By Diplomatic Correspondent Barnaby Mason

Kofi Annan was kept waiting for six or seven hours to see Colonel Gaddafi, but UN officials said the two men then met alone for about an hour and a half.

Clearly, a final deal has not been done and whether it will be in the near future is hard to judge.

Mr Annan described his talks as "fruitful and positive" - they had made considerable progress he said.

Libya had restated its agreement to a trial in a third country - Britain and the United States are pushing for one in the Netherlands, under Scottish law - Mr Annan said it would require some time to resolve remaining problems, but not an inordinate amount of time.

He declined to say what the problems were although the Libyans did again raise their objections to the two suspects serving prison sentences, if convicted, in Scotland.

The Libyan foreign minister, Omar Montasseh, said there were certain legal procedures which had to be completed before any handover of the two suspects. That's a reference to the involvement of the People's Congress. It will consider the Lockerbie issue at a week-long annual session beginning on Tuesday.

The question is, will Colonel Gaddafi give the signal that he wants a trial to go ahead.

Profile: Muammar Gaddafi, Libyan maverick
Profile: Kofi Annan, Master of diplomacy