* Olkiluoto 3 reactor a decade late of original schedule
* Suppliers and owner settle long-running dispute
* Unit due to provide 10 pct of Finland's power needs (Adds payment details, minister quote)
By Tuomas Forsell and Jussi Rosendahl
HELSINKI/PARIS, March 11 (Reuters) - France's Areva SA settled a long-running dispute with Finland's Teollisuuden Voima (TVO) by agreeing to pay 450 million euros ($554 million) for cost overruns and delays at a nuclear reactor it is building with Germany's Siemens.
Originally planned to begin production in 2009, the Olkiluoto 3 plant in southwest Finland is still not completed. The plant suppliers and TVO had been claiming billions of euros from each other at an arbitration court.
Following the deal, the companies said they would withdraw all ongoing legal actions.
"TVO welcomes the agreement which ensures that the OL3 EPR (European Pressurised Reactor) project continues to have the necessary financial, technical and human resources for the completion and successful start-up of the plant," TVO President Jarmo Tanhua said in a statement.
Reactor supplier Areva will pay the whole compensation for TVO as Siemens only delivered the unit's turbine plant.
TVO said it will pay back up to 150 million euros if the plant is completed on time, by May 2019.
In case the plant is not ready by the end of 2019, there will be an additional penalty of up to 400 million euros.
"All parties wanted to find an alternative settlement to the arbitration. This settlement will allow us all to refocus all our resources and energy towards completion of this new EPR," said Areva SA CEO Philippe Soulie.
He said the company would secure all resources necessary to complete the plant on time.
A turnkey contract for Olkiluoto 3, signed in 2003, fixed the cost of the reactor at 3.2 billion euros. TVO said on Sunday that its overall investment will be around 5.5 billion euros.
Areva-Siemens had been claiming 3.6 billion euros from TVO while the Finnish company had filed a counter-claim of 2.6 billion euros.
By the time of the agreement, TVO had won three partial rulings against Areva-Siemens from the Internationl Chamber of Commerce's arbitration court.
"It (450 million euros) is a significant amount, although not exactly what TVO was looking for. But in this situation this is a relatively good deal," Finland's Minister of Economy Mika Lintila told public broadcaster YLE.
Olkiluoto 3 is set to become Finland's fifth and largest nuclear unit and provide about 10 percent of the country's power needs.
TVO's owners include Finnish paper companies UPM and Stora Enso as well as utility Fortum. ($1 = 0.8122 euros) (Reporting by Tuomas Forsell and Jussi Rosendahl in Helsinki, Michel Rose in Paris Editing by Peter Graff)