F1 CEO Chase Carey is "pleased" that a conclusion has been reached between teams and engine suppliers and stated the importance of Honda remaining in the sport.
Honda have set their sights on the top three next season with Toro Rosso after entering into a 'multi-year agreement' with Red Bull's junior team, while McLaren will be powered by a works Renault engine from 2018 onward.
Friday's announcements brings an end to months of rumour and speculation and Carey is happy that the F1 chiefs were able to have a helping hand in negotiations to ensure all parties came away with what they needed.
"We are pleased that the teams and constructors involved in these intensive and complex discussions have reached an agreement satisfactory to all concerned," said Carey.
"We had put ourselves at the disposal of the various parties to try and facilitate the best possible outcome for everyone.
"It is particularly important that Honda, one of the main manufacturers in the motor industry and a company that has played an important role in the history of motorsport, will still be in Formula 1 for years to come.
"We’re all looking forward to working together with all the teams and manufacturers to make our sport more exciting and spectacular for the fans all over the world."