Newfoundland and Labrador Premier Kathy Dunderdale says trade talks are back on with the federal government after she revealed tensions during negotiations for trade talks with the European Union.

Dunderdale said last week that the province was being pressured by Ottawa to drop the province's minimum processing requirements for fish in order to help secure the Canada-EU Trade Agreement.

She said talks went off the rails when the federal government tried to tie the loan guarantee for the Muskrat Falls hydroelectric mega-project to the deal.

However, Tuesday morning she said the federal and provincial governments have come to an understanding about the province's platform.

"We seem to be back on track — we have alignment," Dunderdale said. "This is a very big deal for Canada. It has significant impact, not just for Newfoundland and Labrador, but for the whole country."

But Dunderdale said she was concerned about the interests of the province first.

"We weren't going to compromise that in any way, regardless of what the benefits might be for the rest of the country," she said.

"If you're asking us to look at something [to compromise] here, then we need to know what you're providing over here to counter that. So all of that is in the mix, and we'll see what comes out at the end of it all."

Dunderdale said she is confident that the federal government has a clear understanding of the province's platform.

"I'm always going to be vigilant, but we have been able to say quite clearly what our concerns are, what are positions are, where we're prepared to have some flexibility — but what we want in return for that, all of that has been acknowledged by the federal government," Dunderdale said.

"I know that the federal negotiator has been briefed to that effect, and we'll see where we're going then."

She said a final deal with the EU is still likely a couple of weeks away.