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The long-running dispute over the industrial contract to build Europe's next-generation weather satellites has finally been settled.

A consortium led by Thales Alenia Space of France will now build the spacecraft in a deal worth some 1.25bn euros.

The German government had objected to the decision, believing one of its national firms should have been given leadership of the project instead.

But Berlin indicated on Monday it would no longer hold up the deal.

The acceptance is tied to an agreement that the German part of EADS Astrium should receive a larger workshare in the project.

Meteosat Third Generation (MTG) will be one of the biggest and the most complex space projects ever undertaken in Europe.

It is a joint venture between the European Space Agency (Esa) and Eumetsat, the international agency charged with looking after Europe's Meteosats.

Both organisations' member states are funding the cost of MTG, and Germany will be the largest single contributor to the programme.

The system will comprise six satellites, with the first spacecraft likely to be ready for launch from 2016.

MTG is expected to bring a step change in capability, resulting in more accurate and more detailed weather forecasts.

But Germany refused to accept the outcome of the satellite tender process announced in March that gave the prime contractor role to TAS even though the French outfit's proposal was allied to a substantial workshare for the German space company OHB System.

The solution, announced at the Eumetsat Council Meeting held in Rome, was to give EADS Astrium a significant role on the instrumentation for MTG's sounding spacecraft.

The sounder will be one of the key innovations on the new project, allowing Meteosats for the first time not just to image weather systems but to analyse the atmosphere layer by layer and do far more detailed chemical composition studies.

The row has added about six months to the MTG project timeline, but a top Esa official told ���˿��� News that this was not a major issue because the current Meteosat Second Generation (MSG) spacecraft were performing so well. Indeed, the launch of the next spare MSG platform has been put back by a year to hold capability in reserve.

Neither would the row add significantly to the cost of MTG, said the official. Any increases would still leave the contract price well inside the overall envelope for the space segment of MTG of 1.3bn euros.

The breaking of the impasse has allowed all Eumetsat members to formally approve the project, and to begin the process of organising their finances.

While Esa is looking after the initial research and development of the satellites, Eumetsat will pay for ongoing commissioning and ground operations. This will be the lion's share of the total cost of MTG which could approach 3.5bn euros.

The programme should guarantee European access to space-acquired meteorological data until at least the late 2030s.

Jonathan.Amos-INTERNET@bbc.co.uk