Definitely check with the Building Dept.,shortcircuit, but personally I'd update the grounding on principle, and wouldn't be too keen on pulling new service wiring into an old panel.
Usually I have requests for a new interior panel using the old exterior work. I think the only time I changed the outside without replacing the panel is when a truck hit the overhead wires and dragged the exterior work down. Inside was a fairly recent SQ D QO panel.
I just tell people the service involves both the interior and exterior and the grounding needs to be updated at the same time. I don't really give inside or outside alone as an option except where there is a pedestal meter socket in good shape.
Dave
