CAMELOT Theme Park is to be demolished and replaced by an indoor water aqua park' as part of a plan to create a new village.

The award-winning Chorley attraction will be phased out within about five years, under a scheme by owners Prime Resorts, and housing companies Persimmon Homes and Miller Homes.

In recent years visitor numbers have been dropping from 600,000 10 years ago to around 300,000 projected for 2006.

Under the project, expected to take up to 20 years to complete, 1,000 homes will also be constructed in the area around Camelot and Park Hall Hotel.

The hotel will also be extended by 100 rooms, bringing its total to 250.

The plan is subject to planning approval by Chorley Council and it is expected the leisure development, which will include a health and fitness club, will create 300 extra jobs.

Bosses at Camelot-based Prime Resorts also hope to include everything needed for a community, from a village school, shop and pub to a creche, village hall and a bus service.

But today Chorley MP Lindsay Hoyle said he had not been consulted, and said the most important part of the scheme was to make sure residents' views were heard.

Roy Page, chief executive of Prime Resorts, said: "It will protect the site for the next 40, 50 or 100 years. It's inevitable Camelot Theme Park in its current form will close in the next five to 10 years. As a result we needed to look for alternative uses.

"Camelot cannot compete with the major theme parks, it's too small.

"We are unable to invest in the major rides. Our customers want more exciting, thrilling rides that we are unable to provide.

"We think this is the best way to protect the future of this site."

Camelot provides just 15 full time jobs, with a further 150 created seasonally when the park is up and running.

When it was opened in 1984 Camelot became a major tourist attraction for Lancashire, and has won awards including the visitor attraction of the year in 1999, as part of the North West Tourist Board awards.

In 1998 it was bought out by the management for £14million in a deal which included the Park Hall Hotel.

Prime Resorts say that the aqua park will be marketed towards the same age groups as Camelot theme park, but will be open all year round rather than just seasonally.

But Lindsay Hoyle, MP for Chorley, said: "I will be listening very carefully to what the resident's views are and what their opinions are.

"The residents in the area must be taken into account as this will have a major impact and I will be waiting to hear from them."

A display setting out the scheme will be on show for the public for the rest of the week at Park Hall Hotel.