Police cordoned off a large area and called in army disposal experts after explosives were found in an abandoned car.
Senior Constable Graeme Ferguson of Balclutha police said six rolls of Powergel Buster were found in the abandoned car near a forestry block.
The area was used by walkers, mountain bikers, horse riders and motocross riders, he said.
Powergel Buster is capable of creating high strength, detonator-sensitive explosions.
The explosive is white with a firm putty-like consistency, and is stored in rolls similar to dog food.