The Bay of Plenty Regional Council's commissioners have decided to leave the Rena wreckage on the Astrolabe Reef.
The 38,000 tonne container ship Rena ran aground on the reef on 5 October 2011 and eventually broke up. The vessel had 1368 containers and approximately 1700 tonnes of oil on board.
It spilt about 350,000 litres of oil into the bay, making it one of the country's worst maritime disasters. The ship broke up in various storms and split in two. Salvors were able, over time, to remove large parts of the ship's main cabin and bridge structure, but two large sections of the bow and the stern sank.
In September last year, independent commissioners for the regional council heard 20 days of submissions on the ship owner's resource consent application to leave sections of the wreck on the reef.
In the decision released today, the commissioners also gave consent for any discharge of harmful substances or contaminants that might occur from what was left on the reef.
The decision stated the consent was subject to extensive conditions.
The Rena's owner, Daina Shipping Company, acknowledged the decision by the commissioners.
"The next steps from here will be to carefully consider the decision and the conditions, in consultation with our New Zealand legal and environmental team, before I return to New Zealand next month," company representative Konstantinos Zacharatos said.
An elder from Tauranga iwi Ngai Te Rangi, Hauata Palmer, said he was worried about the damage from the wreck and its remaining contents spilling.
"And I'm sure that's going to happen again, so what do we do about the clean-up? The same thing is going to happen, just a repeat of when it first hit."
Mr Palmer said it was likely the iwi would challenge the decision. Tauranga mayor Stuart Crosby wanted the wreck removed but said he wasn't surprised by the commissioners' ruling, because reports had shown it was the practical solution. He was confident there would be strict conditions to limit pollution.
Those objecting to the decision have three weeks to lodge appeals with the Environment Court.