Ambassadors of the five veto-wielding permanent members of the Security Council -- Britain, China, France, Russia and the United States -- plus Germany held closed-door consultations Tuesday and agreed to meet Wednesday.

"We made a lot progress. This was the most productive session ... This brings us very close," US Ambassador to the United Nations John Bolton told reporters after the afternoon session.

He said the six ambassadors would report back to their capitals for instructions prior to Wednesday's meeting.

"It was a very good working discussion. We managed to get more agreement," Britain's deputy UN ambassador Karen Pierce concurred. "This is all going to be discussed in our capitals and among ourselves over the next couple of days. We are moving forward."

She said ministers, including US Secretary of State Condoleezza Rice and her Russian counterpart Sergei Lavrov, would touch on the issue Wednesday on the sidelines of crisis talks in Rome on the escalating bloodshed in Lebanon.

France's UN Ambassador Jean-Marc de La Sabliere, who presides over the council this month, voiced hope that the six envoys would be able to present a text to the 10 non-permanent members of the council Wednesday afternoon.

He stressed that the main elements of the draft under discussion exactly reflected a communique adopted by their ministers at a Paris meeting on July 12.

"So, the discussion we still have is how to translate into a resolution the agreement among the ministers," de La Sabliere said. "One fundamental element of that agreement is to make the suspension of all enrichment-related activities mandatory, including research and development."

Speaking after the morning session, Russian Ambassador Vitaly Churkin said: "We had a good discussion ... We are moving rather smoothly toward our goal of having a draft resolution ... We are not far away."

Ministers from the six powers tackling the Iranian nuclear issue decided earlier this month to send the Iran nuclear dossier back to the Security Council after Tehran failed to respond to a package of Western security and economic incentives in exchange for a suspension of its enrichment activities.

Iran reiterated Monday it will not halt uranium enrichment.

"We are ready to discuss anything in negotiations ... (but) we will not accept any preconditions," Iranian government spokesman Gholam Hossein Elham told reporters.

And top Iranian nuclear negotiator Ali Larijani has said Iran will respond to the nuclear offer by August 22.

The draft resolution discussed by the six envoys here would require Iran to suspend all uranium enrichment and reprocessing.

The text invokes articles 39 and 40 of Chapter Seven of the UN charter that stipulate "provisional measures" to be taken ahead of imposing tougher steps such as sanctions.

But it also expresses the council's intention in the event of Iran's non-compliance with the enrichment freeze demand "to adopt such further measures under Article 41 of Chapter Seven as may be necessary to ensure compliance."

Article 41 provides for a broad range of economic sanctions but does not authorize the use of force.

It gives Iran until an unspecified date in August to comply with the UN demands.

Iran denies Western charges that it is seeking to acquire a covert nuclear weapons capability and insists it wants to enrich uranium solely to make reactor fuel. It argues that this is a right under the nuclear Non-Proliferation Treaty which it signed.

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