SLUG: 2-306247 US-Lybia-Lockerbie (L-only)
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INTRO: U-S officials say there has been progress toward reaching a settlement in the long-running dispute over the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland. Libya is negotiating with families of the victims of the attack over a financial settlement and there are reports that a Libyan admission of responsibility may be near. VOA's David Gollust reports from the State Department.
TEXT: U-S officials are approaching the reports of a possible breakthrough on the Lockerbie bombing with caution, noting that hopes for a settlement have been repeatedly dashed in the recent past.
But the State Department says there has been progress in the compensation talks between the Libyan government and the families of the 270 victims. And one senior official here said there is at least an even chance that the case may soon be settled with an accompanying Libyan admission of responsibility.
Representatives of the families of those killed are quoted as saying they expect a final agreement to be signed August 14th settling up an escrow account funded by Libya of two-point-seven billion dollars, or ten million dollars per family.
Under the pending deal, Libya would make its first payment into the fund within 30 days and formally notify the U-N Security Council of its responsibility for the bombing a key condition for the permanent lifting of U-N sanctions against the Tripoli government.
At a news briefing, State Department spokesman Philip Reeker welcomed the signs of progress on the compensation issue, but also said there can be no short-cut for Libya in meeting the terms established for ending its international isolation:
Libya needs to meet the United Nations' requirements, which include an acceptance of responsibility and payment of appropriate compensation. So Libya knows what it needs to do, and I'll repeat what we said before: there are no short-cuts or lowering of the bar for what they need to do in that case.
The United Nations imposed economic and aviation sanctions against Libya in 1992 because of the airliner attacks, but suspended them in 1999 after Libya handed over two of its intelligence agents accused in the bombing.
Two years later, a Scottish court sitting in the Netherlands convicted one of the Libyans and sentenced him to life in prison, while acquitting the other.
Parallel U-S sanctions against Libya remain in force, including those stemming from that country's listing by the United States as a state sponsor of terrorism.
Administration officials say a compensation deal could open the way for a dialogue with Libya on the lifting of the U-S sanctions but that the United States would not be bound by its terms.
Libyan leader Muammar Gadhafi told U-S television interviewers Sunday he believes the Lockerbie case is "about to be closed." (Signed)
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