military pulls out of Bermuda, Congressional sources hinted yesterday.

And there remains a possibility the US Navy may decide to maintain a presence at its East End Base.

Senators and Congressmen remain locked in a conference this week to work out a 1994 defence spending bill.

But they appear to have already decided the fate of the US Naval Air Station during deliberations last week.

A source in Washington told The Royal Gazette that a conference compromise on a Bermuda withdrawal plan was based on competing positions of 18 months and two years.

But a rider may be attached to the Bermuda clause in the Defence Bill requiring the Department of Defence to first study the Base before a withdrawal timetable is imposed.

That study would be required by Congress some time next year, meaning the Base would continue operating for at least another two years.

"I think the new clause is something that the Government of Bermuda and the British Government will be happy with,'' said the Congressional source, who spoke on condition of anonymity.

"I can't disclose the details of the final agreement, but I think it's going to address the problem the British Ambassador brought to our attention of the need for an adequate transition period for Bermuda.

"We don't want to pull up stakes until the Bermuda Government can operate the Airport in a safe manner.'' The Bermuda Base issue is just one of hundreds the Congressional Conference must agree on for the final draft of the 1994 Defence Bill.

It required the Conference to come to grips with a clause that would have withdrawn funding for the US Naval Air Station within three months of passage.

That clause was drafted by members of the House Armed Services Committee following ABC newsman Sam Donaldson's PrimeTime Live report characterising the Bermuda Base as the Navy's Club Med.

But the Congressional source said Congressmen were unaware of a US-UK treaty obliging the US to give a one-year withdrawal notice.

The source said the Conference had become well aware of Bermuda's position on the Base.

"The concerns of Bermuda have become very well known to all members of the House and Senate,'' he said. The Bermuda clause "has been the topic of a lot of discussion among the Conference members.'' The source added that members were under a lot of pressure domestically to do something about the Base. He said the pressure was generated by the Donaldson report and had "nothing to do with Bermuda itself.'' He said millions of Americans were looking a pink slips with depots and shipyards closing. He said 50 to 60 military installations had been shut down this year.

"And then for the American people to see in paradise a military base without a mission, with no role in the post Cold War period being kept open to support a tourism industry is hard to justify,'' he said.

"Sam Donaldson put that into the public eye. Based on those pressures members felt they had to do something.'' The Congressional staffer said the Department of Defence had concluded the Bermuda Base no longer had military value. But a new review, with strong Navy involvement, could result in a decision to keep a token presence in Bermuda to preserve US landing rights.

Nevertheless, an 18-month to two-year transition to closure would see US Navy personnel training Bermudians to take over operations such as air traffic control and emergency services.

If it took longer than the transition set by Congress, Bermuda would probably have to reimburse the US for training with payments drawn from the $2.4-$2.6 million annual landing fees now paid to Bermuda.

"We want to make sure we don't harm a valuable ally and we don't want to harm a country, which would suffer through no fault of its own by our quick departure,'' the Congressional source said.