Russell Ferguson, a spokesman for Lighthouse Caledonia, said the factory at Marybank had become "unsuited to modern techniques and has become inefficient".

However, the firm’s communications manager Su Cox offered a different explanation when she told the Free Press yesterday (Wednesday) that the firm’s desire to take all their fish directly by well-boat for processing could not be met at the current premises because the factory is too far inland.

She also explained that moving to a one-year class of fish in each of the three loch systems the company farms — Loch Roag, Loch Seaforth and Loch Gravir — is the reason why there may be no fish for the Marybank plant to process until May. Prior to this change each loch system contained different year classes which meant a constant supply of fish for processing, Ms Cox said.

"There are sites in the north of Scotland from where we could take the fish to Stornoway but that would be done by well-boat so we would be faced with the same problem of where the Marybank plant is," she added.

Discussions were ongoing, Ms Cox said, with Comhairle nan Eilean Siar and Highlands and Islands Enterprise, about possible funding for a new factory on the coast.

Western Isles MSP Alasdair Allan said he had been in contact with the company to find out their plans. A 90-day consultation is underway which could see the plant close in early 2009. Lighthouse Caledonia, which also has a processing facility in Argyll, was formed last year but posted losses of £2 million for the first half of this year.

Mr Allan added: "I am obviously seriously concerned at this news, which involved one of the biggest private employers in the islands.

"I have phoned Enterprise Minister, Jim Mather, urging the Scottish Government to intervene to ensure that a future can be found for the company within the islands. I have also spoken to the managing director of Lighthouse Caledonia to emphasise the vital importance of his company to the islands and to offer to work together with the company and other agencies to ensure jobs stay here. I will also be asking to meet with the workforce, who I appreciate are in a very concerning position."

Uist councillor Archie Campbell, chairman of Comhairle nan Eilean Siar’s sustainable development committee, said the announcement was "devastating news" which came as a complete surprise.

He added: "There have been no formal discussions with CNES. Why are they not prepared to invest in new equipment if the existing factory isn’t suitable? We are concerned that the Islands will become a salmon farming station and that all the value-added processing will be done elsewhere. These 130 people have effectively been given notice and this is a huge blow to our economy. We are contacting the company to see how we can help."

Lighthouse Caledonia currently employs 346 people in Scotland, including 35 in farming in the Western Isles and 130 people are employed at the processing plant at Marybank in Stornoway.

Uig councillor Norman A Macdonald said: "It is very difficult to believe anything the company say because they have gone back on so many assurances they gave at the time of the takeover.

"Most of the jobs in the Loch Roag area have now either gone or are under threat. People who have been working on salmon farms in Loch Roag for 25 years, since they left school, are now feeling very insecure.

"This is a major jobs loss for any area like this as well as what is happening in Stornoway."

Councillor Macdonald pointed out that if Lighthouse Caledonia went ahead with their plans there would be three mothballed processing plants in the islands — two at Marybank and one on Scalpay. "How realistic is it to talk about building another one?", he asked.

Councillor Macdonald also criticised the company for not consulting any public bodies before going ahead with their cutbacks.