The National Party insists there has been no conflict of interest in David Macleod's chairing the committee considering the contentious fast-track bill.
The New Plymouth MP received $10,000 from a donor with shares in a company hoping to benefit from the legislation.
Macleod was yesterday stood down from his role as chair of Parliament's Environment Select Committee for failing to properly declare donations to his election campaign.
Phil Brown - a New Plymouth businessman with substantial shares in seabed mining company - donated $10,000 to Macleod.
Trans-Tasman Resources mining project wants to mine ironsands off the coast of Taranaki and hopes to get the green light under the Fast Track Bill, once it is passed into law.
The legislation is being considered by the Environment Select Committee, which Macleod has chaired since December.
MPs on the committee have no control over which projects will be progressed after the bill is passed, but can suggest changes to the legislation.
Te Pati Maori co-leader Debbie Ngarewa-Packer believed their relationship represented a significant conflict of interest.
"When you have the chair of that committee, who has received $10,000 from one of those who is going to hugely benefit from the changes to the legislation, then that's wrong."
Brown told RNZ nothing untoward had happened.
"When I made that donation, in my personal capacity, we had no knowledge that he was going to be in fact an MP, or whether in fact he was going to be appointed to that role. That's just something that has unfolded as time goes by," Brown said.
In a statement to RNZ, a spokesperson for the National Party said there was no conflict of interest in relation to Macleod's role on the committee.
"The committee is hearing submissions on the fast track legislation, not considering projects which might apply to be considered for the fast track process," the statement said.
The prime minister has said Coromandel MP Scott Simpson would replace MacLeod as the environment committee's chair.
Simpson is a former associate minister for the environment, as well as National's environment spokesperson in opposition.
"Scott's got great experience, knows the portfolios well, and will be really excellent in the job," Christopher Luxon said.
The committee will next meet on Thursday to elect the chair. Simpson said there was still a process to go through, and did not want to get ahead of himself.
"I'm looking forward to joining the committee. I've been on the environment committee in a previous Parliament, and in fact chaired the Parliament environment committee previously. So I'm looking forward to getting back to that area of policy work."
Simpson had already subbed in on the committee on the fast-track legislation, so was already "au fait" with it, he said.
"It's a big, meaty piece of legislation. It's a pivotal point of the coalition government's policy agenda. So I'm looking forward to getting my head around that again as a member of the select committee."
It's not yet clear when MPs will report back on the bill, but Simpson doubted the change to the committee's membership will delay its work.
RNZ
