money owed the company by the Reserve Bank of Zimbabwe (RBZ).

However, the tax dispute has since been resolved with the company paying US$23 million to the government while discussions over the US$34 million owed by the RBZ continue.

Brown said completion of the Ngezi 11 project would make Zimplats the largest single investor in Zimbabwe in recent years.

“The investment in the Ngezi Phase II Expansion project is clear testimony of your company’s commitment to Zimbabwe and its desire to develop its resource base for the benefit of all its stakeholders.

“We believe that the goal of 1 million platinum ounces per annum could be expedited in an improved and sustainable investment climate in Zimbabwe,” the group chairman said in a statement accompanying the company’s annual results.

Zimplats however continues to express concern over the country’s empowerment regulations which require all foreign-owned companies to ensure locals control at least 51 percent of their equity within five years.

South Africa-based Impala Platinum – the world’s second largest platinum miner – owns 87 percent of the Zimplats with the balance controlled by independent investors.

Zimplats wants a prior arrangement with government under-which the company gave up some of its platinum reserves in return for “empowerment credits” to be considered under the new legislative framework.

“It is our firm belief that at this time, Zimbabwe’s greatest need is for increased levels of foreign direct investment to create more employment in the country.

“We therefore urge the authorities to implement this law in a way that does not compromise Zimbabwe’s desire to be seen as a preferred investment destination,” Brown said.

The company added that discussions continue with the government over compliance with the empowerment laws.

Brown, however insisted that “implementation of the Act (should take) into account the 2006 release of ground agreement (and) the massive social and infrastructure investments that the company has undertaken since it commenced operations in 2001”.