The SA Government has reportedly settled a major dispute with its new hospital.

South Australian Treasurer Rob Lucas says a new deal has been struck to end to what he described as an “absolute lawyers' picnic”.

The state has reached an in-principle commercial settlement with the operators of the new Royal Adelaide Hospital over a range of problems, including dodgy duress alarms and construction faults.

The deal is expected to cost the Government about $16 million, which comes on top of the $18 million already spent on legal fees.

The new Royal Adelaide Hospital opened in 2017 after being built at a cost of $2.4 billion. Delays and cost blowouts left the final bill about $600 million over the originally budgeted figure.

Issues emerged soon after the launch with the duress alarm system and the air conditioning system.

The settlement will see the hospital's operators Celsus build two new cooling towers alongside other work.

Mr Lucas says the treasury, SA Health, the crown solicitor and a team of private legal advisers all accepted the deal as being in the state's best interest.