Iran rejects demands to abandon enrichment

TEHRAN (Reuters) - Iran refused on Saturday to stop uranium enrichment after a U.N. report said it had done little or nothing to prove it was not developing nuclear arms.

Instead, it repeated a long-standing offer to let international inspectors make unannounced checks as long as the U.N. Security Council -- invoked by the West several months ago to put pressure on Iran -- dropped the case.

Mohamed ElBaradei, head of the U.N. International Atomic Energy Agency (IAEA), delivered a report on Friday saying U.N. checks in Iran had been hampered and Tehran had rebuffed requests to stop making nuclear fuel.

Mohammad Saeedi, deputy head of Iran's Atomic Energy Organization, told state television that Iran wanted the Security Council, which has the power to impose sanctions, to pass the case back down to the IAEA.

"If the case returns to the agency again, we will begin the section that concerns the Additional Protocol," Saeedi said.

The Additional Protocol to the nuclear Non-Proliferation Treaty allows short-notice inspections of nuclear facilities.

"The enrichment will continue. But ... we will continue implementing the Additional Protocol as a voluntary measure," Saeedi said.

"If they change their decision and choose the wise path, and the case returns to the IAEA, we believe we can solve all the issues mentioned in ElBaradei's eight-page report very quickly."

GAPS IN KNOWLEDGE

Iran insists it is merely using its sovereign right to enrich uranium at a low level to fuel power stations -- and not aiming for the highly enriched form that could power a warhead.

The major world powers say it must first prove, after years of secret nuclear research, that it is not developing a nuclear bomb, and it can only do this by halting all nuclear enrichment.

ElBaradei's report said the IAEA was "unable to make progress in its efforts to provide assurance about the absence of undeclared nuclear material and activities in Iran".

"The existing gaps in knowledge continue to be a matter of concern," it added. "Any progress in that regard requires full transparency and active cooperation by Iran. These transparency measures are not yet forthcoming."

U.S. politicians and the European Union struck different tones at a transatlantic conference on how to respond to Iran's nuclear defiance.

EU foreign policy chief Javier Solana told the Brussels Forum on Saturday no one was considering military action over Iran and Europe did not want to join a "coalition of the willing" against Tehran.

But influential U.S. Senator John McCain said: "There is only one thing worse than military action, and that is a nuclear-armed Iran." He said the United States would not stand by and let Iran wipe out Israel, as Iranian President Mahmoud Ahmadinejad had called for.

Former U.S. Assistant Secretary of State Richard Holbrooke said: "Iran is THE test case about whether we'll have effective transatlantic cooperation."

LEGAL FORCE

Western diplomats at the United Nations in New York have said they plan to introduce a resolution to the Security Council within a week giving legal force to the Council's demands.

The United States, backed by Britain and France, support limited sanctions but the other two veto-wielding permanent Council members, Russia and China, are more guarded.

Russian Foreign Minister Sergei Lavrov told his Iranian counterpart Manouchehr Mottaki on Saturday to suspend enriching uranium and ensure full-scale cooperation with the IAEA.

"The Russian side reiterated there is an urgent need for Iran to take concrete steps to restore trust in its nuclear programme," Russia's Foreign Ministry said in a statement.

The foreign ministers of the five permanent members will meet, along with Germany, on May 9, the United States said.

China's ambassador to the United Nations, Wang Guangya, told the official Xinhua News Agency in New York on Friday that consideration of sanctions or military measures would not help to resolve the issue.

Iran's Ahmadinejad reiterated that Iran would never give up its right to peaceful atomic technology.

"That is our red line, and we will never cross it," state television quoted him as saying.