South Carolina Governor Mark Sanford, facing pressure to resign over an extramarital affair, said on Thursday he would repay state funds he used for an official trip to Argentina during which he met his mistress.

Sanford's move came as questions mounted whether he had used public funds to pursue a yearlong affair with the woman.

His admission of marital infidelity during a tearful news conference on Wednesday likely ended chances he might be a Republican contender for the U.S. presidency in 2012.

The governor said he participated in a U.S. Commerce Department trade mission a year ago to Brazil and Argentina.

While the purpose of this trip was an entirely professional and appropriate business development trip, I made a mistake while I was there in meeting with the woman who I was unfaithful to my wife with, Sanford said in a statement.

That has raised some very legitimate concerns and questions, and as such, I am going to reimburse the state for the full cost of the Argentina leg of this trip, he said.

He was due to hold a state Cabinet meeting on Friday, his office said.

Sanford announced on Wednesday his resignation as chairman of the Republican Governors' Association, and attention has since shifted to whether he will resign as governor. His second term ends in January 2011.

The Washington Post, quoting a close adviser, reported on Thursday that Sanford was not considering resigning.

Attention has also focused on whether Sanford abdicated responsibility by disappearing from the state for six days starting last Thursday without telling aides where he was going. He told them initially he was going hiking on the Appalachian Trail in the Eastern United States.

But at his news conference on Wednesday after returning by plane from Buenos Aires, he said he created a fiction for aides and was actually visiting his lover in Argentina over the Father's Day weekend.

'CLOSE TO GAME OVER'

South Carolina Republican Party official Glenn McCall said Sanford should resign because his previous statements about the importance of family values and his criticism of former President Bill Clinton's marital infidelity amounted to hypocrisy.

South Carolina Senate Majority Leader Harvey Peeler, also a Republican, said Sanford's prospects appeared grim.

It is close to game over. ... If anyone can prove he did this (met his lover) with taxpayer money, the deal is off. I am concerned that is coming, said Peeler.

Local media said Sanford visited the house on Thursday where his wife, from whom he is separated, and children are staying.

A string of Democratic and Republican politicians have seen their careers ruined in recent years by marital indiscretions, which are viewed harshly in the United States, a country that demands high standards of personal morality from its public officials.

In Buenos Aires, TV crews staked out the apartment building where the woman involved in the affair is reported to live.

Argentine newspaper Clarin identified her as Maria Belen Shapur, 43, a divorced mother of two who works at a multinational grains exporter.

(Additional reporting by James Scott in Charleston, South Carolina and Kevin Gray in Buenos Aires)

(Editing by Pascal Fletcher and Peter Cooney)

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