In the studio with Elbow and I Am Kloot

After Elbow won the Mercury Music Prize in 2008 they were supposed to get straight to work on a follow-up to capitalise on their success.

Instead, they put that to one side to produce fellow Manchester band I Am Kloot. The resulting album has been nominated for this year's Mercury - and Elbow singer Guy Garvey and I Am Kloot frontman John Bramwell explain how it came together.

Reaching the top floor of the 170-year-old former mission building that Elbow call home, the stereotype of the small, sterile recording studio is immediately shattered.

To walk across the cavernous room, you must carefully pick your way between dozens of speakers, microphones, stands, drums and guitars that are strewn about, as well as cables snaking around the room, and buckets and towels catching leaks from the roof.

"In this room we have five or six drum kits, nine or 10 guitar amps, three pianos, two electric pianos, a Hammond organ, any number of percussion instruments," Garvey explains.

I Am Kloot have received the Mercury nomination for their fifth studio album Sky At Night

"There's a really odd little thing called a Sounder. It was £50 from the window of Cafe Pop [in Manchester]. It's an electronic keyboard that makes a weird repeating noise. Things you can blow. An accordion. And lots and lots of microphones."

The loft, which is Elbow's headquarters at Blueprint Studios, Salford, has the air of a teenager's bedroom that got out of hand.

"And this is a bar," Bramwell chips in.

"Oh and there's a bar in the room, yeah," Garvey continues. "It was very handy after Christmas - there was a huge party here and they left a lot of stock in the bar."

Next door is a smaller room where Garvey's bandmate and co-producer Craig Potter is hunched over a computer. On the wall is a whiteboard where Elbow will, eventually, write the names of all the tracks on their new album.

For now, about half of the spaces remain empty. ("We're a bit behind schedule now as it goes," Garvey admits.)

Garvey and Bramwell, who met 18 years ago when Garvey got on stage to play harmonica with Bramwell, make a fine double act.

They did not become firm friends until a decade ago, when Bramwell was booking bands for Manchester's Night & Day venue and three members of Elbow worked at the nearby Roadhouse.

"When we'd finished work we'd come over to Night & Day and pretty much end up round the same bar every night," Garvey says.

The friendship led Garvey to produce I Am Kloot's debut album, the excellent, overlooked Natural History, which was released in 2001, just as Elbow were taking off.

But aside from short bursts of touring, the two bands never managed to synchronise their schedules in order to work together again - until I Am Kloot's new album, Sky At Night.

"With the strength of songs on this record, it was impossible for us not to be involved," Garvey says. "We made the time."

Kloot have gathered a cult following since Natural History, but Bramwell speaks of being "very very broke for years" and recording their last album in three days "because we had so little money".

Sky At Night, though, is their first top 40 album and has brought more acclaim and sales than any previous release.

The pair describe an intuitive studio relationship and a democratic process where all of the band's ideas would be written on a whiteboard (Garvey admits he is a "stationery fetishist") and tried out.

Garvey played good cop - "bouncing off the walls, keeping everybody buzzed up", as he describes it - to Potter's perfectionist taskmaster.

"I've definitely learned over the years from different producers," Garvey explains. "It's important that you enjoy as much of your life as possible, that's a personal rule of mine. The best production experiences I've had have been the most fun.

"The worst experiences have been when whoever's at the helm is pretending they're a magic man and they're going to sort your life out. Smoke and mirrors, not showing you how you're doing something. It's nonsense.

"What you need to know is that who's in charge of the recording loves your songs and keep reminding you why your songs are good. Hopefully that's what I did with Kloot."

Bramwell concurs and describes Garvey as "inspirational".

"It's a question of keeping momentum and keeping freshness," he says. "And Craig is incredibly meticulous and able to keep concentrating on something.

"Sometimes you could spend a whole day and not see Craig's face because he's sat looking at the machinery and might not even turn around for a good three or four hours."

Garvey picks up the theme: "He's sparing with his words, Craig. For instance he used fruit instead of words on a few occasions.

"I'd be three floors downstairs having a smoke with the lads, and if this went on for too long and he was bored of waiting, he'd find an orange. I don't know where these oranges were coming from, but I'd get an orange on the top of the head, which meant 'back to work'."

There were drawbacks to recording in such a large space amid organised chaos.

"If Pete was recording a bass track and a certain note made something rattle, finding that rattle could take half an hour because there are so many things that could rattle," Garvey recalls.

"So Craig and I would run in with strips of tape while Pete played this note continuously for half an hour.

"Some of my favourite moments are John, Pete and Craig all sat at pianos, all playing the same riff at the same time, with the microphone at the other side of the room, at Craig's behest.

"But it's a sound that you couldn't have got if you'd tried to do it digitally."

In this case, organised chaos has proved to be the most productive kind.

The Mercury Prize winner is announced on Tuesday. Watch live coverage of the ceremony on BBC Two at 2200 BST.