James Cameron, who directed 2009's 'Avatar', plans to make three more sequels for the sci-fi epic in New Zealand.

The Pacific Ocean Island will replace the middle-earth, sword welding, fantasy world for the high-tech, advanced weaponry, futuristic world.

The news came on Monday that U.S film companies, 20th Century Fox and Lightstorm Entertainment, will produce the trilogy which is estimated to cost NZ $500 million ($413 million) on live action and visual effects.

Cameron, along with the New Zealand Prime Minister John Key and producer Jon Landau made the announcement on Monday (Dec 16th), according to the Associated Press.

The news comes after New Zealand's government has agreed to a 25% film industry tax rebate which used to be 15%.

"The Avatar sequels will provide hundreds of jobs and thousands of hours of work directly in the screen sector as well as jobs right across the economy," Economic Development Minister Steven Joyce said in a statement (via Reuters).

The 2009 film, which was shot in Los Angeles and New Zealand, earned an estimated $2.7 billion worldwide making it the highest-grossing film of all time.

"It's quite a thrill to be officially saying that we're bringing the Avatar films to New Zealand," he told a press conference. "We had such a wonderful experience here making the first film".

Prime Minister Key expressed how much of a relief it is to the film industry in New Zealand as Peter Jackson's 'The Hobbit' sequel complete, work has took a dramatic dip.

"It's a day of great celebration," Key said. "It's a great Christmas present for those involved in making world class movies."

Cameron hopes to have the first movie ready for Christmas 2016.

James Cameron
James Cameron is hoping the first film to be ready for Christmas 2016