The company's general manager, Craig Hunter, yesterday confirmed the company was investing $2.5 million in a bid to expand the business, which could lead to more work and up to 12 new jobs.
The company has bought a 3864sq m parcel of land near Forsyth Barr Stadium - spread across two titles at 2 and 4 Neptune St - to allow its "cramped" Ravensbourne Rd operation to spread out.
The property had been owned by the Dunedin City Council, which bought it for the stadium and State Highway 88 realignment projects, but it had since been considered surplus, council city property manager Robert Clark said.
Workers wearing protective equipment were on site yesterday to begin removing a derelict building, including a roof containing asbestos.
Mr Hunter said the building was part of the old precast concrete yard that once operated there. His company planned to replace it with a workshop for the company's 50 staff.
The total value of the investment, including the land and new workshop, was $2.5 million, he said.
The new workshop would be used predominantly for the construction of large mobile mixing units, which were attached to trucks and used to carry the raw materials for explosives in four separate compartments, he said.
The company shipped the completed units to Australia, where they were used in mines, to truck the explosive materials directly to blasting holes for deployment, he said.
The company was already building eight of the units as part of a contract to supply Orica, in Australia. It hoped to produce 12 by year's end.
However, Orica wanted more, and it was hoped the extra room provided by the land purchase would allow production to increase, Mr Hunter said.
If all went well, another 12 staff could be needed within a year or two, he said.
"They will give us more if we can build more. Hopefully, with the new workshop, we will be able to build more."
The company's success could also mean more work for other Dunedin companies working as subcontractors to Palmers Mechanical on the contract, including Farra Engineering and Metalspray Engineering, he said.
In a tough business environment, it was "quite a positive" for the city, he believed.
Mr Clark said the land had been used partly as a construction site during the building of the stadium, but was no longer needed, and the sale had been approved by the council's property subcommittee.
The council had been reviewing its property portfolio to identify surplus land able to be considered for sale, but Mr Clark said this was a "one-off" and not the result of that project.
Details of the exact sale price, and the size of any profit made by the council, were not available yesterday.
