Hobbit film shoot begins in N.Z.

Cameras started rolling Monday in New Zealand on director Peter Jackson's production of The Hobbit, following months of delays.
British actor Martin Freeman, left, plays Bilbo Baggins and Richard Armitage is Thorin Oakenshield in The Hobbit, which began shooting Monday. (Anthony Phelps/Reuters)

Cameras started rolling Monday near Wellington, New Zealand, on director Peter Jackson's production of The Hobbit, following months of delays.

Hollywood studio funding problems, a threatened actors' boycott and ulcer surgery  for Jackson have plagued pre-production on the $500 million US project, which will split J.R.R. Tolkien's The Hobbit into two movies.

The director posted a studio news release on his website Monday saying production has commenced in New Zealand on the much-anticipated project.

British actor Martin Freeman  will star as hobbit Bilbo Baggins, alongside Elijah Wood, Ian McKellen, Cate Blanchett and Orlando Bloom, in the fantasy about a short, hairy-footed hero who finds a mysterious ring.

The films are expected to take up to two years to make, with the first timed for release in late 2012.

The Hobbit tells the back story to the Lord of the Rings trilogy, which was a blockbuster for Jackson. The third film won best-picture and best-director Oscars.

Jackson underwent surgery last month for a perforated stomach ulcer, pushing back the start of filming at least by several days.

Last October, New Zealand changed labour laws  and tipped in extra tax breaks for Hollywood studios MGM and New Line Cinema to ensure the Hobbit films would be made in the country.

The changes mean actors and others working on the films will be hired as contractors not employees. The union had wanted local actors and other production workers to be hired as full-fledged employees on union contracts.

New Zealand received a huge boost to its tourism and film-making industries from the Lord of the Rings trilogy.

Freeman, whose films include The Hitchhiker's Guide to the Galaxy and Hot Fuzz but who may be best known from Ricky Gervais' The Office television comedy, has said playing Baggins is the role of a lifetime.