HISTORIC canals running through the Five Valleys are to be given a new lease of life after the final slice of regeneration cash fell into place this week.

Thunderous cheers and piercing whistles greeted Wednesday's announcement at Ebley Mill that the final £18-million chuck of funding had been approved for the rebirth of Stroud's canals.

Grants of £11.9-million from the Heritage Lottery Fund and £6-million from the South West Regional Development Agency (SWARDA) mean the once bustling waterway between Brimscombe Port and Stonehouse will once again bring prosperity to the Five Valleys.

"I couldn't be more pleased, it's a brilliant start for 2006," said Chas Fellows, leader of Stroud District Council, which is involved in the scheme.

"I'm absolutely delighted - it's great for Stroud and great for Gloucestershire," added British Waterways' regeneration manager Andrew Stumpf, who has spearheaded the ambitious project which is set to draw thousands of visitors.

It is hoped the rebirth of the canals will herald a boom-time for the area's economy and attract a raft of leisure and tourism industries.

Stonehouse mayor Mattie Ross expressed her delight at the news.

"It is the biggest thing for a while for the area and it's not just the canal that will benefit," she said.

"We are all really thrilled and it will do wonderful things for Stonehouse."

The restoration is set to begin in the summer once planning consent is approved and work is due be completed by the end of 2008.

Adrian Tinniswood, chairman of the south west committee of the Heritage Lottery Fund revealed that the decision was only confirmed 45 minutes prior to the announcement.

"There were lots of elements to consider as this is a massive bid," he said.

"Now there's plenty of work to be done but we're expecting more than 200,000 visitors a year to come and enjoy the canal when it's finished."

And Ian Knight, head of operations at the South West Regional Development Agency said: "For us the key thing is the economic benefits the canal will bring for Stroud and Stonehouse."

"Without a doubt Stroud has some wonderful historic industrial buildings and restoring the canal will help make the best use that legacy and heritage."

A fresh £15-million bid to the National Lottery's Living Landmarks Fund was submitted in December to enable restoration of the canal between Stonehouse and Saul.

This crucially link would connect Stroud to the rest of the canal network via the Gloucester and Sharpness canal.