The New Zealand government Monday announced the establishment of a new state company to help fund irrigation projects with the aim of achieving a massive expansion in the country's pillar agriculture sector.

Primary Industries Minister Nathan Guy said Crown Irrigation Investments Ltd. would work with backers of new irrigation schemes, helping to kick-start projects that would not otherwise get off the ground.

The government had set aside 80 million NZ dollars (61.93 million U.S. dollars) for that purpose, Guy said in a statement.

"Crown Irrigation will invest where it is considered necessary to get a project underway. It will be a minority and targeted investor," Guy said.

"This is another important step towards unlocking the massive opportunities that water storage and irrigation can create for New Zealand."

The country had the potential for another 420,000 hectares of irrigated land to be available for a variety of uses, which could boost New Zealand exports 4 billion NZ dollars a year by 2026, which would support thousands of new jobs, he said.

"More consistent river flows in summer will also have real benefits for the environment, with improved habitats for fish and birdlife," he said.

"After the extreme drought that most of the country suffered earlier this year, the need for better water storage is obvious," Guy said, referring to the country's worst drought in decades over the southern summer.