UP to 80 more US navy "ghost ships" could be heading to the North-East for dismantling, the firm at the centre of the row told a committee of MPs yesterday.

And Able UK predicted it would soon be scrapping British warships, as the Government accepted it could no longer risk environmental damage by sending them to developing countries.

Giving evidence to the all-party environment committee, chief executive Peter Stephenson revealed Able UK had "an option" to bring over about half of America's 165 redundant ships.

A deal for 80 ships would dwarf the agreement covering the four awaiting dismantling at the company's Graythorp site in Hartlepool, or the nine further ships due to make the journey.

In addition, the British government -- under fire for sending its defunct warships to cut-price India or China - has entered into talks for two to be scrapped at Graythorp.

Mr Stephenson told the MPs the blaze of publicity surrounding the ships, dubbed "toxic timebombs", by campaigners, had "shown how strong public opinion can be".

As a result, large companies, such as BP, did not want to be condemned by environmental groups and would no longer accept the "cheapest price" in the Third World.

Mr Stephenson said: "We are in discussion to bring over half of the American ships. That's still an option open to us. No one can compete with our facility on environmental grounds."

He added: "We and the US government are trying to do it properly. The US government should be applauded for spending money for trying to do it correctly."

Mr Stephenson said the American deal would pump £35m a year into the Teesside economy and create 1,000 permanent jobs. Ship recycling could be worth £3.5bn by 2010.

But he conceded the court action that was still preventing Able UK from dismantling the first four ghost ships had "hurt us very badly".

Staff had been made redundant for the first time in the company's 38-year history and its future was in jeopardy if the stalemate continued deep into next year.

Work on the four ships cannot begin until the company has secured planning permission and relevant licences.

And a US court hearing to decide whether the further nine ships can cross the Atlantic has been put back until October.

Mr Stephenson revealed it would be April at the earliest before any ships could be scrapped, with the bill for a fresh environmental assessment rising to £300,000.

But he said: "We are very confident the work will be undertaken.

"There was never any suggestion from the regulatory authorities of a risk to the environment from what we were doing."

The chief executive attached evidence from Greenpeace exposing conditions in India, where asbestos-laden ships were run up on a beach and washed by the tide.

In contrast, he said, Able UK had a strong record of dismantling more than 50 oil rigs and gas structures and disposing of their hazardous waste safely.

Mr Stephenson won support from Michael Jack, the committee's Tory chairman, who said: "You are an expensive solution, but you want to use the best practice."

The environment select committee launched its inquiry after the wider problem of dismantling defunct ships was brought to light by the ghost ships furore.

Greenpeace told the MPs that one British port - perhaps Teesside or Tyneside - should be set aside for state-of-the-art facilities for scrapping old ships from Britain and Europe