David Cameron hosted a lavish reception in the Downing Street garden for Northern Ireland's Democratic Unionists last week, prompting senior party figures to say the prime minister is wooing its MPs ahead of a possible hung parliament where their support could be crucial to his survival.

In a move that may prompt claims that he is prepared to play the "Orange card" if he fails to win an overall majority in next year's general election, the prime minister paid court to the party's eight MPs, who could hold the balance of power in a hung parliament.

Cameron invited the DUP MPs, who make up the fourth largest party at Westminster, for drinks in the No 10 garden on Wednesday evening last week.

That followed a meeting to discuss Britain's efforts to persuade the Libyan authorities to offer information relating to shipments of weaponry by the Gaddafi regime to the IRA in the 1980s.

Peter Robinson, the Northern Ireland first minister who lost his East Belfast seat at the last general election, was joined at the Libya meeting by the DUP MPs Nigel Dodds and Jeffrey Donaldson.

The subsequent reception in the garden, attended by the DUP's MPs and Robinson, was held on the evening that Gerry Adams was arrested by police investigating the disappearance of Jean McConville in 1972.

The MPs were given the impression that Cameron was going out of his way to lay on the charm by allowing his children to play among the guests as drinks, including non-alcoholic ones for the teetotal drinkers, were served.

One senior DUP source told the Guardian: "It would be fair to say that a lot of wooing is going on. You don't invite eight parliamentarians to such a reception and have the children playing round unless you are seriously interested."

The DUP is drawing up the demands it would table as the price for supporting Cameron in the event of a hung parliament. The party is keen to use the opportunity to secure funding for pet projects.

Some DUP sources have raised the prospect of a "confidence and supply" arrangement with Cameron in a hung parliament – ensuring the Queen's speech and the budget would be passed but offering support on everything else on a case-by-case basis. There would be no DUP Westminster government ministers.

Nationalists may accuse Cameron of playing the "Orange card" – the historical phrase to describe the appeasement of Ulster unionism – if he relies on the DUP for his survival. Republicans felt that John Major was hobbled in his response to the IRA ceasefire in 1994 as he became increasingly dependent on the Ulster Unionist party, at that time Northern Ireland's largest, for support.

Cameron insists he is on course to secure an overall majority at the general election – a point he made to the DUP MPs. But Downing Street knows that the electoral arithmetic may once again deprive him of an overall majority, meaning that he would depend on other parties for survival if the Tories were the largest party in a hung parliament. The prime minister would face a battle to re-establish a coalition with the Liberal Democrats because the Conservative 1922 committee, whose officers are wary of the Lib Dems, have demanded to be consulted on the formation of a second coalition.

The DUP source said the prime minister was careful to say he was confident of victory, though the party was left with the distinct impression that Cameron is keen to ensure relations remain warm. The source said: "There was nothing as crude as saying I might lose and so I need your help. The prime minister said he is confident he will win. But it is clear he wants to keep lines open. He understands Northern Ireland well. He knows the personalities. He has a feel for it. That helps."

Another DUP source said: "If someone wants my vote then of course I will talk to them. If they have made an effort before they need my vote then relations will be better when they need it."

But the party would keep its options open. "We are in contact with all parties. We would go and see Labour and Ed Miliband on such terms."

The DUP is scathing about the close relationship the former UUP leader Jim Molyneaux formed with John Major as the former prime minister's majority dwindled in the 1990s. The party believes that Molyneaux was double crossed by Downing Street which forged stronger relations with the Irish government in the early stages of the peace process. This explains why the DUP will focus on gaining financial benefits for Northern Ireland in any deal with No 10.

The prime minister has had to work hard to build up relations with the DUP, which has had stronger relations with Labour in recent years. Tony Blair carried out what was described as his last great political seduction when he won over the Rev Ian Paisley before the political settlement in 2007 that led the DUP founder to share power with Sinn Féin's Martin McGuinness.

The DUP has traditionally been wary of the Tories because Margaret Thatcher introduced the 1985 Anglo-Irish Agreement which gave Dublin the right to be consulted over Northern Ireland. The Conservatives also once had a formal link with the DUP's historic rival, the Ulster Unionist Party - a relationship Cameron revived for the last general election.

Cameron is taking immense care to say nothing in public or private to indicate that he fears the election will produce another hung parliament. But many ministers fear that the Tories' best hope is to emerge as the largest party in a hung parliament, forcing the prime minister to turn to other parties.

A No 10 spokesman said: "The prime minister has regular meetings with MPs from Northern Ireland to discuss a range of issues."