September 17, 2005 - 12:35 AM

Six-party talks in deadlock, to continue Sunday

By Teruaki Ueno and Jack Kim

BEIJING (Reuters) - Six-party talks aimed at defusing a crisis over North Korea's nuclear ambitions will enter a sixth day on Sunday after failing to a break a deadlock over Pyongyang's insistence on its right to atomic energy.

Delegates from the two Koreas, the United States, Japan, Russia and host China decided to hold a plenary session at 0100 GMT (2:00 a.m. British time) on Sunday to make another attempt to break the impasse, a South Korean delegate said on Saturday.

The talks remained deadlocked despite a meeting of chief delegates and a flurry of bilaterals during the day. Japan's representative was pessimistic about the possibility of reaching any solution.

"No breakthrough has been achieved at this point," Kenichiro Sasae told reporters. "The prospects are not bright. We are not satisfied with the present situation."

On Saturday evening, China is expected to treat delegates from other countries to a banquet to mark the Mid-Autumn Festival. The festival is known best for moon cakes -- traditional round pastries with fillings like lotus seed paste and salted duck egg yolk to symbolise the moon.

It is celebrated in China on Sunday and runs from September 17-19 in North and South Korea with families gathering for reunions, paying respects to ancestors and feasting.

It was not known if any talks would be held during the banquet.

During the day, delegates were discussing a revised draft statement proposed by China on Friday, which Russian chief delegate Alexander Alexeyev described as balanced and said acknowledged Pyongyang's right to the long-term prospect of a light-water nuclear reactor that the North has been demanding.

But Russia's Interfax news agency quoted a North Korean source as saying China's draft was unacceptable and "practically repeats the position of the United States".

Failure to reach an agreement on dismantling North Korea's nuclear weapons programmes in exchange for aid and security guarantees could prompt Washington to take the issue to the U.N. Security Council to press for sanctions.

Pyongyang has said sanctions would be tantamount to war.

The United States and North Korea were deeply divided over the North's demands for a nuclear reactor to generate electricity. Pyongyang rejected an offer by Seoul to supply it with 2,000 megawatts of conventional energy.

"We think there has been a very good package on the table and we believe the DPRK needs to look very carefully," chief U.S. negotiator Christopher Hill said, referring to Pyongyang's official name, the Democratic People's Republic of Korea.

PLUTONIUM

The parties say they agree in principle to a nuclear-weapons-free Korean peninsula, but in four rounds of negotiations since 2003 they have been unable to agree to even a basic statement of principles.

North Korea appeared to offer some leeway on Friday, saying it would accept joint management and inspections of a light-water reactor.

"In order to dispel U.S. concerns in the provisions of a light-water reactor, we said we would leave its operation to joint management and will also accept inspections," a North Korean official said.

But the North also indicated it was going ahead with processing spent fuel rods into plutonium, Japan's Kyodo news agency said. U.S. intelligence estimates Pyongyang has already produced enough weapons-grade plutonium to make at least nine nuclear bombs, and Washington has signalled it is running out of patience with the talks.

In an interview with the New York Post released on Friday, U.S. Secretary of State Condoleezza Rice threatened to freeze North Korean assets if it did not toe the line at talks and said Washington wanted to see progress within five days.

The standoff began in October 2002, when the United States said North Korea had admitted to a secret programme to enrich uranium, in violation of a 1994 agreement.

North Korea denied the charge, threw out weapons inspectors and withdrew from the Non-Proliferation Treaty. In February this year it raised the stakes by saying it had nuclear weapons.