Technical woes slow Iran atom fuel drive - diplomats

VIENNA, July 11 (Reuters) Technical glitches appear to have slowed down Iran's nuclear fuel-enrichment programme and put on hold plans to expand it, diplomats said today.

Iran, meanwhile, held talks with the European Union on an offer of incentives to stop it from enriching uranium and defuse a crisis over suspicions that Tehran's professed civilian nuclear energy drive is a camouflaged atom bomb project. Tuesday's talks ended with no clear sign of a result.

In April, Iran enriched raw uranium to the level needed to fuel nuclear power plants for the first time, but far short of the threshold suitable for a warhead. It began a second round of feeding uranium into centrifuge enrichment machines on June 6.

But since then, some Western diplomats in Vienna accredited to the U N nuclear watchdog agency said technical problems had apparently beset Iran's cascade of 164 enriched interconnected centrifuges at its Natanz pilot plant, impeding production.

''We have been told of problems from people in a position to know. It's a slowdown in the process although we haven't been able to quantify it yet,'' said one diplomat, who like others asked for anonymity due to the topic's political sensitivity.

''We have heard ... that plans for a second and third cascade of 164 are on hold and that the attrition rate in the first cascade is relatively high,'' another diplomat told Reuters.

The first diplomat said unconfirmed reports were circulating that the first cascade, basis for Iranian plans to install 3,000 centrifuges by 2007, had a ''failure rate of up to 50 percent''.

He said the centrifuges seemed to be showing fragility after being spun at supersonic speeds for most of the past few months, and the nature of materials injected into them -- which could involve impurities in the uranium -- could be damaging too.

''The reasons for the delays are definitely not political, that is, it's not like it's an Iranian goodwill signal as they go into negotiations with the EU,'' he said.

Mark Fitzpatrick, analyst with the International Institute for Strategic Studies in London, also said Iran's enrichment programme had bogged down, quoting reliable diplomatic sources.

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