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Report: Libya providing intelligence to US | (UPI) -- Libyan leader Moammar Gadhafi was quoted as saying that Libya is providing intelligence to the United States on al Qaida terrorists blamed for the Sept. 11, 2001 attacks on the World Trade Center and Pentagon.

"Intelligence agencies in Libya and the U.S. are exchanging information," he said in an interview published in the latest edition of Newsweek magazine.

"There are Libyan terrorists in America and in Britain. The Libyan intelligence service exchanges information (with Britain and the United States) so that they will be wiped out."

Asked if there would be another al Qaida attack on the United States, Gadhafi said: "If they can, they will not hesitate. (Osama)Bin Laden has convinced his followers that America is attacking the whole Arab and Islamic world. He told them in the beginning that America's objective was not only Afghanistan. Now that there is a move against Iraq, it has proven bin Laden right."

In the Newsweek interview, Gadhafi made it clear that he would like to see U.N. sanctions lifted against his country. But sanctions will remain unless Libya accepts responsibility for the 1988 bombing of Pan Am 103 over Lockerbie, Scotland.

"Is there any state that would take responsibility for the bombing of a civilian aircraft and the killing of 270 people?" he said.

"We feel sorry irrespective of who did it. Libya also may contribute to the compensation."

Lawyers representing Libya signed an offer in October to compensate relatives of the 270 people killed in the Pan Am 103 bombing. A Libyan, Abdelbaset Ali Mohmed al-Megrahi, was convicted for the bombing.

"The court came to its finding without evidence," Gadhafi insisted, but said there have been negotiations for a compensation fund.

"We hope an agreement can be reached to solve the Lockerbie problem and provide suitable compensation which Libya alone will not pay. Perhaps Libya and the -- U.S. will contribute to a compensation fund."

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