Iran to settle IAEA issues in phases-dips

VIENNA, Aug 24 (Reuters) Iran will resolve UN questions about suspicious aspects of its nuclear programme in phases by year-end but this will not be enough for a declaration that its activity is wholly peaceful, diplomats said today.

They disclosed broad aspects of a plan Iran agreed this week with the International Atomic Energy Agency meant to clear up IAEA inquiries into indications of illicit military involvement in Iran's declared drive for peaceful nuclear energy.

Another goal is to cement regular and effective access for IAEA inspectors to Iran's underground uranium enrichment plant where it plans industrial-scale production of nuclear fuel.

Spurred by suspicions Iran is covertly trying to master the means to make atom bombs, the UN Security Council has slapped limited sanctions on Tehran over its refusal to stop enrichment. Washington is seeking wider sanctions but these may depend on how Iran's new transparency commitment to the IAEA pans out.

Diplomats said ahead of the plan's circulation to the IAEA's 35-nation board next week that it required Iran to answer questions in sequences -- ''easier'' ones first graduating to more difficult ones, with the process finished by December.

One diplomat said the IAEA had sought swifter, broader action by Iran to avoid fraying the patience of sceptical Western powers and raise pressure for more sanctions. ''But Iran was adamant on sequencing, settling issues one by one.

''The concern is that they will score early political wins by resolving the easier stuff, then wriggle out of coming clean on more sensitive issues by blaming more Security Council action, or even talks to take action,'' the diplomat said.

''The IAEA may then have to ask (big powers) for more time.'' Western diplomats assessing the transparency plan said Iran might only be trying to keep the Security Council at bay while it kept enriching uranium to perfect the fuel-production cycle.

The first batch of issues included Iran's experiments with plutonium, the commonest fissile element in nuclear warheads; re-establishing inspector access to the Arak heavy-water reactor under construction; and a legally binding accord governing inspections at the expanding Natanz enrichment complex.

ADVANCED CENTRIFUGES The second phase in the process would lift the veil on Iran's efforts to build P-2 centrifuges, able to refine uranium two to three times as fast as the antiquated P-1 model now being used.

Iran obtained centrifuge parts from the former nuclear black market network of Pakistan's AQ Khan, diplomats say.

Diplomats said the third phase would address the kernel of suspicions about a shadowy military character to the programme.

These issues include the surfacing of a document describing how to machine uranium metal into ''hemisphere'' shapes suitable for the core of bombs, and particles of weapons-quality uranium on equipment sampled by inspectors.

Also in question here is Western intelligence about secret, administrative links between uranium processing, high explosives tests and a missile warhead design.

One diplomat said Iran agreed for the first time to look at evidence of the link, earlier rejected as ''fabrications''.

In talks on the plan, Iran sought a clause stipulating that if key issues were settled, the IAEA would certify that there were no undeclared nuclear activities or materials in Iran, meaning the programme was wholly peaceful, diplomats said.

But the IAEA refused, they said, ruling out such a declaration before Iran restored wider-ranging inspections of sites not declared to be nuclear under an Additional Protocol.

Tehran stopped observing the Additional Protocol last year in retaliation for sanctions steps, handicapping inspectors.

''The IAEA feels that without the AP in force, they would not be able to give Iran as a whole a clean bill of health,'' said a diplomat accredited to the agency.

The first phase of questions are to be resolved from now through the month of September, the second in October and November, and the third by the end of the year, diplomats said.

The United States has said the plan has ''real limitations'' for having omitted an Iranian return to the Additional Protocol and being subject to no tougher sanctions, which US officials vowed to pursue nevertheless.

''The plan's subtext is a link between Iranian cooperation and no further Security Council action, but it's not stated there,'' said a senior Vienna diplomat familiar with the issue.

REUTERS GT BD2219