US President George W. Bush has asked Congress for 20 million dollars to rent, refurbish and secure the site, and the officials said they expected the interim embassy to be up and running shortly after Saddam Hussein has been ousted.

"We have actually identified a hotel which would provide interim office capability plus quarters for a limited number of people we would have there initially," said Under Secretary of State for Management Grant Green.

Neither Green nor Deputy Secretary of State Richard Armitage, who were testifying before a House budget subcommittee, gave specifics about which hotel had been chosen as the site.

But they defended the decision to lease a temporary facility instead of immediately purchasing a site and starting to construct a new embassy, saying the use of the hotel would be more effective in the short term.

In addition to the 20 million dollars for the interim mission, Bush asked Congress last week for 35.8 million dollars for a new, well-fortified embassy in the longer term.

Armitage told the subcommittee that the cost of that facility would jump by another 137 million dollars as the department moves to ensure it meets security standards imposed after the 1998 bombings of the US embassies in Kenya and Tanzania.

About 200 US officials from the State Department and other government agencies are eventually expected to work out of the new, permanent embassy in Baghdad which Washington hopes to be in operation within five years, Armitage said.

"One would hope after this that perhaps we wouldn't have to take five years to negotiate with the new Iraqi authorities," he said.

It remained unclear whether the permanent embassy would be located on the site of the former mission, built in the late 1940s, which Armitage said was not in particularly good condition when the last US diplomats left Baghdad ahead of the 1991 Gulf War.

The high cost of the embassy is due to security requirements "commensurate with the threat level" in Baghdad, which is expected to be high for some time after the war is over, State Department officials said last week.

In addition to construction costs, the money will go toward the purchase and installation of barriers around the perimeter, closed-circuit television cameras, video equipment, bomb detection devices and armored vehicles, they said.

The new embassy will also be equipped with state-of-the-art chemical and biological weapons counter-measures, and it will be patrolled by a "US surveillance detection team" as well as local guards, the officials said.

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