The ship was found in June 2002

A meeting to resolve the dispute between the Glamorgan-Gwent Archaeological Trust (G-GAT) and the authority is taking place on Tuesday afternoon.

The charity says it will serve a writ if negotiations do not succeed.

Newport council has refused to comment on the details of the dispute with the trust.

But a spokeswoman has confirmed a meeting will take place over contractual matters.

The 15th century trading ship lies on the site of Newport's new arts centre and the vessel - which pre-dates Henry VIII's famous flagship the Mary Rose - has attracted hugh public interest in the city.

Charles Ferris, from Save Our Ship

Bob Trett, chairman of G-GAT's trustees, said the financial dispute has arisen because the work was complicated and over-ran at the site.

"This has very serious consequences for the trust and for the future of the ship," said Mr Trett.

"It (the project) requires continuity, the council hasn't - as far as I know - got anybody else on line," he added.

Mr Trett said it was initially thought the ship could be removed from its muddy bank in sections but experts had to remove the ship timber by timber.

"There were three times as many timbers as estimated," he said.

Work began on the ship last autumn and G-GAT staff came off site in December 2002.

Mr Trett added: "We can serve a writ and we will serve a writ but we want to give negotiations a go."

But the trust maintains if receivership occurs, then implications for other local councils are far-reaching.

The medieval ship, which was awarded a �3.5m Welsh Assembly government grant, was found in the site of the proposed orchestra pit of Newport's new arts centre.

Around 2,700 pieces of the ship are in special water tanks at the Corus steelworks at Llanwern.

G-GAT provides planning advice for 12 authorities across south Wales.

"From Swansea to Monmouth there will be tremendous chaos in their planning practices, there will be delays all over the place," said Mr Trett.

'Massive fragment'

Charles Ferris, from the pressure group, Save Our Ship, said the pressure group's members are still pressing for work to continue.

They want to see the bow and stern raised.

Mr Ferris said: "Our fear is nothing is going to happen.

"Also I would like to know about the starboard quarter - that's a massive fragment of the ship.

"If you get the starboard quarter you can probably get the footings of the stern castle."

He added: "The Newport ship will be world famous, it's amazing."