Number 10 has played down suggestions of an imminent breakthrough in the stalled Northern Ireland peace process.

The comments came as Northern Ireland's political leaders met with the US special envoy to Ulster. The meetings with Richard Haass come a day after discussions at Downing Street ended without a deal on devolved elections.

Despite an initial deadline of Wednesday, Downing Street conceded that further talks would be necessary before the election date could be set.

Number 10 said Monday's summit - which brought together the British and Irish premiers along with David Trimble and Gerry Adams - had been constructive.

But the spokesman admitted that a "further period of intense talking" would be required.

Downing Street said the prime minister stands ready to enter into further negotiations later this week.

The government had hoped the summit would produce an agreement on restoring the devolution process.

No deal was reached but the prime minister offered an upbeat assessment of progress.

"The omens are all very, very good if we can find the right way of having the election in a positive and constructive atmosphere and I hope very much that we can do that," Blair said.

Adams added that all parties should seek to make progress together. "The only way I think that we can make the type of progress that is required is if we collectively proceed," he said.

Ahead of the talks, Trimble said that people in Northern Ireland want to see the assembly restored.

"The question is whether the assembly can be a functioning one," he added.

"Whether we can [succeed] depends on whether republicans can meet the challenge this time as they failed to do in April."