Prudential planned to store excess flood water in Theale Lake

Prudential withdrew its application to build 7,500 homes at Kennet Valley Park, near Reading, on Wednesday after a long-running campaign by protestors.

The Environment Agency had rejected the proposals on flood-risk grounds.

Prudential, which planned to put excess water in an upstream lake surrounded by a 9ft (2.7m) wall, said issues raised by campaigners were being considered.

We feel that it is important to address the concerns raised Kevin Ashman, Prudential

Geoff Bell, of the Environment Agency, said: "It seems that Prudential have listened and common sense has prevailed.

"I was very interested to see that they're going to revisit some of the issues, particularly, ecology and, for us, flood risk.

"The whole of the site is several thousand acres, and not all of that is flood plain.

"We have sat down in the past with Prudential and said 'if you restrict your development to the non-flood plain, then I'm sure we could work with you'."

Kevin Ashman, of Prudential, said: "We have looked carefully at the responses received by the local authorities and we feel that it is important to address the concerns raised."

An amended application is due to be submitted to West Berkshire Council, Reading Borough Council and Wokingham District Council early next year.