A North East company has this week revealed plans for a new £50m recycling centre that has a "giant pressure cooker" technology it claims could single-handedly solve the problem of recycling mixed waste streams.

Graphite Resources Ltd said it has raised £50m, including a round of investment from banking giant Lehman Brothers, to fund the building of the world's largest steam autoclave recycling plant on the banks of the river Tyne in Gateshead.

Michael Thompson, chief executive at the firm, said that the 18m-long steam autoclave would hold 30 tonnes of waste and would work like a "giant pressure cooker", injecting steam at temperatures of up to 160 degrees Centigrade into the autoclave for an hour at a time. "The steam breaks down all the organic matter to cellulose lignose material, while metals, plastics and glass are all steam cleaned," he explained. "The material can then be easily separated for recycling with less than 20 per cent of the resultant waste having to be sent to landfill."

He added that the cellulose material could be used to generate power through anaerobic digestors or could be combined with an undisclosed "magic ingredient" for use in a binding substance for construction projects.

Graphite Resources claims the technology will allow councils and firms to recycle mixed "black bag" waste, cutting down the amount of waste being sent to landfill and providing a greener alternative to incineration.

Thompson said that with the landfill levy set to reach £48 per tonne by 2010 there was also a cost saving associated with the approach.

In addition to making money from the recycled material, the company plans to charge a gate fee on waste entering the site, although Thompson insisted the cost to customers would be competitive to "landfill disposal".

He also argued that providing firms and councils with the ability to recycled mixed waste would help drive up recycling rates. "There are areas now where people have three or even five bins and unfortunately there is a limit to what you can do with that approach," he said. "You will never get everyone to separate their waste and that is where technology can offer an answer."

The company said the new facility was scheduled to be operational in the fourth quarter of next year and would be able to treat 320,000 tonnes of municipal solid waste, 60,000 tonnes of light waste and 20,000 tonnes of green and skip waste per annum.