Forest and Bird says it will legally challenge the Department of Conservation's (DOC) plans to downgrade the status of specially protected conservation park land in Hawke's Bay so it can be flooded for the Ruataniwha Dam.
DOC announced recently it would deregister the protected land so the Hawke's Bay Regional Council's investment company HBRIC could use it for the $600 million water storage project.
DOC plans to swap the 22 hectares of Ruahine Forest Park land for private land on nearby Smedley Station.
The land is home to several threatened species, including the New Zealand Falcon, long tailed bat and fernbird.
Forest and Bird said it believes that the land-swap was unlawful, as DOC had the power to swap stewardship land, but not specially protected conservation park land.
It said the issue went far beyond Hawke's Bay and set a precedent for all specially protected conservation land, which included forest parks, conservation parks, and ecological and wilderness areas.