Regional Economic Development Minister Shane Jones says a business extracting minerals from geothermal fluid ticks all the right boxes for the Provincial Growth Fund.

The fund is putting $15 million into Geo40 Limited through a loan and convertible note, allowing the company to go ahead with plans to build and operate a large scale extraction plant at the Ohaaki geothermal site near Taupo.

Mr Jones says the project will create 70 jobs in the construction phase and 30 permanent jobs.

It has the backing of local iwi Ngāti Tahu and the operator of the geothermal field, Contact Energy, which will benefit from the extraction of silica from the fluid before it goes through its pipes..

"Silica eventually turns into a form of concrete on the inside of the pipe so this firm is able to extract that silica, increase the life of the pipes and make a handsome profit. They have however like a lot of innovative businesses in New Zealand struggled to attract capital from orthodox sources so the $15 million is a marriage of science, local Māori endorsement, technology entrepreneurialism and international export earnings," Mr Jones says.

Also in nearby Reporoa, the Provincial Growth Fund is lending Eco Gas $7 million to build a full-scale demonstration biogas plant to recover energy, carbon dioxide and nutrients from food waste that would otherwise go to landfills.
 

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