The long quest to build a Lord of the Rings museum in Wellington appears close to an end, with city councillor John Morrison confirming plans for a site in the city centre.

Mr Morrison, a mayoral candidate and leader of the council's events portfolio, said Sir Peter Jackson's team was investigating two possible sites, which he understood to be Shed 1 on the waterfront and the old CitiOps building at the southern end of Tory St.

Planning was still in the early stages, but it was an exciting prospect, he said.

"From a Wellington point of view, we're very thrilled about it being in Wellington. We're not involved directly, but we've had a very interested eye on this process.

"I don't think anyone is yelling and screaming to get it done, but they're looking at two options at the moment."

Matt Dravitzki, spokesman for Jackson's company Wingnut Films, said the company had explored several Wellington sites over the years, continued to do so, and nothing was decided or resolved at this stage.

Wellington Mayor Celia Wade-Brown declined to comment on the project.

Mr Morrison said the council had always been very supportive of it, but had not been pushing to get it under way.

"The driving force always had to come from their [Wingnut's] side. We always wanted it . . . Things are moving, and hopefully we'll have a decision before we're all too much older."

A film museum would be a big draw for Wellington tourism. A Lord of the Rings exhibition at Te Papa in 2002, returning in 2006, drew 325,000 people and remains its most popular exhibit.

The Lord of the Rings film trilogy gave New Zealand visitor numbers a big boost, from 1.8 million in 2000 to 2.4 million in 2006.

Positively Wellington Tourism chief executive David Perks said it would present a great opportunity.

The Lord of The Rings and The Hobbit had become a big part of the Wellington story.

"A permanent attraction around film would give us a way of telling those stories every day of the year.

"We've got the Weta Cave, but something more significant would give us significantly more opportunity too."

In a recent tourism survey, 8.5 per cent of visitors to Wellington said The Hobbit was a deciding factor in their destination choice, Mr Perks said.

A Rings museum has been in the works since the first film, The Fellowship of the Ring, was released in 2001. Former mayor Mark Blumsky was among a team of bidders who visited New Line Cinema executives in the United States in February 2001 to negotiate the right to set up a permanent museum in Wellington.

His successor, Kerry Prendergast, picked up the cause in 2002, pleading with prime minister Helen Clark to support the proposal.

When Jackson bought Miramar's Capitol Court in 2003, there was speculation that it would house a permanent Lord of the Rings exhibition, but it was converted into the Roxy Theatre.

Plans also fell through to build the museum at the disused Shelly Bay air force base.

Shed 1 currently houses HeliPro Wellington and Wellington Indoor Sports. The Tory St site is home to Te Papa's zoologists, conservators and archivists, and a research library.

Wellington Waterfront chief executive Ian Pike said it had been in discussions with Wingnut Films about a museum site for about five or six years.

"There is nothing definitive whatsoever. We're in very early discussions, and we've been talking for a long time, but there is an elimination process that is going on."

Jackson's team had explored several sites along the waterfront but Mr Pike did not know if the team had narrowed it down to two.

Te Papa chairman Evan Williams said he could not confirm whether it was in discussions about a Lord of the Rings museum as he has been out of the country.

WHAT MIGHT BE IN IT?

Wingnut Films says the intention of the museum, should it eventuate, is that it would contain costumes and props from the productions associated with Wingnut and Weta Workshop, as well as props, costumes and models from many other films.

Te Papa's 2002-03 and 2006 Lord of the Rings exhibition was largely made up of costumes, weapons and miniatures, including a 17:2 scale model of Minas Tirith and Aragorn's sword Aduril, Flame of the West, from The Return of the King.

It is understood that, in 2003, Te Papa paid up to $500,000 to New Line Cinema for the exhibition. The 2006 licensing rights were signed over to Sir Peter Jackson.