Washington  - Libyan and US officials held two days of talks in London this week to begin negotiations on terrorism-related claims that are standing in the way of full relations between the two countries, the US State Department said Friday.

"Both parties affirmed their desire to work together to resolve all outstanding claims in good faith and expeditiously through the establishment of a fair compensation mechanism," a joint statement from the two countries said.

The statement was issued via email.

The cases involve the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland that killed 270 people, the bombing of a Berlin disco frequented by Americans in 1986 and the downing of a French airliner in 1989 carrying US citizens over Niger.

In March, US officials said the Libyan government offered a settlement for resolving civil lawsuits brought against the country by victims of terrorism, but further details were not available.

In Friday's statement, Libya and the US repeated "their commitment to further develop bilateral cooperation" and "affirmed their mutual cooperation to combat terrorism."

The United States announced in May 2006 that it was restoring ties with Libya after leader Moamer Gaddafi agreed to abandon the country weapons of mass destruction programmes.

Since then, Libya has moved more solidly into the international community, serving as rotating president of the United Nations Security Council earlier this year.

But foreign investors are wary of putting their money into the north African country out of concern that investments could be seized as part of court rulings that could be made in favor of the survivors and families of the dead from the bombings.

US companies are keen on contracts to develop the country's oil and gas reserves and other projects. Libya, which holds Africa's largest oil reserves, aims to increase output to 3 million barrels of crude a day by 2013 from 1.77 million barrels in April, according to Bloomberg financial news agency. (dpa)