LONDON, August 11 (IranMania) - Diplomats at the watchdog UN atomic agency argued in closed-door talks over an EU call for Iran to stop nuclear fuel work, as Tehran raised the sakes by removing seals placed at a key atomic plant.
Removal of the seals, which were placed by the International Atomic Energy Agency (IAEA) inspectors, is a challenge to Western nations worried that the nuclear activities could lead to the production of atomic weapons.
The move at the uranium conversion facility in Isfahan allows the plant to operate at full capacity.
"We have started," Iran's atomic energy agency vice-president Mohammad Saidi told AFP. "It is happening under the supervision of the agency."
In Vienna, the IAEA's board of governors cancelled a planned formal meeting Wednesday, with non-aligned states on the 35-nation body opposing a draft EU resolution calling on Iran to reverse its decision to push ahead with nuclear fuel work, diplomats said.
The board, which began meeting Tuesday, is expected to hold its next session Thursday, IAEA spokesman Peter Rickwood said.
A diplomat close to the IAEA said that non-aligned nations "do not want a resolution on Iran", fearing it could isolate Tehran and cause a backlash.
The non-aligneds, led by Malaysia, prefer the option of a simple statement from the board's chairman. Iran is not on the board but is an IAEA member and non-aligned country.
But, the diplomat said, Western countries, with Russian and Chinese backing, "feel the credibility of the board is at stake because Iran has ignored so many of the board's resolutions," including ones last September and November calling on Iran not to make nuclear fuel, which powers civilian reactors but can also be used to make atom bombs.
The diplomat said EU negotiators Britain, France and Germany, as well as the United States, want to see the resolution adopted this week.
They also want another IAEA board meeting in late August or early September to call for Iran to be referred to the Security Council for possible sanctions if it is still making nuclear fuel.
"Because we are being relatively moderate now (in not calling for Security Council referral), it does not mean the situation has not deteriorated," an EU diplomat said.
Iran on Monday began lifting the suspension of nuclear work it had honored since November in order to get talks with the EU started.
At Isfahan, uranium ore, or yellowcake, is turned into gas, which is then used to make enriched uranium, the final product of which is fuel for nuclear power plants or, in highly refined form, the explosive core of atom bombs.
"They have crossed the Rubicon and now they are continuing," the EU diplomat said about the Iranian fuel work.
However, the IAEA is "treading water" in its response, the diplomat said, and Iran is not actually enriching uranium.
The diplomat said that after the first step Iran had taken Monday, "the world gets used to that kind of thing, especially since the Iranians won't touch enrichment work for the time being."
Iranian President Mahmood Ahmadinejad described as "an insult" an EU offer to Iran, after nine months of talks, of trade and other incentives in return for guarantees Iran is not making nuclear weapons.
But he has told UN chief Kofi Annan that he was ready to continue talks and to make some propositions, according to Iran's student agency ISNA.
In Vienna, Iranian negotiator Cyrus Nasseri said Tehran was frustrated that the EU was still not acknowledging Iran's right under the Non Proliferation Treaty (NPT) to make nuclear fuel as part of a peaceful energy program.
He said Iran "can negotiate with the Europeans on the basis of our proposal" in March and which outlines a step-by-step approach for Iran to resume nuclear fuel work, including enrichment.
The draft EU proposal urges Iran to comply with previous resolutions by re-establishing "full suspension of all enrichment-related activities including the production of feed material, including through tests or production at the Uranium Conversion Facility," according to a copy obtained by AFP.
It also calls for seals to be replaced if they are removed.
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