THE long-awaited Circuit of Wales project in Ebbw Vale has been killed off for good.

The project, which would have involved a racetrack as well as hotel and other facilities on a site in Ebbw Vale, was first announced in 2011, only to be twice turned down by the Welsh Government over concerns around the amount of public investment required.

A third application, which reportedly met a requirement set by economy and infrastructure secretary Ken Skates of being no more than 50 per cent funded by the public sector, was submitted earlier this year. But yesterday, the Labour AM announced this had also been refused.

The scheme has already cost the Welsh taxpayer more than £9.3 million.

In 2012 the Welsh Government handed the developers of the scheme, the Heads of the Valleys Development Company, a £2 million grant, and, in May 2016, it was forced to pay out more than £7.3 million to Santander after it recalled a loan the firm was unable to repay.

In a statement issued yesterday morning, Mr Skates said entering into an agreement with Heads of the Valleys would “place a significant limit on our ability to deliver current and future projects to improve Welsh infrastructure, housing, hospitals or schools”.

“With our current limited borrowing ability, cabinet therefore today decided that the potential impact on the public finances of the current proposal before them was too great, when considering the many other priorities for the public purse, and decided that the Welsh Government is unable to offer the financial guarantee requested on this proposal,” he said.

Instead, the Welsh Government is planning a new automotive technology business park in Ebbw Vale, which it says will be funded with £100 million over the next 10 years and could create up to 1,500 new jobs.

A depot for the planned South Wales Metro will also be set up elsewhere in Ebbw Vale.

Announcing the decision in the Senedd, Mr Skates said: “I do recognise that many people in Ebbw Vale and across South Wales will be disappointed by our decision, especially as the company has generated some very high expectations of the jobs that would be created.

“In addition, many people were pinning their hopes on this project to bring wider economic benefits for the south Wales Valleys, particularly the broader Heads of the Valleys.

But Mr Skates said, although the heads of the Valleys Development Company has claimed the project could create up to 6,000 jobs, examination of the application said the final figure would “fall substantially short” of this.

He said the circuit itself would create around 500 jobs during construction and a further 600 once complete, although connected businesses would create more new roles.

“Politics is about difficult decisions, and today’s in relation to the Circuit of Wales was no exception,” he added.

“I do not take the impact of this decision lightly, and neither do my cabinet colleagues.

“We made every effort to make this project work.

“However, this is about getting the decisions right, and getting the right investment into Blaenau Gwent and the wider south Wales Valleys, investment that is sustainable, long term and that genuinely benefits local communities.”

The project’s chief executive Martin Whitaker said he was “hugely disappointed and saddened” by the news.

“We strongly disagree with the decision and the rationale behind it,” he said.

“We have always believed passionately, and continue to do so, in this project’s ability to transform and provide opportunities and hope to one of the poorest parts of the UK, not just Wales.

“The project is totally defined, finance is in place, and construction and hiring could start immediately.

“My team and I will now analyse the Welsh Government’s reasons not to support the development and are actively seeking additional clarification from them.

“We will then very shortly issue a detailed response before deciding on our next course of action.”

Reaction to the news has varied from disappointment to outright fury.

Blaenau Gwent MP Nick Smith said he was “very disappointed that the premise of the Circuit of Wales didn’t live up to the reality” and said he would be calling for an emergency meeting with Welsh ministers to discuss the decision.

“The Circuit of Wales has been selling a vision which, if delivered well, offered jobs and a new kind of industry for the area,” he said.

“The Welsh Government, and all those who supported the Circuit, gave this project a chance to succeed.

“I argued this circuit could be a game-changer and helped where I could to give it a realistic shot.

“Yet it’s also become clear that the deal could still have put all the risk onto the Welsh taxpayer.”

His assembly counterpart Alun Davies said he was “profoundly disappointed”.

“I have supported the development of this project for seven years,” he said.

“I have worked hard to try to make the project one which could support and sustain good well-paid employment in Blaenau Gwent for years to come.

“But this community has had enough promises. We need action.

“For me it is the jobs, the skills and the opportunities for our young people that are at the heart of what I want to see in Blaenau Gwent.”

But Plaid Cymru’s shadow finance secretary Adam Price said the length of time it had taken to get to this point was “a shocking indictment” of the Welsh Government.

“The Welsh Government has today turned down the single biggest private investment proposal in the history of Wales,” he said.

“Investors like Aviva will think twice before ever investing in the south Wales valleys again.

“Other partners may have recourse to legal action whose costs could run in to tens of millions of pounds.

“Is Wales open for business or open to ridicule?”

Welsh Conservative shadow economy secretary Russell George said the decision contradicted claims by Welsh Government officials made during a committee meeting the day before that the scheme represented “good value for money”.

“The decision not to proceed with support for the Circuit of Wales will disappoint Blaenau Gwent residents, but it does provide clarity after many years of uncertainty and hope,” he said.

“There will also be a great deal of cynicism about the new plans for an automotive technology business park in the area.

“Ebbw Vale has been designated as an enterprise zone for several years and has been spectacularly unsuccessful so far.”

And leader of the Senedd’s Ukip group Neil Hamilton said the decision had served to “kill the hopes of the people of Blaenau Gwent and a much wider area”.

“What this shows is a pathetic lack of vision on the part of the Welsh Government to kill this massive private enterprise scheme, which offered not just hope to one town in Wales, but actually to the whole of south east Wales,” he said.

Torfaen AM Lynne Neagle, meanwhile, said to Mr Skates: “I have been a supporter of this project, as has my local authority in Torfaen, believing that it would be a transformative thing for the Heads of the Valleys area, particularly with our strong record of automotive manufacturing in Torfaen.

“I too am puzzled that we could hit such a major stumbling block at such a very late stage after seven years of consideration of this project.

“I do think there are very serious questions that need to be answered and I will look forward to seeing the information on the due diligence that you’ve committed to publishing.”

The leader of Blaenau Gwent County Borough Council, councillor Nigel Daniels, said: “We recognise that the Circuit of Wales scheme had the potential to bring transformational change and significant economic benefits to the area and surrounding communities.

“But we have to accept today’s decision by Welsh Government and its advisors.

“However, we welcome the announced £100 million investment for a new automotive technology business park in Ebbw Vale and the employment opportunities promised with this development.

“We will also be seeking urgent meetings with Welsh Government and other parties to explore other options that can be brought forward to mitigate the impact of this decision given the level of expectation which has grown in the community over the last few years.”

Environmental groups had campaigned against the scheme due to the potential damage they said it could cause.

And, speaking yesterday, the chief executive of Gwent Wildlife Trust Ian Rappel welcomed the news.

“The Welsh Government’s decision regarding the Circuit of Wales will come as a bitter disappointment for anyone who believed the developers’ hype over jobs creation,” he said.

“But every cloud has a silver lining and there is now a real opportunity with enhancement of these ecologically precious habitats to create a ‘green gateway’ nature reserve stretching from the Eastern Valleys to the Brecon Beacons.”

“This upland area around Rassau is a real Gwent gem, a rich mixture of heathland, streams and acid grassland.”