Spanish director Alex de la Iglesia has launched his own production company, Panico Films, through which he plans to set up new feature film project Balas Perdidas (literally, Stray Bullets), according to statements he made in Argentina this week.

In an interview with La Nacion newspaper, de la Iglesia said that Bullets will be his next film and that he hopes to produce it himself. The plans would signify further delays on his much anticipated Fu Manchu project, a $20m English-language thriller in development at Spanish production giant Lolafilms since 1998.

The move appears to be motivated by the departure of star Antonio Banderas from Fu Manchu. De la Iglesia, habitual partner Jorge Guerricaechevarria and David Newman (Bonnie And Clyde, Superman) collaborated on the script for the film.

Bullets could become de la Iglesia's first feature made outside Lolafilms since 1995, the start of a fruitful relationship with producer Andres Vicente Gomez which has resulted in four hit films including Common Wealth (La Comunidad), Dying Of Laughter (Muertos De Risa), Perdita Durango and The Day Of The Beast (El Dia De La Bestia).

Or, de la Iglesia could potentially shape a future co-production arrangement with Lolafilms similar to that forged by peer Santiago Segura on his box-office smash sequel Torrente 2: Mission In Marbella (Torrente 2: Mision En Marbella).

The director describes Bullets as a "modern-day spaghetti western" which he plans to shoot before year-end in Almeria, a Spanish region made famous as the location for films of the genre. De la Iglesia, who is writing the script himself, told La Nacion he hopes to cast Carmen Maura, star of Common Wealth, in the new project.