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Last Updated: Thursday, 8 June 2006, 18:09 GMT 19:09 UK
Iran 'continuing enrichment work'
Iranian nuclear facility
Iran insists its nuclear programme is solely for the generation of power
Iran slowed uranium enrichment in May but picked up the pace on the day it got an offer to abandon the work, a report by the UN nuclear agency shows.

The report by the International Atomic Energy Agency says Iran was installing more centrifuge enrichment machines.

It also says new traces of highly enriched uranium have been found.

EU foreign policy chief Javier Solana said, meanwhile, he was "more optimistic than pessimistic" about reaching a deal with Iran.

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From Western diplomatic sources

In the confidential report, a copy of which was obtained by the BBC, the IAEA says Iran has continued its sensitive uranium enrichment work over the past few weeks.

During May the work was at a slower pace but on Tuesday Iranian scientists at the enrichment plant in Natanz picked up speed, it says.

In a separate development, the report says a small number of particles of highly enriched uranium had been found on equipment at a technical university in Iran.

It says Tehran told the IAEA the equipment had not been used for nuclear activities and that an investigation is under way.

Low enriched uranium can be used for atomic power plants. At a higher level of enrichment, it can be used for nuclear bombs.

The report is due to be discussed by the IAEA's 35-nation board of governors next week in Vienna.

Ahmadinejad stands firm

The international community is awaiting Tehran's response to the package of incentives offered by the world's six major power submitted by Mr Solana to Iranian officials on Tuesday.

The deal from the five permanent UN Security Council members and Germany offers incentives if Tehran suspends uranium enrichment.

Iranian President Mahmoud Ahmadinejad said on Thursday Tehran was ready to discuss "common concerns" about its nuclear programme but pledged not to negotiate what technology to use.

"The Iranian nation will never hold negotiations about its definite rights," he said.

Mr Ahmadinejad did not say if Iran accepted the proposal handed over by Mr Solana.

Western nations fear Iran is enriching uranium to make nuclear weapons, while Tehran says its nuclear programme is for peaceful energy purposes.

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