Early European settlers wanted to replicate the coal-fired gas works of the old country which made their appearance there in the early 18th century.

A prospectus was issued in January 1874 for 1500 shares of £10 each (2019: $1330).

Ten local businessmen formed the board of directors, with Frederick Sutton (1836‒1906) as chairman.

As part of the prospectus, an estimation of the gas to be produced in Napier was given as 3,000,000 cubic feet (84,950,539 litres) per annum to produce receipts of £3,000 ($400,000) and an annual profit of £1,389 ($185,000). A good dividend was anticipated from the enterprise.