A £47m investment in a new seed crushing plant will create 45 jobs and secure hundreds more.

Tees Valley Biofuels (TVB) has announced plans to build the UK's first major new oil seed rape processing plant in a generation, as part of plans to put the region at the centre of the renewable fuels industry.

The plant will be the first of its kind in the North-East and will secure and create jobs in farming and transportation, as well as hundreds during construction.

It will crush 500,000 tonnes of rape seed a year to create oil, which will then be supplied as a feedstock to biodiesel manufacturers.

The company is in talks with a number of biodiesel companies, and The Northern Echo understands it may supply the Biofuels Corporation, which has built one of Europe's largest biodiesel plants at Seal Sands.

TVB is a privately-owned company backed by private and equity investors. It is currently negotiating a lease on land for the plant with an existing Tees Valley firm and will be submitting its request for planning permission next month.

It is now seeking extra funding to start the main engineering work.

Construction work is expected to begin later this year and it is hoped the plant will be commissioned in the first quarter of 2008.

Ian Waller, recently appointed to the board of Tees Valley Biofuels as managing director designate, said: "This project builds on one of the natural strengths of the region in growing crops for industrial processing, and it's great that the products we will be making will help sustain the growing renewable energy market sector - one that is developing into a major new industry for the North-East."

TVB is hoping to secure funding from regional development agency One NorthEast for the new plant.

Mr Waller said TVB would "definitely not" be floating on the stock exchange as a way of raising funds.

Thornaby-based K Home International has been appointed as main contractor for engineering, procurement and construction.

Before the plant goes ahead, TVB has to secure oil seed rape suppliers and also agree terms with customers.

Farmers are being asked to commit themselves to growing the crop for the plant.