"We are studying new documents submitted Saturday by the French side before making a final decision," an Egyptian official involved in the negotiations told AFP.

A former pride of the French navy, the 265-metre (875-foot) Clemenceau is destined for a scrapyard in India after leaving French waters on December 31 but has been anchored in the Mediterranean off the Egyptian coast since Thursday.

Its asbestos insulation has provoked controversy over its voyage and the health of Indian workers who will dismantle it.

"The (Suez Canal) Authority requires certificates proving that the ship meets environmental standards for passing through the canal," a source with the authority was quoted as saying by the official MENA news agency.

Paris has argued that the ship could not be considered scrap and submitted new documents to prove that the Clemenceau's voyage to India does not fall under the 1989 Basel convention banning the export of toxic waste.

"Our arguments have strong legal grounding and we hope to see a breakthrough on Saturday," a diplomatic source told AFP.

The dispatch of the Clemenceau by the French government to Shree Ram Scrap Vessel breakers' yard in Gujarat, west India, some 40 years after entering service has sparked fierce controversy in both countries. Critics accuse Paris of dumping its toxic waste on the Third World.

Two Greenpeace protestors who had boarded the carrier on Thursday were released overnight by the French navy and were due to arrive in Cyprus in the afternoon, Greenpeace spokesman Martin Besieux told AFP.

Greenpeace has been fighting to block the ship's transfer for months, arguing that Indian shipyard workers will be at risk of asbestos poisoning.

According to the French government, the vessel is carrying 45 tonnes of asbestos insulation. According to the firm that helped partially decontaminate it before the trip, the amount is between 500 and 1,000 tonnes.

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