The Melt CEO Trent Bagnall says the Upper Hunter was an obvious choice for the next Melt, which was launched in 2019 by former prime minister Malcolm Turnbull to help entrepreneurs and companies design and build the hardware necessary to commercialise innovative products.

"Muswellbrook has a whole bunch of exciting capacities and skills in mining, engineering and power but it has challenges with two power stations (Bayswater and Liddell) closing, so we are creating new business, new products, supporting exisitng businesses and diversification," Mr Bagnall said.

The Muswellbrook Melt's launch was postponed amid pandemic restrictions however will be revealed to the local business community in coming weeks.

The first phase will open in August: a co-working space to support startups and SMEs will be based in the existing heritage building at Loxton House on Bridge Road, just metres from the University of Newcastle's campus nestled behind.

Meanwhile, next door to Loxton House, construction will soon start on the Donald Horne building, named after the late author and intellectual. The two-storey site will include state-of-the-art prototyping space similar to what is already at Warners Bay but on a far bigger scale.

Dubbed an "innovation precinct", the building will focus heavily on STEM training - both in-house and delivered via programs in local schools - which will be overseen by full-time facilitator.

"We are trying to supercharge SMEs and startups and education and training in STEM," Mr Bagnall said.

"It is a real first for the Hunter in terms of integrating STEM education into economic development programs. We are looking to build future workforces and train existing ones."

It is expected that businesses dealing in mining logistics, agriculture, energy and the Port will benefit.

"The Melt will help existing businesses and SMEs with commercialisation of new products as well as startups and it will attract new business into this LGA," Mr Bagnall said.

While The Melt's Warners Bay site was more focused on startups, the Muswellbrook site is designed also to help businesses trying to scale or invest in the so-called "Industry 4.0" technologies of the future.

"Existing businesses in the region can come to learn about new technologies before they invest in them," said Mr Bagnall,

"If they are a small or big machinery shop in Muswellbrook and they want to look at doing new things or commercialise new products but don't want to invest in new equipment if they don't know the risks and benefits, we can showcase that and make it open to them to explore."

Mr Bagnall said The Melt's vision is to continue to expand in regions or LGAs which want to support its industry in specific areas, for example agtech, cleantech, health and defence.

At the Warners Bay site, at least 50 advanced manufacturing projects are being developed using the estimated $3 million of production equipment.

The Melt has been linked with Astra AeroLab at Williamtown and Mr Bagnall is examining one other Hunter location alongside one in Sydney and another in regional NSW.

"What we've learnt in the last year is that it's better to have a lot of smaller Melts with specific capabilities ...to build a regional network together that can form a powerful opportunity for people who want to use them," he said.

While the first Melt raised $1 million in investment, its backers are now raising a second similar sum for use in the Muswellbrook project.

"I expect each location we do will be helped by The Melt to unlock their own angel funds for a rolling fund to support entrepreneurs in each location," Mr Bagnall said.

While AMPControl was involved at Warners Bay, The Melt's new engineering partner is Safearth, which specialises in earthing (making power systems safer) and product development.

Mr Bagnall believes The Melt will play a role not only in training future and existing workforces but will help retain talent in the area.

"We are not trying to take plant fitters and turn them into working on Space X rockets, we are taking for example someone from a trade and upskilling them to CNC and into 3D printing, we are basically doing a step by step approach of skills development to help with the commercialisation of new products. It's producing talent but it's also about retaining it locally."

A statement from Muswellbrook Shire Council mayor Rod Scholes said its "early preparation" for the shire's economic transition involved attracting new innovative industries to capitalise on the innovation already being done by existing SMEs.

'We know that investment in STEM workforce skills will best equip the Shire's workforce for the jobs of the future because of the critical thinking and agile skills that STEM provides a workforce," he said.

"The Melt were successful in winning a tender to undertake some of this work in Muswellbrook and have a proven track record in these areas in Newcastle and Lake Macquarie."

Mr Scholes did not respond to questions regarding the level of funding for the project, citing commercial in-confidence, however in November last year Deputy Premier John Barilaro announced $900,000 in Resources For Regions funding for two STEM education projects at the Upper Hunter Innovation Precinct where the Donald Horne building will be.

"Essentially council's funding provides a makerspace, STEM Learning Environment and two full-time specialist staff," Mr Scholes said.

"We are very excited by the work of The Melt in the Upper Hunter and expect to see the scaling up of a few innovative startups."