The United States has said that it is willing to consider energy aid to Pyongyang if it gives up its nuclear programme.

Mr Kelly has been in talks with South Korean leaders

Assistant Secretary of State James Kelly, on a visit to South Korea, also reiterated Washington's willingness to hold talks with North Korea, in spite of Pyongyang's statement on Friday that it was pulling out of the nuclear Non-Proliferation Treaty (NPT).

Mr Kelly's visit came amid intense diplomatic efforts to defuse the crisis over North Korea's nuclear ambitions.

Mr Kelly hinted at energy aid following an hour of talks with South Korea's President-elect, Roh Moo-hyun.

"Once we get beyond nuclear weapons, there may be opportunities with the US, with private investors, with other countries to help North Korea in the energy area," Mr Kelly said.

Pyongyang has used a US-led decision to halt fuel shipments as its justification for reactivating a nuclear reactor, though analysts say the plant is too small to generate meaningful amounts of electricity.

The US-orchestrated decision was punishment for the North's alleged admission of a separate, enriched uranium programme in October.

Call for dialogue

Mr Kelly's offer follows calls by former American diplomat Bill Richardson, who has been in contact with North Korean officials, for the US administration to begin a dialogue.

Mr Richardson, who completed three days of unofficial talks on Saturday, said that the combative approach of Pyongyang masked a willingness to negotiate.

CRISIS CHRONOLOGY

16 Oct: N Korea acknowledges secret nuclear programme, US says 14 Nov: Oil shipments to N Korea halted 22 Dec: N Korea removes monitoring devices at Yongbyon nuclear plant 26 Dec: UN says 1,000 fuel rods have been moved to the plant 31 Dec: UN nuclear inspectors leave North Korea 6 Jan: IAEA demands inspectors be readmitted and secret weapons programme halted 7 Jan: US "willing to talk" to North Korea 10 Jan: N Korea pulls out of nuclear treaty 11 Jan: Pyongyang suggests it could resume ballistic missile tests

Timeline of tensions

"It's important that direct talks happen. I can't stress how important that is. And it can be at the technical level, low level," Mr Richardson, who met North Korean officials in New Mexico over the weekend, said on US ABC television.

"What I think the administration needs to do, with all due respect, is just pick up the phone, start the preliminary talks," he said.

Alarm over Pyongyang's nuclear programme has been growing since it reopened last month a nuclear plant that can be used to produce weapons-grade plutonium.

North Korea says the plant will be used to generate electricity.

Mr Richardson said that the United States should take account of the North Koreans' mindset.

"They don't negotiate like we do" he said.

"They believe in order to get something they have to lay out additional cards, step up the rhetoric, be more belligerent," he said.