Marshall Islanders are still plagued by health and environmental effects of 67 U.S. nuclear bomb tests from 1946 to 1958, which included "Castle Bravo" at Bikini Atoll in 1954 - the largest U.S. bomb ever detonated.

Foreign Minister Jack Ading told a U.S. congressional hearing a memorandum of understanding on terms to extend his country's Compact of Free Association (COFA) with Washington was signed in January without proper domestic authorization and under pressure of a deadline for inclusion in President Joe Biden's budget.

"There are other issues that needed to included, and especially, additional funding for the nuclear-affected populations," he told the Senate Committee on Energy and Natural Resources, appealing to Congress to direct the Biden Administration to continue negotiating.

The Marshall Islands is one of three Pacific island nations covered by COFAs, under which the U.S. has responsibility for their defense and provides economic assistance, while gaining exclusive access to huge strategic swathes of the Pacific.

Renewing the deals, which is subject to congressional approval, has become a key part of U.S. efforts to push back against China's bid to expand its regional influence.

Under MOUs agreed this year, the U.S. will commit a total of $7.1 billion over 20 years to the three nations.

In May, the U.S. said it had finalized COFA terms with Micronesia and Palau and hoped do so with the Marshall Islands in coming weeks. The economic terms of its existing COFA expire at the end of the fiscal year on Sept. 30.

More than 100 activist groups have urged Washington to formally apologize to the Marshall Islands and provide fair compensation.

Chief U.S. negotiator Joseph Yun told the hearing he was "puzzled" by the Marshall Islands' position, given the MOU offered it $2.3 billion over 20 years and that the nuclear liability issue had been "settled" in the 1980s. The MOU also contained $700 million for a trust fund that could be used for nuclear-affected atolls.

"I have told my Marshallese colleagues, listen, there is no more money," Yun said, adding that the MOU figure was over double that in the last agreement.

"It's my understanding that our congressional members agree with the administration that this is a very generous offer," he later told Reuters. Yun said he had asked Congress to approve the $7.1 billion total by Sept.30.

"I'm optimistic that our Congress will enact the legislation," he said, adding he was open to more talks with the Marshall Islands "on how and where the money should be spent."

Yun told the committee he believed domestic politics was at play in the Marshall Islands, with an election in November and rumors President David Kabua could face a no-confidence motion.

Denying this, Ading said he was "saddened and disappointed" by the reference to internal affairs.