HUGE quantities of radioactive waste are to be entombed in a gigantic hole 2,600 feet beneath England's Lake District at an estimated cost of British pounds3.5 billion.The decision by UK Nirex, a nuclear waste management firm, has produced bitter complaints from environmentalists and from people living in and around Sellafield, the site of the planned nuclear dump. Sellafield, formerly known as Windscale, is also host to a large nuclear reprocessing plant. Michael Folger, Nirex's managing director-designate, compared the scale of the repository project to the half-completed Channel Tunnel that will link Britain and France after 1993. When completed, the nuclear dump will be the world's deepest and will be able to hold 70 million cubic feet of radioactive waste. The repository, to be expanded over a period of 50 years, will eventually have more than 20 caverns, each 800 feet long, 100 feet high, and 80 feet wide. When the repository comes into service 10 years from now, four or five trains a day will arrive at the site loaded with low- and medium-level nuclear material, much of it the by-product of nuclear reprocessing. The existing Sellafield reprocessing plant handles large quantities of nuclear waste brought in from abroad. Greenpeace, which opposes underground nuclear disposal, attacked the decision for being based on "political expediency rather than geological science." Some of the waste destined to end up in Sellafield's deep hole will take about 250,000 years to become safe. In the meantime it will be contained in steel drums encased in concrete cubes. The cubes will be lowered down vertical shafts, then placed in concrete-lined horizontal tubes, using robots. Sellafield was chosen to receive the repository after 500 other possible sites were considered. Surveys had cost British pounds50 million. A search for an underground dump site in Britain became necessary eight years ago when the London Dumping Convention decided to ban disposal of nuclear waste at sea. Before that Britain had dumped low-level waste at two sites in the Atlantic. Tom McInerny, Nirex's current chief, said the geology of the Sellafield site was particularly favorable. The area abounds in hard, stable volcanic rock, unlikely to be subject to movement or fragmentation. Greenpeace, other protest groups, and local residents are planning concerted opposition when, as is required by law, a public inquiry is held. It is thought, however, that Nirex has government backing for the choice of Sellafield. If for whatever reason the inquiry finds against Sellafield, Nirex intends to build a repository at an alternative site at Dounreay on the northern tip of Scotland, Mr. McInerny said. This would add a further British pounds1 billion to the cost of the project. Peter Roche, a Greenpeace campaigner, said the great depth of the Sellafield repository would make it virtually impossible to monitor the dumped waste. "A report 11 years ago by the British Geological Survey rejected Sellafield as geologically unsuitable," he said. Mr. Roche and other environmentalists fear that nuclear waste stored underground will generate poisonous gases. In Sweden, where a large underground dump already operates, similar concerns have been expressed by environmentalists. Nirex managers, however, say the Sellafield repository would not be used for very radioactive heat-emitting waste. It would contain low-level waste such as slightly contaminated clothing, pipes, and air filters, and medium-level material - spent nuclear fuel rods, faulty reactor parts, and sludge from reactor operations. Two-thirds of the stored waste would come from the nuclear reprocessing plant run by British Nuclear Fuels Ltd. (BNFL), McInerny said. The remaining third would come from the Atomic Weapons Establishment at Aldermaston and from nuclear submarine bases. Nirex, which is funded by BNFL, plans to spend the next few months continuing with test drilling at Sellafield and preparing an assessment of the environmental impact of the project. In the meantime, villagers in Gosforth, near the Sellafield reprocessing factory, will prepare their objections to the scheme. They are being led by Norman Murphy, a retired Army colonel. Mr. Murphy points out that Sellafield is on the edge of an area of great natural beauty, which acts as a magnet to hundreds of thousands of tourists every year.