A UNION leader has expressed his fears that a leading employer is poised to pull out of the region after it ditched a bid for a multi-million-pound contract.

Amec withdrew from the tendering process for a £25m fabrication contract for the Britannia North Sea oil programme that would have created more than 1,000 jobs in the North-East.

The company claims there would be a potential conflict of interest because it is already the project manager for the operation.

However, Tom Brennan, regional secretary of the GMB union, said Amec was in pole position to win the contract and added that, far from there being a conflict, there was a synergy that would have benefited the customer.

He is now concerned that Amec is paving the way to quit Tyneside and possibly leave the North-East completely - which would jeopardise the jobs of more than 1,000 workers.

Mr Brennan said: "I think the company is planning to clear out. I am not just refering to Tyneside - I am speaking for the whole North-East.

"The industry has peaks and troughs, but I am concerned the long-term strategy of the company is to withdraw from fabrication."

He said that the fabrication part of the business was very labour-intensive and that the region had the workforce with the necessary skills.

Amec spokesman Frank Stokes said the company had shelved plans to bid for the BritSats contract to build a satellite bridge-linked platform at a very early stage.

He said: "We have decided to withdraw from the tendering process. The reason for that is we are currently doing engineering and contract management for the project. For us to enter into the fabrication would be a conflict."

Amec performs a range of operations from bases in Darlington and Tyneside, in addition to the fabrication work at Wallsend, North Tyneside.

The Wallsend yard has been mothballed since work dried up last month. A total of 200 designers are still based on the site, but the fabrication work has stopped.

"We do not have anything coming through in the short-term," said Mr Stokes. "Fabrication opportunities in Europe are very limited at the moment. We are looking beyond there to Africa and the Far East.