A reporter at the scene who spoke to police inspector Karl Wright-St Clair said that police has confirmed they are dealing with a P lab.
"We believe the lab was operational at the time of the explosion", said Mr Wright-St Clair.
"The explosion was contained to the basement area."
At least a dozen residents have been evacuated.
It is expected that police will re-open the road shortly and allow residents to return to their homes.
The two police officers who arrived first at the scene have gone through a decontamination process because of exposure to toxic fumes.
Mr Wright St-Clair said two men were at the house at the time of the explosion.
The injured man has serious burns to his upper torso and head area and has been transferred to Waikato Hospital.
No arrests have been made at this time but it is expected charges will be pending.
He also said police may shrink the cordon soon.
Residents are returning to their houses this morning following a suspected P lab explosion that has injured at least one man.
Some residents were walking the beach to access their homes.
Many said they did not hear the explosion, although a neighbour said he heard a compressor begin early this morning.
The 57-year-old man taken to Tauranga Hospital with burns following the blast has been flown to Waikato Hospital.
A St John ambulance officer remains in Tauranga's emergency department being monitored due to smoke inhalation.
The explosion of a suspected P lab has badly burnt a 57-year-old man and closed down a section of Ocean Beach Rd.
The man was rescued by firefighters from a home on Ocean Beach Rd at Mt Maunganui following the explosion shortly before 4am today.
He was taken to Tauranga Hospital in a serious condition.
A second man fled the house before being found by police at a nearby home.
He is "helping police with their enquiries".
A section of Ocean Beach Rd is expected to be closed "for the best part of the day" as officers investigate the suspected methamphetamine lab, police said.
About 10 houses near the explosion, which was in a home between Girven Rd and Concord Ave, have been evacuated and the occupants are staying with family and friends until they can return.
A Clan Lab team from Auckland will travel to Mt Maunganui this morning to begin a specialist scene examination.
Police have asked motorists travelling to work to use alternative routes.
Anyone with information about drugs or other offending should contact their nearest police station or Crimestoppers on 0800 555 111.