French nuclear power giant Areva said Sunday it has settled a long-running dispute with Finnish utility TVO over a troubled next-generation reactor, agreeing to pay 450 million euros ($554 million) in compensation.

Since 2005, Areva, together with German engineering giant Siemens, has been building the Olkiluoto 3 reactor in western Finland, touted as the world's first European Pressurised Reactor (EPR).

But delays and cost overruns have dogged the project which will not go online until May 2019, a decade later than the original starting date.

In their long and bitter dispute, which the two sides finally took to arbitration by the International Chamber of Commerce in Paris, Areva was claiming damages of 3.4 billion euros and TVO was claiming 2.6 billion euros.

The supplier consortium companies, Areva and Siemens, have signed "a comprehensive settlement agreement" with TVO, Areva said in a statement.

The settlement agreement "concerns the completion of the OL3 EPR project and related disputes."

The entry into force of the deal was "subject to certain conditions that are currently expected to be met during March 2018."

Under the deal, the supplier consortium companies are to pay financial compensation of 450 million euros to TVO.

TVO chief executive Jarmo Tanhua said the Finnish group "welcomes the agreement which ensures that the OL3 EPR project continues to have the necessary financial, technical and human resources for the completion and successful start-up of the plant and also settles other outstanding issues.

"We very much look forward to working closely with our partners to fully implement this agreement and to promptly accomplish the several crucial project steps leading to the start of regular electricity production of the unit," he said.

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AREVA

SIEMENS

ORANO

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