Key Tehran talks start amid row over Iran atom goals

TEHRAN, Oct 30 (Reuters) Iran began a crucial round of talks with the International Atomic Energy Agency to clarify its nuclear activity amid disagreement between the IAEA chief and the West over judging Tehran's intentions.

IAEA Director Mohamed ElBaradei said on Sunday there was still no evidence Iran was trying to make atom bombs rather than generate more electricity as it says. France and the United States said yesterday all signs pointed to a weapons agenda.

After stonewalling the IAEA for years, Iran pledged to the UN nuclear watchdog in August to answer questions about past secret aspects of its programme before the end of 2007 in hopes of warding off a third, harsher batch of UN sanctions.

The IAEA has withheld comment on whether Iran, in a series of talks since August, has been resolving transparency issues one by one as promised. An IAEA report is due in mid-November.

Iranian news agencies quoted a senior IAEA official as saying cooperation was ''good'', without spelling it out.

''We have done many things, but much work remains and I hope we can do that,'' the official Islamic Republic News Agency (IRNA) quoted IAEA deputy director Olli Heinonen as saying at Tehran airport before talks got under way.

Mohammad Saeedi of Iran's Atomic Energy Organisation voiced hope negotiators could resolve questions about its development of centrifuges used to enrich uranium in the talks -- the third and last session scheduled to deal with the subject.

Iran uses a breakdown-prone 1970s vintage of centrifuge, called the ''P-1''. It is researching an advanced P-2 model able to refine uranium much faster, using less energy, at sites off limits to IAEA inspectors.

The talks were expected to run through Wednesday.

The IAEA says answers to the questions would help it judge whether Iran's activity is wholly peaceful or not. Among questions yet to be addressed are alleged experiments linking uranium processing and missile warhead designs.

ElBaradei, speaking at the United Nations on Monday, said Iran's agreement to hold the talks was ''an important step in the right direction'', but that Tehran's full cooperation was key.

However US Ambassador to the United Nations Zalmay Khalilzad said there was no sign Iran would suspend enrichment as demanded by the UN Security Council and so Washington was drafting new UN sanctions to increase pressure on Tehran.

ELBARADEI DRAWS US, FRENCH CRITICISM The United States and France took issue with ElBaradei's remark on Sunday that the IAEA had found no proof Iran was building bombs and remained years away from such capability.

France said Iran's curbs on IAEA inspections made no sense if its programme was geared only for civilian energy.

Washington said Iran's efforts to enrich uranium for nuclear fuel itself, rather than import refined uranium more cheaply, indicated it really wanted nuclear weapons.

''This is a country that is enriching and reprocessing uranium, and the reason that one does that is to lead towards a nuclear weapon,'' White House spokeswoman Dana Perino said.

French Defence Minister Herve Morin told reporters in Abu Dhabi that France's information ''backed up by other countries'' was contrary to ElBaradei's comments. Morin did not elaborate on what information France had.

''If ... ElBaradei is right then there is no reason that Iran stops ElBaradei and the IAEA from carrying out inspections.'' IAEA inspectors say they have regular access to declared Iranian nuclear sites. But in retaliation for limited sanctions, Iran last year stopped wider-ranging checks that would help inspectors ascertain no undeclared activity is going on.

Washington also dismissed ElBaradei's call to ''stop spinning and hyping the Iran issue'' -- an allusion to US talk of a last-resort war on Iran, suggesting this was not the business of of the IAEA chief. ''I think we can handle the diplomacy on this one,'' State Department spokesman Sean MacCormack told reporters.

Iran rejects Western accusations of a covert quest for nuclear bombs. Ex-chief nuclear negotiator Ali Larijani, who remains an influential figure, has said new bilateral US sanctions could make Tehran rethink its relations with the IAEA.

If ElBaradei reports next month Iran has not sufficiently resolved outstanding issues, Western powers say they will move to have the Council adopt more far-reaching sanctions.

A senior Iranian commander said the ''martyrdom-seeking'' Basij militia would be able to disrupt oil shipping routes in the strategic Gulf if the need arose, an apparent suggestion that suicide attacks might be a response to any US strike.

REUTERS BJR PM0425