Speaking after a meeting of the bloc's foreign ministers, Austrian Foreign Minister Ursula Plassnik, whose country currently holds the EU presidency, said that the European Union would also work towards political and economic cooperation with Iran.

"We are prepared to work on a cooperation package and support Iran's development of a proliferation-proof civilian nuclear program," she said, according to AP news service.

Plassnik added that EU officials were also considering economic assistance, political cooperation as ways to encourage Tehran to drop ambitions for a nuclear program that could be used to produce atomic weapons. The West fears that Iran is trying to develop a nuclear weapon behind the screen of a civilian atomic energy program. Tehran says it only wants to generate energy.

"The intention is not to push Iran into further isolation but to find a way to bring Iran back to a negotiating track," Plassnik said. "But we will also look at measures to be taken should Iran continue to reject this course."

Iranian Foreign Minister Manouchehr Mottaki, however, told the ambassadors of Britain, France and Germany Monday that any halt to uranium enrichment was "unacceptable," the official IRNA news agency reported.

"Any call for a suspension or pause (in uranium enrichment) is illogical and unacceptable and will without any doubt be rejected," the ministry quoted Mottaki as saying. "Tehran is ready to negotiate and would welcome any constructive proposal which both guarantees Iran's legitimate rights and helps settle the nuclear issue."

A "bold offer"?

The EU's foreign policy chief Javier Solana meanwhile said the bloc could offer the Islamic republic "the most sophisticated" technology to help its power needs.

"We want to prove to the Iranians that we have nothing against Iran to use nuclear power for peaceful means," he told reporters, adding that the bloc would present Tehran with a "bold offer."

"If they want to construct nuclear energy power plants they will have, in cooperation with the European union and other members of the international community, the best and most sophisticated technology," Solana said. "If they reject that it will mean that what they want is

something different."

The EU, whose package must also satisfy Russia and China, has until May 19 -- when negotiators from the Security Council's five permanent members plus Germany meet in London -- to complete its work.

Last chances?

Solana played down comments by Iranian President Mahmoud Ahmadinejad, rejecting any new EU offer that might demand that the Islamic republic halt uranium enrichment activities. He added that the Iranians had yet to see the bloc's offer.

As a signatory of the Non-Proliferation Treaty (NPT), Iran has the right to build a civilian nuclear program, but it must submit to inspections by the International Atomic Energy Agency (IAEA), the UN watchdog body. It has refused to fully cooperate with the agency and Ahmadinejad has pledged to forge ahead as international pressure to give up enrichment has increased.

"This is one of the last chances to resolve this conflict from a diplomatic point of view," Luxembourg Foreign Minister Jean Asselborn told reporters. "We are ready to cooperate in the civilian nuclear domain and in trade and political areas. I think the Iranians are going to understand that the Europeans are courageous and are proposing something very important."