In a press conference, New Zealand Prime Minister John Key revealed that filming of THE HOBBIT would stay in his country, reports ComingSoon.net. In a deal with Warner Bros., New Zealand will adjust its film incentives program, which could see the studio receiving an additional $15 million rebate.

Key went on to say that his government is moving to work on laws that insurance stability in the Kiwi film industry. Union unrest toward THE HOBBIT had threatened to move the production to another location.

Production will start on the $500 million films in February. New Line will release the films in December 2012 and December 2013.