The environmental clean-up of more than 600,000 gallons of oil and sludge deposited in a cave at the former Royal Navy base at HMS Malabar, will cost Britain $1 million, it emerged yesterday.

But the money will be found from the current budget to pay for the work because the new Labour Government considers the environment a priority.

"We are looking at about $1 million which has not been easy to find because it is coming from the current budget,'' said Brian Brader, a senior official in the Ministry of Defence.

"But it comes down to priorities in the end. We have a new Government and one of their priorities is the environment and its protection.

"This clean-up reflects both our priority and our commitment to the environment.'' Meanwhile, Premier Pamela Gordon, who attended the commissioning ceremony along with Governor Thorold Masefield and Environment Minister Irving Pearman, said that she was pleased that the British Government had followed through on its promise.

And she said that she was hopeful the United States Government would also come to the Island's aid in the clean-up of its former bases.

She said: "I am more than pleased that the UK Government has honoured its commitment. We will use this as leverage in our negotiations with the United States.

"We will send word to the Department of Defence in the United States Government and let them know of the commitment of the UK Government who have started this cleanup.

"There are similar circumstances involved here and we will be asking the Americans to come to the wicket.'' A spokesman from the US Consul General's office declined to comment when contacted by The Royal Gazette .

It is understood the US Government it is not prepared to clean up the former base lands unless there was "clear and imminent'' damage.

The US Government are worried that if it is persuaded to clean up the environmental damage in Bermuda, it will have to do similar jobs in other countries at immense cost.

But Ms Gordon said: "In our view, the American Government does not have the right to pollute the rest of the world.

"We realise that they have some difficulties, but Bermuda is a unique circumstance because of our size. We do not have a large land mass that we can hide this stuff and we feel that there is clear danger. This residue is affecting our ground water.''