Iranian President Mahmoud Ahmadinejad says he has pardoned the 15 British sailors and marines detained in the Gulf last month.

Also Iranian President Mahmoud Ahmadinejad gave medals of honor to the Iranian coast guards who intercepted the 15 British sailors and marines in the Gulf, saying Iran will never accept tresspassing of its territorial waters.

"On behalf of the great Iranian people, I would like to thank the Iranian coast guard for courgaeosuly defending our Iranian territorial waters," the president told a press conference.

He then pinned medals on the chests of three Coast Guard officers.

Also Wednesday, Iran's state media reported that an Iranian envoy will be allowed to meet five Iranians detained by U.S. forces in northern Iraq since January — a possible sign of further progress toward ending a British-Iranian standoff.

A U.S. military spokesman in Baghdad said, however, that American authorities were still considering the request. The spokesman, Maj. Gen. William C. Caldwell, said an international Red Cross team, including one Iranian, had visited the prisoners but he did not say when.

The report appeared as Britain and Iran were entering a sensitive phase in the efforts to free 15 British sailors and marines captured by the Iranians last month in disputed waters of the Persian Gulf.

A separate Iranian diplomat seized two months ago by uniformed gunmen in Iraq was released and returned Tuesday to Tehran. Iran had blamed the U.S. for the abduction, a charge American authorities denied.

Iran's official Islamic Republic News Agency said an Iranian envoy would be allowed to meet with the five detained Iranians but gave no further details.

The moves in the case and the separate release of the Iranian diplomat raised the possibility that a possible swap was in the works.