Iran begins fresh atom enrichment despite powers' offer

VIENNA (Reuters) -Iran began a fresh phase of uranium enrichment this week just as world powers presented it with incentives to halt nuclear fuel work, according to a U.N. nuclear watchdog agency report obtained by Reuters on Thursday.

The report, emailed to the 35 states on the International Atomic Energy Agency's governing board ahead of a meeting starting on Monday, also said Iran was pressing ahead with installing more cascades of centrifuge enrichment machines.

Authored by IAEA chief Mohammed ElBaradei, the report said Iran resumed feeding "UF6" uranium gas into its pilot 164-centrifuge cascade in Natanz on Tuesday after a pause of several weeks to do test runs of the machines without UF6.

Tuesday was the day European Union foreign policy chief Javier Solana visited Tehran to hand over a packet of economic, technological and security incentives for Iran to suspend work which could eventually produce atomic bombs.

The Islamic Republic says the goal of its nuclear fuel program is solely electricity generation for its economy. The West suspects that Iran, the world's No. 4 oil producer, of creating a smokescreen for atomic bombmaking.

In April, Iran appeared to defeat a Western bid to deny it enrichment technology when, for the first time, it purified a small amount of uranium at Natanz for use as power plant fuel.

A Western intelligence source told Reuters hours before the IAEA report that Iran stopped feeding gas into its pilot cascade later in April because of technical glitches, but then resolved them, allowing an enrichment resumption this week.

"This underlines the fact that the temporary halt was technical in nature. It's a continuation of Iranian policy to profit from all worlds -- dialogue to gain time while continuing to strive for an atomic bomb," the source said.

The report confirmed diplomatic leaks that new traces of highly enriched uranium, the key fissile ingredient in atomic bombs, had turned up on equipment from the ex-military Lavizan-Shian site, razed by Iran in 2004 before inspectors could examine it.

IAEA inspectors earlier this year took swabs from vacuum pumps used at Lavizan. Vacuum pumps have "dual" civilian or military uses but are needed when enriching uranium with a cascade of connected centrifuges.

Iran has said such traces, detected earlier at some other sites in Iran, originated on equipment imported from Pakistan, which has nuclear arms, and did not come from Iranian activity.

ElBaradei's report said Tehran was still stonewalling a three-year-old IAEA probe into military links with nuclear fuel work, echoing a string of earlier reports.

Vienna-based diplomats familiar with IAEA inquiries in Iran say it is withholding answers as bargaining chips for any talks with U.N. Security Council powers on its nuclear aspirations.

Iran continuing uranium enrichment: IAEA

VIENNA (AFP) - Iran is continuing uranium enrichment as well as building new production lines for the centrifuge machines that carry out the sensitive nuclear work, the United Nations nuclear watchdog said in a report obtained by AFP.

The development dashes hopes that Tehran might be prepared to make an immediate pause in activities that can lead to the development of nuclear weapons.

"On June 6 2006, (Iran) started feeding UF6 (uranium gas) into the 164-machine cascade (line of centrifuges). Iran is continuing its installation work on other 164-machine cascades," said the report from Mohamed ElBaradei, head of the International Atomic Energy Agency (IAEA).

The report said there had in fact been no pause in enrichment since the first batch of uranium was enriched in April, since Iran had carried out testing with two single centrifuges before re-loading the 164-machine centrifuge Tuesday.

Uranium can be enriched to produce nuclear reactor fuel. But if it is enriched to a much greater degree it can be used to manufacture atom bombs. It is enriched by centrifuges arranged in cascades in order to refine the uranium 235 isotope.

The United States charges that Tehran is using its civilian nuclear energy program as a cover for the development of nuclear weapons, an accusation the Iranians have repeatedly denied.

Iran has refused to halt its enrichment work, which it began on April 11.