NORTH-East workers at engineering firm Amec will not be affected by the Government's decision to pull the plug on a £1bn carbon capture project in which its Tees Valley offices were heavily involved.

In October last year designers at Amec's office at Wynyard Park, near Stockton, were chosen to lead a study into plans to capture more than two million tonnes of carbon dioxide per year from Longannet Power Station, in Fife, Scotland and transport it for storage under the North Sea.

Yesterday the Government said it would not be proceeding with its backing for the project, for which it had earmarked funding of up to £1bn, as the length of pipeline needed to take the CO2 to the undersea reservoirs made the scheme unviable.

Amec had been contracted by National Grid, part of the consortium behind the scheme which also included plant owner Scottish Power and Shell, to carry out the front-end engineering design, or Feed, looking at the transportation part of the CCS project.

Last night a spokesman for Amec said the firm's CCS team, which since last year has moved from Wynyard to the companys industrial headquarters in Darlington, had already completed their part in the project.

He said: "We finished this work a few months ago and our people are back in Darlington doing other work."

The value of the contract to Amec had never been disclosed but when it was awarded the company said that winning the business would help to secure North-East jobs and potentially lead to further work in the sector.

Yesterday Energy and Climate Change Secretary Chris Huhne said the problems at Longannet were specific to that project, focusing on the length of a pipeline between the plant and reservoirs for storing carbon.

Mr Huhne added that it had not been possible to reach a satisfactory deal on the scheme and as a result we will not be proceeding with the project.

He insisted the Government was still committed to carbon capture and storage schemes and said the 1 billion funding would be available for other projects, with a number of promising bids from both Scotland and England expected.

We now know that commercial-scale carbon capture and storage projects are technically viable and are likely to be financially achievable, he said.

Scottish Power had planned to retrofit the technology to the existing coal-fired power station, which it said would eventually capture up to 90per cent of the plants carbon emissions.

Speaking on behalf of the consortium behind the project, Scottish Powers generation director, Hugh Finlay, said: Our combined efforts have seen this potentially world-changing technology develop from being a concept in a laboratory to a definitive blueprint that could be implemented.