The remarks will come as a boost to Western hopes of diversifying gas deliveries away from Russia, which currently provides Europe with about one-fourth of its gas needs.

Disagreement among the five states on the Caspian _ Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan _ on how to divide the sea have hindered plans to build a pipeline bridging Central Asia's vast energy supplies with the West.

"We actually believe that it is possible to have agreement to move gas across the Caspian without reaching a final agreement on delimitation," said Daniel Stein, senior assistant to the U.S. special envoy for Eurasian energy.

Iran has insisted that any territorial agreement should give an equal portion of the seabed to each of the five shoreline states, while other countries want the division to be based on shoreline, which would give Iran a smaller share.

The most direct route for a trans-Caspian gas pipeline would run across the seabed between Turkmenistan and Azerbaijan, but the two former Soviet states also have been mired in a dispute over ownership of subsea energy resources.

Central Asian gas supplies delivered through the trans-Caspian pipeline would be fed into the planned $8 billion Nabucco pipeline, which would run onward to Turkey, Bulgaria, Romania, Hungary and end in Austria.

"Both the United States and Europe have encouraged both sides to work together to reach agreement, so that Turkmen gas can move across the Caspian to Azerbaijan into Nabucco or other projects in the southern corridor," Stein said.

The subsea pipeline proposal faces stiff opposition from Russia, which has cited environmental concerns in its objections to the route.

Stein also said U.S. companies are still exploring options for gaining concessions to develop oil and gas reserves in Turkmenistan.

"Participation of American companies would be helpful in Turkmenistan because they have great experience in some of the very of the difficult conditions (involved) in developing some of these blocks," he said.

Turkmenistan is the largest gas producer in the former Soviet Union after Russia, which has had a lock on most of the reclusive desert nation's gas exports since the Soviet collapse in 1991. Turkmenistan estimates its total reserves at more than 20 trillion cubic meters (26 trillion cubic yards), but international experts have questioned that figure.