"We have identified stress fractures on the ship. We can't rule out the risk of the ship breaking up, that's certainly being monitored," Key told reporters in Tauranga.

Up to 300 tonnes of heavy fuel has leaked into the environmentally sensitive Bay of Plenty since the Liberian-flagged Rena hit the Astrolabe Reef, 22 kilometres (15 miles) off the North Island coast, one week ago.

The ship is now listing at a precarious angle and up to 70 containers fell off into rough seas overnight, as a black tide of oil washed up on beaches.

Key defended the government's response to what is New Zealand's worst maritime pollution disaster.

"The government didn't drive the boat onto the reef. We're doing everything we can to try and ensure the situation is dealt with as fast and efficiently and effectively as possible," he said.

"I wish that boat wasn't spewing oil out into New Zealand's pristine sea, but it is and we're dealing with that."