The Bay of Plenty Regional Council is recommending the Rena wreck be left on the Astrolabe reef.
The container ship ran aground on the reef off Tauranga, in 2011.
A report released by the council said as long as key issues could be addressed, such as mitigating the effects of copper on the environment, the wreck should be allowed to stay.
The report recommended conditions on the wreck being allowed to stay should include clearing debris, removing sections of the bow and working to remove copper from the environment.
A resource consent application to leave the a wreck on the reef would be heard by the Environment Court and the report will be passed onto the court as part of its consideration.
The Government had previously called for part of the wreck to be taken off the reef.