ENGINEERING company Amec has its sights set on three new contracts.

The offshore engineering group confirmed yesterday that it was laying off the majority of its workforce at its Tyneside shipyard after it failed to secure any further orders to replace contracts due for completion in June.

A spokesman last night confirmed that there were three possible contracts the company could win - creating jobs, but not quickly enough to halt the current wave of redundancy.

Spokesman Frank Stokes said: "We have got three opportunities we are pursuing at the moment. We do not currently know when we will be notified of the outcomes."

It is believed that if the contracts are won, the work would not arrive for several months.

He said: "This is the very nature of the industry and our workers understand that.

"We have a good relationship with the unions and we have kept them well informed."

The yard's last order, which was a multi-million pound deal to build gas and oil equipment for BP, will be finished by June, and no new orders have been won in time to secure jobs.

Construction staff including welders, pipe fitters and riggers, will start leaving the yard within weeks.

But some staff will be kept on for several months to carry out the installation of the equipment on an offshore rig.

The yard will be maintained in preparation for further orders, and a design team of 200 will be kept on.

The redundancies came amid uncertainty at neighbouring Swan Hunters, where the company needs to win more orders by 2006 or face laying off 1,500 workers.