The Defence Force's bomb squad has carried out a controlled explosion to dispose of an unstable chemical in South Dunedin.
Nearby businesses were evacuated after hydrazine monohydrate was found in a crystallised form at a business in Glasgow Street yesterday afternoon.
Probiotic company Blis Technologies, where the chemical was discovered, said they called in experts as soon as they noticed the chemical's container was deteriorating.
Blis Technologies chief executive Brian Watson said staff followed company protocols by contacting experts to find out how to handle and dispose of the chemical.
"We'll certainly do a full review of the situation and understand if there's anything we could have done better ... we will endeavour to learn from this incident and attempt to avoid it in the future."
Fire and Emergency New Zealand and police followed the lead of the Defence Force team, who inspected the chemical and made a decision on the safest disposal method.
The Defence Force's explosive ordnance squad arrived at the scene shortly after 7am and detonated the chemical in the industrial area about 9.30am.
Cordons have been lifted from King Edward Street, Sullivan Avenue, Glasgow Street, Carey Avenue and Fox Street.
People inside the cordons were evacuated as a precaution.
Fire trucks and sandbags were put in place for protection of nearby properties.
RNZ reporter Tim Brown told Morning Report that the cordons set up around the site were moved back just prior to the explosion.
The area is a mixture of commercial and industrial properties. The explosion was expected to be taking place within a 100m radius, with people being kept back by about two blocks away.
The scene was under guard last night. Earlier today, Fire Southern Communications Centre shift manager Andrew Norris said the Defence Force was getting its first look at the situation around 7am.
"We believe a couple of neighbouring properties were evacuated for the night, but they were all industrial properties - nobody was there overnight."