The two highly-polluted American "ghost ships" which have courted controversy were last night facing the prospect of being turned back across the Atlantic after the Environment Agency withdrew permission for them to be dismantled in Britain.
The 58-year-old cargo vessels Canisteo and Caloosahatchie are expected to enter British waters off Falmouth on Wednesday before docking at the Hartlepool shipyard where they were due to be scrapped in a £16m contract involving 11 other former US naval ships.
The Environment Agency, which has been the subject of strong pressure from campaigners to ban the project, yesterday announced that it had withdrawn its approval for the British contractor, Able UK, to complete the work.
Environmentalists said the announcement represented a decisive victory in their battle to overturn the decision to allow the 13-strong fleet to be towed 4,500 miles from Virginia instead of dismantling them in American ship yards.
Each of the ships in the so-called "toxic fleet" is contaminated with chemicals including asbestos, heavy diesel and carcinogenic polychlorinated biphenyls or PCBs.
The Environment Agency, which originally said it was satisfied the project did not pose a pollution risk, said the waste disposal licence necessary for the operation was now invalid and several other permits from other authorities remained outstanding.
A spokeswoman said: "Despite our strong advice to the contrary, these ships have left the US without all the necessary permissions in place.
"We have reached a decision that the waste management licence is no longer valid and therefore the Able UK facility cannot be used. Among the options that they now have is that the vessels should go back to America." Friends of the Earth - which claimed that its threat of legal action against the Environment Agency was what had forced it to withdraw Able UK's licence - said it believed the decision meant the ships may not even be allowed to enter UK waters.
Phil Michaels, FoE's legal director, said: "There are grounds for arguing that these ships must not enter British waters because they have no current destination and represent a very significant pollution risk. The only justifiable course of action is for the Environment Agency to make it clear that they must return to the United States."
The decision to send the vessels across the Atlantic drew widespread criticism over the risk it would pose to wildlife. The EU environment commissioner Margot Wallstrom said last night that she hoped the ships would now be dealt with in America.
It is understood that the two vessels, which were due in Hartlepool on 9 November and are being closely followed by two more moribund cargo ships, may now head for the Azores to await further developments.
Able UK, which said the dismantling contract would create 200 jobs, had planned to scrap the ships by enclosing them in a rock-filled dam to form a dry dock which would be emptied to allow the work to take place.
The company last night confirmed that as well as its defunct waste disposal licence, planning permission applications relating to the dry dock were still outstanding with the Department for the Environment, Food and Rural Affairs.
Peter Stephenson, the company's managing director, said he believed the relevant permissions would still be granted.
Mr Stephenson said yesterday: "Given that similar approvals have been given in the past, we are confident that these will be in place by mid-November."
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