Palumbo Shipyards has agreed to submit an application to Mepa for an environmental permit which would establish a legally binding framework for the environmental performance of the shipyards.

The application will be submitted shortly, and will be followed up by further technical discussions, Mepa said.

The granting of the permit would be subject to a public consultation process.

The decision was taken after a meeting between Palumbo and Mepa officials where Mepa reiterated its stand against pollution that resulted from recent grit blasting at the shipyard.

The Authority said that Palumbo also committed itself to identifying measures that would result in immediate improvements. These improvement measures would need the prior approval of MEPA.

In a statement last week, Palumbo said that grit blasting was safe and consonant with accepted practices across Europe. This, the company said, would be shown to all competent authorities at the appropriate time.

"Palumbo is aware of and will seek to abide by its neighbourly obligations but at the same time has a paramount duty to ensure that the interests of its stakeholders, including the employees who earn a living within the shipyards, are not prejudiced by issues that have never been raised before and that have no basis in law or in fact," the company said.