GENEVA - Six world powers held talks with Iran on Thursday that U.S. officials said would need to convince them Tehran was prepared to show it was not hiding plans for a nuclear bomb.

Underlining they would not threaten fresh sanctions against Tehran but had prepared them in case the talks made no progress, Washington also said there could be an opportunity for a rare bilateral meeting with the Iranians.

This can't be a phony process, a senior U.S. official said in Washington. It can't be a process where they go through the motions.

U.S. diplomats sat alongside those from Britain, France, Germany, Russia and China for the talks near Geneva on how to end the long-running standoff over Iran's nuclear program, which Tehran says is designed purely for generating electricity.

Tehran had said the program was not up for discussion and the talks should focus on regional issues like Afghanistan, but a Western diplomat close to the meeting said Iran's nuclear negotiator had touched on it in his opening statement.

The diplomat said it was not yet clear if the Iranians would give any signs behind closed doors that they would be open to a compromise on the issue of suspending uranium enrichment, as demanded by five U.N. Security Council resolutions.

Western diplomats said they also want Iran to allow immediate U.N. inspections of a second uranium enrichment facility at Qom, which Tehran revealed only last week, and provide access to documents and people working there.

'THE ENGAGEMENT TRACK'

In Washington, senior Obama administration officials said the United States would not threaten Iran with fresh sanctions at the one-day talks. This is the engagement track ... not the pressure track, one senior official said.

But the official said the United States has been preparing a range of areas in which to pursue sanctions against Iran if Tehran ignores Western entreaties about its nuclear program.

The officials would not elaborate on the sanctions, which experts believe may be targeted at the energy sector. They said consultations had been active and sanctions could be applied through the U.N. Security Council or by individual states.

You're in a much better position to prepare the ground on the pressure track if you have demonstrated unmistakably that you're doing everything you can on the engagement side, one official said.

The meeting at the elegant villa made available by the Swiss for decades to bring foes together was the first time a U.S. official was a full participant in such talks.

U.S. officials said Undersecretary of State for Political Affairs William Burns, head of the U.S. delegation, was not actively seeking one-on-one talks with Iran's chief nuclear negotiator Saeed Jalili but would not reject one if the opportunity arose.

A Burns-Jalili meeting would be the highest level U.S.-Iran talks in nearly 30 years. Washington severed relations with Tehran in 1980 during a hostage crisis in the wake of Iran's Islamic Revolution.

The administration of former President George W. Bush reluctantly began to take part in multilateral talks with Iran
toward the end of his presidency. President Barack Obama, Bush's successor, has said he wants to improve U.S.-Iranian ties but Tehran has reacted coolly to his overtures.

WEST EYES RUSSIAN, CHINESE REACTION

Professor Mohammad Marandi, head of North American studies at Tehran university, said the Iranians expected the six powers to accept it had a right to a nuclear program.

Iranian President Mahmoud Ahmadinejad said in New York last week his delegation would ask at the Geneva meeting that Iran be allowed to buy enriched uranium for medical purposes from the United States or any other country prepared to sell it.

A U.S. official said Washington would make clear that it was not prepared to sell Iran any uranium.

The Western powers also want to gauge Russian and Chinese reaction to last week's announcement that Tehran had been concealing the uranium enrichment plant at Qom. Western diplomats said Moscow and Beijing seemed to share their concern.

The Russians and Chinese don't want a nuclear-armed Iran, a Western diplomat told Reuters. They've made that clear.

NATO Secretary-General Anders Fogh Rasmussen said in London he hoped Iran realized it had to abandon its nuclear plans.

Recent events including the fact that Iran had not declared the existence of a nuclear site testifies to the importance of this issue and stresses the need for an increased international, political and diplomatic pressure on Iran, he told reporters.

The senior U.S. official said Thursday's talks could not be an open-ended process or talks just for the sake of talks, but that the issue was likely to need more than one meeting.

Obama has said he wants progress before the end of the year. The six powers also want a clear response from Iran to their offer of economic and political incentives in exchange for a suspension of enrichment activities.

(Additional reporting by Stephanie Nebehay in Geneva, Steve Holland in Washington, Fredrik Dahl in Tehran and Jonathan Saul in London; editing by Philippa Fletcher)

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