Bernie Ecclestone said recently that formula one could "do without" its famous annual round on the streets of the Principality.

Former driver Patrick Tambay surmised it was a ploy to drive the organizers’ fees "upwards", and the Automobile Club de Monaco confirmed it is in "negotiations" with the F1 chief executive.

With a brief statement on Wednesday, Ecclestone's Formula One Administration announced that a new contract has been agreed after a meeting in London with Michel Boeri, the Monaco club's president.

"The next Monaco grand prix will take place on May 29, 2011," the statement added.