Iran says it's willing to continue nuclear talks

VIENNA -- Iran's president said yesterday that he will submit new proposals in negotiations over his country's nuclear program but denounced a European offer of aid as an ''insult," as the UN nuclear agency tried to resolve the crisis without referring Tehran to the Security Council.

While the International Atomic Energy Agency's 35-nation board considered a new warning to a defiant Iran to suspend its atomic activities, fresh areas of concern emerged yesterday.

An exiled dissident said Iran recently produced 4,000 centrifuges capable of enriching uranium to weapons grade. Alireza Jafarzadeh, who helped uncover details of Iran's program in 2002 that fueled US suspicions that the country was trying to build a nuclear bomb, said the centrifuges are ready to be installed at the nuclear facility in Natanz.

In Tehran, Iran announced it has improved the range and accuracy of its Shahab-3 missile. It said the weapon can strike targets up to 1,200 miles away nearly dead-on -- a statement sure to unnerve Western officials who fear the regime one day will be able to fit such missiles with nuclear warheads.

Mahmoud Ahmadinejad, the country's new president, spoke yesterday with UN Secretary General Kofi Annan and said Iran was willing to continue the negotiations with the Europeans.

''We are ready to proceed with talks. Of course, I will put forward initiatives in this respect after forming my Cabinet," Ahmadinejad told Annan.

But Ahmadinejad is bringing in one of the most hard-line elements in the Islamic regime to head the talks -- another sign Iran has grown more willing to defy the West in pursuing its nuclear program since he was elected president in June.

President Bush welcomed Ahmadinejad's willingness to continue negotiations but said he was ''deeply suspicious" of Iran.

''Iranians are getting a message, that it's not just the United States that's worried about their nuclear programs, but the Europeans are serious in calling the Iranians to account and negotiating," he said.

Bush said that if Iran does not cooperate, UN sanctions are ''a potential consequence."

However, diplomats said there was little stomach for reporting Tehran to the Security Council, in part out of fears that such a move -- the International Atomic Energy Agency's last resort -- might inflame support within Iran for the regime's nuclear ambitions and scuttle any chances at winning the country over with economic incentives.

Envoys from some nations whose own nuclear activities have come under scrutiny, such as Brazil and Argentina, also appeared reluctant to subject Iran to measures that could be applied to their programs one day.

An atomic agency draft resolution crafted by Britain, France, and Germany does not mention the Security Council.

The text, which could be altered during negotiations, says ''the agency is not yet in a position to conclude that there are no undeclared materials or activities in Iran." It urges Iran to cooperate by ''re-establishing full suspension of all enrichment-related activities."

Jafarzadeh, the Iranian dissident who spoke by telephone from Washington, where he runs the think tank Strategic Policy Consulting, said his information on the centrifuges came from sources within the Tehran regime who have proven accurate in the past.

The agency was taking the allegation ''seriously" and would investigate ''should we find anything credible contained within it," spokeswoman Melissa Fleming said.

The agency previously said it was aware of 164 centrifuges at Natanz, 300 miles south of Tehran.

Ali Hafezi, a spokesman for Iran's Atomic Energy Organization, said yesterday that Tehran last year gave the International Atomic Energy Agency a full disclosure of its nuclear program, including the number of centrifuges.

Iran had agreed with the agency to stop building centrifuges, some of which can be used to enrich uranium to levels high enough to fuel a nuclear weapon, but last year announced it had resumed centrifuge construction.

Centrifuges also can be used to produce fuel for nuclear power plants, which Iran insists is its only intention. The United States contends it is running a covert effort to make nuclear weapons.

Iran on Saturday rejected a package of EU economic and political incentives presented by envoys from Britain, France, and Germany, and this week it resumed some uranium conversion activities at its nuclear facility at Isfahan.

Yesterday, Ahmadinejad told Annan the European proposals were an ''insult" to Iran.

Sirus Nasseri, Iran's top delegate to the atomic energy agency, said Iranian officials would break agency seals at Isfahan today and start additional conversion activities. An agency surveillance system would be functioning by then, he added.

The atomic energy agency's board of governors was expected to issue a resolution by tomorrow urging Tehran to suspend its nuclear activities.

Agency chief Mohamed ElBaradei said he hoped the standoff was ''simply a hiccup in the process and not a permanent rupture."

''We have made a very good progress in the last couple of years with regard to clarifying Iran's past nuclear activities," he said. ''The important thing is to go back to the negotiating process and avoid any escalation of the situation."