A senior inspector's report on the controversial Irish Glass Bottle site, seen by the Sunday Tribune, warns that dangerous emissions of methane gas mean only costly structures, such as buildings on stilts, can be contemplated for the area and adjoining Dublin docklands sites.

The report will scupper the slim chances the Dublin Docklands Development Authority (DDDA) have of retrieving more than €100m of state money spent on part-purchasing the near 25-acre site in 2006. The presence of methane will force the developers to opt for lower floors "raised above ground level''.

It will also likely add fire to the legal battle involving the DDDA, co-developer Bernard McNamara and clients of Davy Stockbrokers.

Experts say other nearby docklands sites, including Liam Carroll's adjoining Fabrizia site, could face similar issues with methane gas produced by domestic waste.

The report shows methane gas emissions buried in a five metre layer was at concentrations of up to 28% in some test wells at the Glass Bottle site.