Forest and Bird says it believes the Department of Conservation (DoC) is being unlawful in its decision to revoke the protected status of conservation land in Hawke's Bay to make way for the Ruataniwha Dam.
The land is currently home to several threatened species including the New Zealand falcon, the fernbird and the long-tailed bat.
DoC has agreed to revoke the protected status of the 22 hectares in Ruahine Forest Park and swap the land for 170 hectares of private land containing beech forest and regenerating native bush.
Forest and Bird general counsel Peter Anderson said the decision appeared to be very out of character for DoC.
"Normally DoC do a reasonable job on these things but this seems to be a little unusual in terms of the downplaying of the conservation values here. It's not something we'd normally expect to see from DoC," he said.
"This is a highly controversial project and there's a large amount of political pressure. I can't be sure about that but that does seem to be a prevalent part of the decision-making process.
"We're going to have a look at the decision and we are going to assess our legal options. The obvious option is a judicial review of the decision to see if we can get it turned over but that decision will take us a few weeks to work through.
"The decision has a wider precedent for other potential revocation of other specially protected lands. These are the lands which have the best bits of ecology and plants and animals on them and this seems to set quite a dangerous precedent in terms of allowing that to happen elsewhere so that is one of the important issues we are concerned about here."