REGIONAL development agency One NorthEast said it may provide troubled shipbuilder Swan Hunter with financial support.

The regional development agency has met the North Tyneside shipyard's management team for the second time in eight days to try and find a way to save Swan's Wallsend yard from being mothballed, with the loss of 800 jobs.

Before yesterday's meeting, yard owner Jaap Kroese said he was looking to One NorthEast for financial support to bolster Swan's bid for a contract with Swiss company Allseas to build a pipe-laying vessel. The contract could create more than 1,500 jobs.

Last night, David Allison, director of business and industry at One NorthEast, said: "We have had another productive meeting with Swan Hunter's senior management team, where we discussed ways in which we could potentially provide both financial and training support to the firm, as well as offer guidance and advice with regard to new contracts.

"One NorthEast is continuing its work with Swan Hunter to explore every avenue available to support the firm, working closely with the DTI and other regional partners at every stage."

Swans has been losing staff as work nears completion on the second of two Royal Fleet Auxiliary vessels. There are no further orders until 2008.

Mr Kroese is in talks with Dutch partners NV Ecodock about a possible £40m ship breaking business and has also applied to the Government for licences to dismantle ships at Swans.