North Korea told the United States on Thursday that it would test a nuclear weapon unless Washington accepted Pyongyang's proposal for a freeze on its atomic program, a senior administration official said.

Vice Foreign Minister Kim Gye Gwan (search) spoke with Assistant Secretary of State James A. Kelly (search) in a 21/2-hour private discussion in China, where a six-nation conference is being held on the long-running impasse over Pyongyang's nuclear ambitions.

Early Friday, China canceled a scheduled closing ceremony for the talks. A Chinese government spokesman gave no reason.

"The meeting will end, but there will be no closing ceremony," said a spokesman for the Chinese Foreign Ministry office. He would give only his surname, Wang.

The United States has been insisting on complete disarmament by the communist state and submitted a proposal to the conference on Wednesday outlining the benefits North Korea could receive if it complies.

The senior administration official said the North Korean threat suggested that the Beijing discussions were headed toward failure.

There was no indication of when North Korea might carry out its reported threat to test. The United States is uncertain as to how many weapons North Korea possesses, but thinks it has at least one or two with the potential for several more.

Near the end of their discussion, Kelly told Kim that there was little trust in Washington for North Korea and that Kim's statements wouldn't improve matters, the senior official said.

The official declined to be identified because private diplomatic exchanges are normally kept confidential.

Thursday's discussion with Kim was not the first time that a North Korean diplomat issued a nuclear test threat. A similar warning came during a meeting between North Korean diplomat Ri Gun and Kelly 14 months ago, also in Beijing.

State Department spokesman Richard Boucher (search) had no comment on Kelly's meeting with Kim, except to confirm that it took place.

The United States is demanding the complete, verifiable and irreversible dismantling of Pyongyang's weapons program.

It has been hopeful that the impoverished country would be willing to meet the demand in return for a brighter economic future for its people and broader diplomatic acceptance in the region and beyond.

During a closed plenary meeting on Thursday, North Korea demanded massive energy aid in exchange for a nuclear freeze, the Kyodo news agency of Japan reported, citing diplomatic sources.

The report said Pyongyang asked for 2,000 megawatts of power per year — an estimated one-fourth of its current total consumption. In the United States, a megawatt can supply power to about 1,000 homes.

Boucher refused comment on the reported proposal.

"The most concrete...and specific proposal on the table is that made by the United States yesterday with the support of other governments who were there," Boucher said.

"We look to the North Koreans to study that proposal seriously," he said.

Other participants are China, South Korea, Japan and Russia. All agree with the United States that a denuclearized Korean peninsula is a worthy goal.

Kim said earlier during the conference that his government has been developing nuclear weapons for protection from possible U.S. attack.

"If the United States gives up its hostile policy toward us ... we are prepared to give up in a transparent way all plans related to nuclear weapons," he said.

Both Japan and South Korea say they would consider giving the North fuel oil if it freezes its nuclear program as a step toward its eventual dismantling.

Russia would be willing to help provide energy aid and security guarantees, said Russian envoy Alexander Alexeyev, according to the Russian news agency ITAR-Tass. The report did not say what conditions Russia might attach to that offer.