This Record describes a geophysical survey between Rapindik and Matupi volcano near Rabaul, New Guinea, made at the request of the Commonwealth Department of Works, to assist in the investigation for possible hydrothermal power production in a hot volcanic area. The survey disclosed three major shear zones and some small shears or faults. These are partly covered by young basalt lava flows, which possibly act as a retaining cap for steam permeating the shear zones. Higher ground temperatures are recorded at shear zones because steam from lower levels is deflected sideways to the shear zones by the basalt cap. The most favourable locality to test the occurrence of steam is on the basalt cap, near a hot place of the shear zone, where the drill can be diverted into the shear zone at any desired depth.