Developers have denied reports that the reopening of the millennium dome could be delayed until 2007.

The denial came after the Guardian newspaper reported that the 24-month project to turn the attraction into a 26,000-seat sports complex may not start until 2005.

Such a delay would cost the taxpayer an estimated £10.5 million.

It follows government figures earlier this year which revealed that the bill for keeping the Dome empty since July 2001 stood at £22.9 million.

The Office of the Deputy Prime Minister argued that the companies behind the project, the Anschutz Entertainment Group (AEG) and Meridian Delta Limited (MDL) were right for the job, but confirmed that work will not start for another two years.

"Subject to planning permission being secured in early 2004, Anschutz and MDL aim to start work on the arena and proposed wider development in 2004/05," said a department spokesman.

"The build-out programme and opening arrangements are a matter for AEG."

However, the reports were later denied by MDL.

"We remain firmly on track to start development on the Greenwich Peninsula in 2004," said spokesman Nick Shattock.

"We and Anschutz Entertainment Group remain fully committed to the regeneration of the Greenwich Peninsula and to delivering for London new jobs, new homes and a new world class arena inside the dome.

"The planning has proceeded with tremendous pace, with goodwill all round and a joint desire to get started on site as soon as possible.

"There is no delay - the project is making excellent progress with development starting next year."