UPDATE 1-Areva's Finland nuclear reactor delayed again, TVO says

(Adds Areva comment, detail, background)

HELSINKI, Oct 9 (Reuters) - The start of regular power production at Finland's biggest nuclear reactor Olkiluoto 3 will be delayed further until May 2019, almost a decade later than originally planned, owner Teollisuuden Voima (TVO) said on Monday.

The project in western Finland, built by a consortium led by French state-owned nuclear group Areva, has been hit by repeated delays, soaring costs and court disputes. Most recently, it had targeted the start of regular power production for the end of 2018.

TVO said many important tests at the plant were yet to be carried out and that Areva needed to allocate the necessary resources to the project.

"We are very disappointed by this additional delay. There is still substantial work to be accomplished in the project," TVO project director Jouni Silvennoinen said in a statement.

An Areva spokesman said the reactor would produce its first power at the end of 2018, but that it would take four months to ramp up to full production capacity, which would delay the commercial startup by four months to May 2019.

He said hot-testing would start in December 2017, nuclear fuel would be loaded in August 2018, first grid connection would be in December 2018 and the commercial start would be May 2019.

Last month, TVO filed an appeal to the European Commission over France's restructuring of its nuclear industry, saying Areva, which is selling its nuclear reactor business to utility EDF, could be unable to meet its liabilities in Finland.

The parties are locked in a dispute at the International Chamber of Commerce, where TVO is claiming 2.6 billion euros from the Areva-led consortium, which has filed a counter-claim of 3.6 billion euros. Areva has a 73 percent stake in the consortium and Germany's Siemens 27 percent.

The cost of Olkiluoto 3 was initially estimated at 3.2 billion euros but Areva in 2012 estimated the overall cost at closer to 8.5 billion euros. Since then it has not updated its cost projection.

EDF on Monday confirmed a 10.5 billion euro cost estimate for a similar European Pressurised Reactor (EPR) it is building in Flamanville, France, which has suffered similar delays and cost overruns.

TVO's owners include Finnish paper companies UPM and Stora Enso as well as utility Fortum.

($1 = 0.8344 euros) (Reporting by Jussi Rosendahl and Tuomas Forsell in Helsinki and Geert De Clercq in Paris; Editing by Jason Neely and Mark Potter)