[TEXT OMMITTED FROM SOURCE]

President Carter and Vice President Mondale initially met privately with Dayan for 35 minutes. The discussions then expanded to full delegations on both sides, including Vance, presidential national security adviser Zbigniew Brzezinski, chief presidential political adviser Hamilton Jordon, and others.

What emerged officially was a statement carefully phrased to put the most favorable light on the U.S.-Israeli differences, with many ambiguities. Dayan told reporters, "The statement says everything for both of us. We worked hard on that statement."

It said, in part, that President Carter "underlined his conviction that a just and lasting peace in this vital area of the world requires compromise and courageous leadership from all the parties to the negotiations."

Although the statement said that Carter and Dayan "emphasized the importance of . . . resuming the Geneva conference," which met only fleetingly after the 1973 Arab-Israeli war, it acknowledged, by omission, no agreement on how that conference should be reconvened.

The statement said simply that "there was an exchange of views on the question of the Palestinian representation and the question of Israeli settlements." The United States repetedly has protested Israel's extension of settlements into Arab-occupied territory won in the 1967 war.

Only brief mention was made in the statement of Israel's main emphasis at this stage, namely, its proposals for a draft peace treaty with the Arab nations.

What Israel is advocating in return for full peace reportedly involves substantial withdrawals in the Sinai Peninsula, some border changes on the cease-fire with Syria in the Golan Heights, but continued Israel security authority over the Gaza Strip and the West Bank of the Jordan, with a large measure of self-governing Arab autonomy. The Arab nations insist on total return of all this territory, with the PLO demanding a separate Arab state.

Facing skeptical reporters at the end of the White House talks with Dayan, Powell said "these talks were not designed to reach agreement." Instead, he said, they are part of an exploratory process. This will continue on Wednesday with Egyptian Foreign Minister Ismail Fahmy, and go on to furher discussions at the foreign-minister level in New York and Washington in the next few weeks.

Secretary Vance, the White House statement said, will discuss with Dayan "some specific suggestions for reconciling the differences between the parties."

Powell said, "We have differences on the . . . question of Palestinian participation" in a Geneva conference. But "We alone," he said, "cannot decide who those representatives will be," and "we hope a formula acceptable to all can be found."

Dayan, in his few comments to reporters during the day, said his sudden change in travel plans over the weekend, which caused him to double back to Israel from Europe, was to report to Israeli Prime Minister Menahem Begin about "a meeting." He declined to say whom he met with in Europe.

ABC-TV reported last night that Dayan secretly went to London for a meeting with Jordan's King Hussein, and that Hussein left that meeting pessimistic about prospects for a peace settlement. There was no official confirmation of that report.