Soon after Libyan sources announced that Tripoli and families of the 170 victims have agreed on a compensation deal, French Foreign Minister Dominique de Villepin said France would drop its objections against lifting of the sanctions against Libya.

"France naturally has no more opposition to the UN Security Council voting for the lifting of sanctions against Libya as quickly as possible in New York," Villepin said.

France had repeatedly threatened to delay the lifting of the sanctions imposed on Libya for the 1988 bombing of a Pan Aam airliner over Lockerbie in Scotland, unless Libya compensated families of the UTA victims adequately.

But the French gave up its opposition finally as both Libyan sources and lawyers of the families of the UTA victims said an agreement has finally been reached.

Signed

A senior Libyan official said the deal has been signed. "It was inked by Rajab Zarouk, a top official from Qadhafi Foundation and a representative of the French families. Every side is happy with the agreement," he said.

"France naturally has no more opposition to the UN Security Council voting for the lifting of sanctions against Libya as quickly as possible in New York"

Dominique de Villepin
French Foreign Minister

"Its been a long fight, and today we can see a solution that allows a large number of the victims to bring it to an end and start the task of grieving," said a lawyer of the victims' families.

The agreement came on the eve of an expected vote in the UN Security Council on a resolution lifting sanctions against Libya in return for a $ 2.7 billion compensation deal for the families of the Lockerbie bombing.

United Kingdom had originally planned to call for a vote on Tuesday, but gave in to pressure from France, which threatened to veto the resolution unless Libya paid comparable compensation for the UTA bombing as well.

The UTA airliner went down over the west African state of Niger in September 1989.