A £157m river tunnel to alleviate traffic in one of the North-East's most densely populated areas could still go ahead despite a setback to a regional transport blueprint.

The tunnel, crossing the River Tees from the A66 at South Bank, Middlesbrough, to the Seal Sands Road at Haverton Hill, between Stockton and Billingham, is part of an ambitious transport blueprint drawn up by consultants Mott MacDonald.

But assessors said the tunnel project was the only ambitious transport scheme likely to be financially viable.

However, it would be a huge undertaking that would require massive investment from central government.

The other schemes - a tram system linking Teesside with Darlington and a new guided bus scheme - were unlikely to make a profit by attracting enough drivers to leave their cars at home.

The Tyne Tunnel took two years to complete. It opened in 1967 and the Government has only recently given the go-ahead for another Tyneside underwater link.

The study, funded by One NorthEast and managed by the Tees Valley Joint Strategy Unit, found that a marginal economic case for the Tees tunnel could be made. It would cost about £157.3m.

But they say it would depend on the level of traffic growth from developments being higher than Department of Transport high growth forecasts.

Andy Hyams, from the unit, said the report was only a draft and that the final report, expected later this month, may either confirm or amend the findings in the draft report.

The provision of a Metro public transport system, guided bus, or tram operation to improve access from employment sites to disadvantaged residential areas was also examined.

But it was found that none of these systems would be likely to generate a level of income to cover construction costs because not enough people would use them.

Instead, the report recommends making changes to the existing bus network and highway and public transport infrastructure.