Algae.Tec has planned a facility at South Nowra that will create more than 100 full-time jobs over four years.

The announcement comes after Algae.Tec received approval to develop its algae production system on a commercial scale.

The company will initially produce dietary supplements.

Algae.Tec chairman Roger Stroud was pleased that the Environmental and Soil Laboratory national testing facility validated the company's production in an industrial setting.

Mr Stroud said the algae yields achieved were of a sufficiently high level to justify the establishment of the dedicated production facility at South Nowra, and the company would now launch into the commercialisation phase of its development in the hope of "rapidly delivering positive cash flows".

"It has been a long, hard road and I would like to thank Dick Honan and his Manildra team, University of Wollongong Shoalhaven campus, in particular Robbie Collins and Dr Pia Winberg, and Shoalhaven City Council," he said.

"Everyone has been great. We came here two years ago to do a task and we've completed that now.

"As a result, we have decided to stay in Nowra," Mr Stroud said.

Shoalhaven Mayor Joanna Gash said Algae.Tec had already entered into a long-term lease at an industrial warehouse complex at South Nowra, allowing an almost immediate start to production.

"I am extremely pleased to see an innovative global company such as Algae.Tec undertaking an $80-million expansion of their Nowra facilities," Cr Gash said.

"The injection of a further 100 full-time positions over the coming four-year period will provide a massive shot in the arm for the local area and further diversify our growing local economy. This announcement is a further example of a growing confidence in the area for major investors and fantastic news for Shoalhaven City."

Algae.Tec expects to be selling product by the middle of next year.