Guillermo del Toro has announced that after almost two years developing an adaptation of JRR Tolkien's 'The Hobbit' he is leaving the project as director.

The Hollywood Reporter says the 'Pan's Labyrinth' director made the announcement on the 'Lord of the Rings' fansite The One Ring.

He said: "In light of ongoing delays in the setting of a start date for filming 'The Hobbit', I am faced with the hardest decision of my life.

"After nearly two years of living, breathing and designing a world as rich as Tolkien's Middle Earth, I must, with great regret, take leave from helming these wonderful pictures."

Del Toro said he would continue to co-write the screenplays for 'The Hobbit', planned as two films, with 'Lord of the Rings' director Peter Jackson, Fran Walsh and Phillippa Boyens.

Del Toro continued: "The blessings have been plenty, but the mounting pressures of conflicting schedules have overwhelmed the time slot originally allocated for the project.

"Both as a co-writer and as a director, I wish the production nothing but the very best of luck and I will be first in line to see the finished product. I remain an ally to it and its makers, present and future, and fully support a smooth transition to a new director."

Jackson said: "We understand how the protracted development time on these two films - due to reasons beyond anyone's control - has compromised his commitment to other long term projects.

"The bottom line is that Guillermo just didn't feel he could commit six years to living in New Zealand, exclusively making these films, when his original commitment was for three years."

Jackson and the film studios New Line and Warner Bros will discuss a new director for 'The Hobbit' this week.