New Zealand Prime Minister Jacinda Ardern's government is facing its first legal challenge over recent decisions including its move to no longer offer new offshore exploration blocks.

The legal challenge is by Auckland-based oil and gas producer Greymouth Petroleum, which said it filed claims in the High Court in April this year following the government's controversial and unexpected decision to stop issuing new offshore permits.

One of Greymouth's claims is that the decision, handed down 12 April, was unlawful.

Another claim by Greymouth relates to New Zealand's Energy Minister Megan Woods declining to grant an offshore coastal permit to Greymouth following its submission of a compliant bid in the 2017 Blocks Offer.

A third claim relates to that bid being superior to a successful bid for a similar permit made by a Chinese new entrant.

Greymouth said it regretted having to take court action but it had been unable to resolve differences with Woods and her officials.

Greymouth chairman Mark Dunphy said: “We are not ‘Big Oil’, we are extremely hard-working New Zealanders who are proud of what we do."

The government's statement on ending the issuing of new offshore permits "did not comply with the process required by our law and this will be clarified by the High Court", added Dunphy.

"The policy change is abrupt, counter-productive, comes too soon and will add to current gas shortages and further increase gas and petroleum prices.”

Meanwhile, the International Association of Geophysical Contractors (IAGC), which represents the global geophysical industry, has "strongly condemned" the government's introduction last week of a bill that will give effect to its decision to ban new permits. The Houston-based association said it was disappointed the changes contained within the proposed bill would "not allow our members nor New Zealanders to fully realise the value of the more than US$70 million investment that the seismic industry has made in offshore New Zealand since 2013".

It added: "The IAGC’s members invested in New Zealand with an expectation that its laws would be reliable and regulatory regime stable." The government has promised that all existing permits are protected, but the IAGC said this does not apply to its members' existing petroleum prospecting permits as they "will not be able to realise returns on their investments".

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Greymouth challenges NZ over offshore ruling