Hull Council is in talks with Reel Cinema, which last month opened a new seven-screen venue in the centre, about it providing a new home for the struggling venue.

In May, the authority controversially reduced opening hours at the cinema in an adapted lecture theatre at the University of Lincoln in George Street to three nights and last month stopped selling advance tickets at its former home in Central Library. According to the council last year it cost £150,000 to run – and sold just 10,000 tickets.

Susan Harr, co-founder of the Friends of Hull Screen, said: "We were supposed to be involved at every stage but we have never yet been involved in any discussion.

"I think Hull Council should remember that members of Friends of Hull Screen put bums on seats – we are the clients, the customer base –,and they should listen to us.

"If we were in the discussions and some of our concerns were allayed we would feel more positive about it."

Ms Harr organised a social event last week attended by Reel Cinema's managing director Kailash Suri and was impressed by his vision for the cinema.

But she is concerned about what will happen to Hull Screen staff and the future if the venture is not commercially successful.

She said: "We feel uncomfortable about supporting a move that would make the present staff redundant, much as we liked the idea of a central location and we warmed to Mr Suri because of his obvious passion for film.

"There is also the worry in case he is not successful and wants to pull out – where does that leave Hull Screen? Do we retain the rights to the entity and name?

"We would have preferred, in an ideal world, to have a dedicated building that could be used for managed workspace, exhibition spaces, two or three screens and a cafe and bar, which could be a little more like Sheffield Showroom, a model for arts cinemas."

Coun Kalvin Neal said the council was in the middle of negotiations with staff, who were being offered transfer as well as relocation or voluntary redundancy. He added: "Obviously these are sensitive issues – these are people's livelihoods.

"Once the staff are on board we will be talking seriously with people such as Friends of Hull Screen.

"I have met Mr Suri on three occasions and I am more than happy with Hull Screen going there."

Coun Neal said the cinema would continue to be subsidised to a degree and on a sliding scale according to ticket sales.

But the council envisaged it being more in the region of £75,000 to £80,000.

And he insisted the council would continue its commitment to the cinema even if the move proved unsuccessful.

Mr Suri said: "I will do whatever possible to make it a comfortable home for Hull Screen without losing its identity
and work hard to meet their needs and give them a better choice."

He said Reel Cinemas was trying to offer a different product to that of competitors, which included the newly-opened Vue Cinema at Princes Quay.

At the moment it was the only cinema in the city that was showing Richard Attenborough's Closing the Ring and would host the sixth Hull International Short Film Festival.

He said: "Our screens are very intimate and we have the latest facilities.

"It is very accessible – near the bus and train station – and it is a very safe environment with no pubs and clubs round.

"We will be opening seven days a week and not three days a week."