The Te Kaha and Te Mana were built by Tenix Defense systems, Australia's largest defense contractor in the mid-1990s.
"The frigates are a vital part of our Defense Force but the weapons and sensor systems were designed in the late 1980s and require a mid-life upgrade," New Zealand Defense Minister Jonathan Coleman said in a release.
The New Zealand Cabinet has approved a Detailed Business Case and a Request for Tender will be issued by the Ministry of Defense in early 2013 to replace the hardware and software of the Combat Management Systems on the ships, modernize the vessels' radars and sensors and replace self-defense missile systems.
"This will address issues of obsolescence with the ships technology as well as ensuring the vessels are a credible capability which can operate in the South Pacific and wider Asia Pacific region," Coleman said.
"The Defense White Paper 2010 identified the ANZAC frigates would require an upgrade by 2017 to address obsolescence, surveillance systems and anti-missile protection. The government is delivering on the White Paper."