More Production Woes for THE HOBBIT as Fire Destroys a Peter Jackson Studio

It seems Murphy's Law is working exponentially on and off the set of The Hobbit. Yesterday a fire engulfed Peter Jackson's New Zealand workshop which has previously been used for the Lord of the Rings trilogy and King Kong.

The fire occurred at Portsmouth Miniatures Studio which had been used in the past as a specialist miniatures shooting facility. It reportedly took fifty firefighters over three hours to extinguish the blaze. Add this to the woes caused by MGM's financial troubles, Guillermo del Toro leaving the project, and problems with the New Zealand unions which could force production to move to Europe.

The cause of the fire was under investigation on Saturday after crews battled flames for three hours the day before at the studio, which would have been used to shoot parts of the film. This setback comes right on the heels of news from an L.A. Times report yesterday that all signs are pointing toward a January shoot:

The studios have nearly finalized a deal with director, producer and co-writer Peter Jackson to make the two movies and have resolved most other key issues that have long held up the project, including those related to underlying rights from the estate of author J.R.R. Tolkien.

MGM is eager to make the films, people close to the situation said, and could give Warner Bros. the official okay in the next few days. However, it will still need to secure its half of the financing. Barber is expected to approach a number of potential investors, including studios including 20th Century Fox, which has an existing deal with MGM to release its movies overseas.

Other possibilities include outside financial investors or Warner Bros., which could loan MGM its share in exchange for additional distribution rights to the pictures.

The two prequels are planned to be shot back to back at an estimated $500 million dollars combined budget. Producers and studios are supposedly aiming for late 2012 and December 2013 3D theatrical release dates for the two-part film.