* First known visit since uprising began five months ago
* Russia says important to engage government, not isolate it
(Recasts, adds more Libyan foreign minister quotes)
By Steve Gutterman
MOSCOW, July 20 (Reuters) - Libya’s foreign minister denied on Wednesday that there were talks about easing Muammar Gaddafi out of power, but said his government wanted to end the nation’s bloody conflict in a way that would satisfy all Libyans.
“Gaddafi’s departure is not being discussed,” Abdelati Obeidi said after talks with Russian Foreign Minister Sergei Lavrov, the Russian news agency Interfax reported.
Obeidi said the confrontation between Gaddafi’s government and rebels seeking to end his 41-year rule would not be resolved by force and said foreign support for the rebels “will not help solve the problem”, Interfax reported.
“We must all work on a peaceful solution in which all Libyans would participate and not just the council in Benghazi,” he was quoted as saying in a reference to the rebel Transitional National Council (TNC).
The closed-door meeting was part of a Russian effort to engage Gaddafi’s government, in contrast to what it calls a counterproductive Western “policy of isolation”.
Moscow says Gaddafi must give up power but has also criticised Western military and diplomatic support for the rebels in Libya, where Russia had billions of dollars in energy, arms and infrastructure deals.
President Dmitry Medvedev, whose Africa envoy has met both rebels in Benghazi and top officials in Tripoli in recent weeks, said on Tuesday there was still a chance for compromise between the warring sides.
Echoing Russia’s inclusive tone, Obeidi said, “We came out with a proposal that it is necessary to find a solution that would be acceptable to all Libyans, including the opposition in Benghazi,” state-run Russian news agency RIA reported.
But there was no sign of flexibility on the fate of Gaddafi, who has refused to step down.
Konstantin Kosachyov, a leading pro-Kremlin lawmaker who heads the international affairs committee in Russia’s lower parliament house, said the Moscow meeting had been requested by the Libyan side and called for cautious optimism.
“It means that people who are still in power in Tripoli are ready to talk and not just suppress the resistance of the population with tanks or other heavy weapons,” said Kosachyov, a member of Prime Minister Vladimir Putin’s ruling party.
Kosachyov cast Russia’s diplomacy as the “antithesis” of the approach of Western nations that have bombed state facilities and recognised the TNC as Libya’s legitimate government.
Such actions undermine diplomacy and “lead the negotiations track into a dead end,” Kosachyov told reporters.
“With the full understanding that Gaddafi’s regime really has no future and really cannot remain in power, the difference is that we are ready to continue talking to this regime in order to induce it into political contacts with the opposition and in the final result induce it to leave power,” he said.
Dmitry Trenin, a foreign policy analyst and director of the Carnegie Moscow Center, said Obeidi’s visit suggested members of Gaddafi’s circle were seeking a way out, but that Gaddafi still held the key to a resolution.
“He has had many opportunities to begin bargaining, to set out some conditions in exchange for leaving his position of power, but he has not used them yet,” Trenin told Reuters.
Kosachyov, who often serves as an informal spokesman on Kremlin foreign policy, said Gaddafi and his government should be offered guarantees in exchange for leaving power but reiterated that Russia would not take Gaddafi in.
For Gaddafi, “probably what can be discussed is some kind of guarantees of his personal security, the security of members of his family,” said Kosachyov.
Trenin said members of Gaddafi’s circle were eager to ensure their own future security.
“He may decide to die in Tripoli, but those around him do not want to die with him, they do not want go to the bottom with him,” he said. (Editing by Alistair Lyon)