Director Peter Jackson lives in Wellington

The world premi�re of the final Lord of the Rings movie could be taken away from the New Zealand capital, Wellington, in a row over the state of its biggest cinema.

The city's council has changed its mind over providing NZ$7m (US$4m, �2.5m) needed to restore the run-down Embassy cinema and improve its earthquake protection.

Film studio New Line has now threatened to move the prestigious event to Los Angeles, while Auckland has offered to step in as host city.

Much of the Lord of the Rings trilogy was filmed in New Zealand, and director Peter Jackson lives in Wellington.

At the premi�re of the second film, The Lord of the Rings: The Two Towers, at the Embassy, Jackson and New Line said they would return to Wellington for the final premi�re.

But according to the Dominion Post newspaper, Mayor Kerry Prendergast said the council would now provide about NZ$2m ($1.15m, �700,000).

The third Lord of the Rings movie will be released in December

That would have to be matched by the cinema's own fundraising, she told the paper.

"The question is not whether we will carry out the work required, the question is how much work is required," she said.

"Once that is established, we will do it.

"There was a clear message from the council that the quantum of $7m was too much but we have never closed the door."

The newspaper said the main issue was whether extensive work needed to be done to make the cinema earthquake-proof.

"What was once a full earthquake upgrade now appears to be a cosmetic makeover," the paper said.

'No requirements'

The council decided to provide the NZ$7m in March.

But Mayor Prendergast reportedly said that pledge was revoked because "no refurbishment requirements had been laid down" by New Line.

The next day, New Line executive producer Mark Ordesky said the premi�re would go to LA if the work was not done.

The 79-year-old cinema claims that it "captures the romance and glamour of yesterday and combines it with today's technology".

The trilogy is thought to have pumped about NZ$350m (�200m, �125m) into the New Zealand economy.

The Lord of the Rings: The Return of the King is due to be released around the world on 17 December.