European Union foreign policy chief Javier Solana presented a package of incentives and multilateral talks in Tehran, hoping to persuade the Iranian leadership to suspend uranium enrichment.

Some western capitals had feared the proposals would be dismissed even before they were tabled.

But Iran's top national security official, Ali Larijani, said: "There are positive steps in the proposal, and there are also some ambiguities that should be cleared up."

Larijani called for more talks, while Solana said he had "good discussions" with the Iranian negotiator over the package drawn up by Britain, France and Germany and backed by the United States, Russia and China.

"Now that the proposal is on the table, I hope we will receive a positive response which will be satisfactory to both sides," he said after also meeting Foreign Minister Manouchehr Mottaki before flying out of Tehran.

Solana spoke to US Secretary of State Condoleezza Rice after returning to Brussels, a US State Department spokesman said.

Solana told Rice "that he found the discussions very useful and constructive," said spokesman Sean McCormack.

"The Iranians told him that they would consider the proposal but would need some time to review it. Mr. Solana said that he would be in contact with the Iranians in the coming days about the proposal," the spokesman told reporters in Washington.

Larijani did not elaborate on what the "ambiguities" were, but Iran will undoubtedly have questions over the scope and duration of a nuclear suspension.

US President George W. Bush cautiously welcomed Iran's "positive" initial reaction to the international proposal.

"We will see if the Iranians take our offer seriously. The choice is theirs to make," the president said in Texas. "I want to solve this issue with Iran diplomatically."

"I have said the United States will come and sit down at the table with them, so long as they are willing to suspend their enrichment in a verifiable way," he said. "So it sounds like a positive response to me."

While being offered carrots, Iran also faces the stick of robust Security Council action, including a range of possible sanctions, if it rejects the offer and continues what the West fears is a covert weapons drive.

Although the United States has not ruled out military action, diplomats say it has helped sweeten the package by offering to lift certain sanctions if Iran agrees to an enrichment freeze.

Washington, whose ties with Tehran were severed more than two decades ago, has banned most US trade and investment in the Islamic republic since the mid-1990s.

White House spokesman Tony Snow said if Iran suspended nuclear fuel work, then the six powers would be able to reveal more details about what was on offer.

German Chancellor Angela Merkel called on Iran to respond with a "positive signal", saying the conditional US offer to take part in multilateral talks with Tehran was "a very important additional step".

"This is not about denying Iran's eventual right to a peaceful nuclear programme but about transparency and about respect for the IAEA (the International Atomic Energy Agency)," she said.

On Saturday, hardline Iranian President Mahmoud Ahmadinejad revealed that he had been asked by UN Secretary General Kofi Annan "to examine the proposals and not act hastily".

But the president has consistently ruled out halting enrichment: "They say that they want to give us incentives. They think that they can take away our gold and give us some nuts and chocolate in exchange," he said last month.

Attention will return to Iran's uranium research with the report to be delivered Thursday.

The report will contain "the latest observations from inspectors who have just reported their latest information from (the Iranian enrichment facility in) Natanz", IAEA spokeswoman Melissa Fleming said.

The three page report comes ahead of a meeting next week of the IAEA's 35-nation board of governors.

Iran denies it is seeking nuclear weapons.

Related Links
-