United Utilities has hired Volker Stevin – a specialist marine contractor based in Morecambe – to excavate the area where an outpipe was crushed when the ill-fated cargo ship hit the beach off Anchorsholme.

A 20m by 20m stretch of beach will be sectioned off with barriers from Tuesday while workmen clear the area using excavators and a dumper truck.

Shaun Robinson, spokesman for United Utilities, said: "For the first time since Riverdance damaged the pipe, the contractors are going to dig down and clear the sand so we can get a look at the outpipe to understand how much damage has been caused."

The main construction will then start at the end of June when a cofferdam – an enclosure which displaces water to create a dry area to work in – will be erected.

United Utilities predict the work, which will cost between £1m and £2m, will take five months to complete.

The ship is believed to have caused structural damage to a 20m section of the pipe, which stretches a kilometre out to sea.

The stainless steel pipe, which runs into the sea from the Anchorsholme pumping station, transports storm water into the sea and provides flood protection for homes and businesses in Anchorsholme and Cleveleys.

Utilities will pay for the work initially but discussions are ongoing with Riverdance's owner Seatruck to see whether an insurance claim can be made to cover the cost.

Mr Robinson added: "It can still function but we have got to have it 100 per cent working. If we don't do it there is a risk of flooding."

Riverdance ran aground on January 31 last year and 23 crew members and
passengers had to be airlifted to safety.

Thousands of sightseers headed to Anchorsholme to see the stricken vessel which, despite desperate attempts to save it, was eventually cut up.

United Utilities has written to local residents to inform them of the work.

Mr Robinson added: "We have been speaking to residents in the locality to advise them. There will be some disruption but in terms of where people normally walk, there shouldn't be a problem."