A LAND-swap deal that will see a developer build a new primary school in Peterlee looks likely to win council approval today.

Modus Properties has offered to pay for a new North Blunts Primary School for Durham County Council as part of its multi-million pound regeneration of the town centre.

In return, the company will take over the current school site for a shopping development.

The county council's executive committee will be recommended to approve in principle the transfer of the school from the start of the spring term, in 2002.

The school has places for 379 pupils, but currently has only 232 on its roll, which is not expected to rise significantly in the next few years.

The school buildings are also used by a private day nursery, which is run by East Durham and Houghall Community and Howletch Play Group.

Modus plans to build a 240-place school on a nearby site, with provision for early years education.

A report to the committee says that the current school needs £500,000 worth of repair and maintenance over the next five to ten years.

Like many schools in the county, there is asbestos in the building.

The school's governors support the relocation proposal, but would like to see a county council-run nursery at the new site.

Residents are concerned that the retail development and the relocated school could lead to traffic congestion.

However, county council officials say that traffic issues will have to be looked at when planning agreements are drawn up.

Education director Keith Mitchell said: "Should the proposed relocation of North Blunts Primary School take place, it is envisaged that the full capital cost would be met by the developer of the existing site.

"The proposal would assist in eliminating surplus capacity, while developing a new school designed to accommodate current educational practices while being energy-efficient.