HUNDREDS of North-East jobs were in the balance last night with engineering firm Kvaerner facing collapse.

The Anglo-Norwegian firm, which employs more than 500 workers on Teesside, said it could face bankruptcy by Monday.

Bosses said job losses could follow unless a deal was struck to sell off one of its operations in the next 48 hours.

Unions said they were demanding a meeting to request more details on possible cuts.

Kvaerner desperately needs to tie up a £100m deal for its non-core assets to stave off action from the banks.

This would mean the sale of Kvaerner's profitable chemical research facility at Stockton, which has about 60 staff.

It develops processes for the chemical industry, which are then sold under licence to companies around the world.

Kvaerner, which last year sold off bridge builder Cleveland Bridge, in Darlington, has debts of more than £750m.

Last week, it announced a preliminary agreement with its largest shareholder, Russian group Yukos Oil, to hive off its hydrocarbon and process technology activities.

But this is yet to be completed, which could result on Monday in a cash crisis which Kvaerner describes as a "critical liquidity situation".

Spokesman Paul Emberley said: "We are in a critical situation and we cannot rule out bankruptcy on Monday.

"It is also impossible to give any kind of guarantee over jobs, which we realise is very unsettling for our employees, customers and suppliers."

Graham Tran, of the Amalgamated Electrical and Engineering Union, said: "We are concerned for jobs and want to save any that we can so we'll be looking to speak to Kvaerner as soon as possible."

Kvaerner's chief executive, Kjell Almskog, who resigned on Wednesday, has over the past two months agreed short-term loan facilities worth £102m.

But legal conditions are thought to be holding up the immediate payment of the much-needed cash