ElBaradei Says Iran Atom Deal Possible

Mark Heinrich and Parisa Hafezi, Reuters:

The International Atomic Energy Agency chief said on Monday a deal to defuse a standoff over Iran's nuclear aims was still feasible and diplomats outlined a compromise that would let Tehran pursue limited atomic research. Mohamed ElBaradei cited a surge of diplomacy in which Iran has offered not to pursue industrial-scale uranium enrichment for up to two years.

He was speaking before debate on Iran at an IAEA board meeting that could presage U.N. Security Council action.

Iran may agree to extend that moratorium if it is permitted to run a small-scale enrichment research programme, said a diplomat close to talks between Iran and the European Union.

Iran's insistence on doing enrichment research has been a red line for the West, eager to ensure Tehran does not acquire technology that can be used for atom bombs. The Islamic Republic says it seeks only nuclear-generated electricity, not weapons.

"I am still very much hopeful that in the next week or so an agreement could be reached," ElBaradei said, while acknowledging that Russia's proposal to enrich uranium for Iran had snagged on Tehran's determination to purify nuclear fuel itself.

Javad Vaeedi, deputy secretary of Iran's national security council, highlighted that obstacle when he told Reuters that enrichment "research and development" in Iran was irreversible.

"Iran is ready to compromise on the period of suspension (of large-scale enrichment) if it can keep its nuclear research activities," the diplomat close to the Iran-EU talks said.

SMALL-SCALE ENRICHMENT

On Friday, Iran said it could delay industrial-scale enrichment for up to two years, but the EU countered with a demand for a 10-year moratorium on all enrichment activity.

"The (IAEA) board of governors, EU3 and Russia have made clear that there needs to be a suspension of these enrichment capabilities and ... a prolonged period of time necessary to restore confidence. Two years is not a prolonged period of time," a U.S. State Department official said. READ MORE

A senior official close to the IAEA, who asked not be named, said trying to distinguish between research work and productive enrichment was like "trying to draw a line in water".

However, EU diplomats said Russia and ElBaradei are pushing the West to let Iran continue small-scale enrichment research under IAEA surveillance as a face-saving solution.

The Security Council could desist from any action for the time being if the proposal won agreement, one diplomat said.

Of the three leading European powers, Germany is the one that "could most live with a pilot enrichment plant in Iran," said a European diplomat close to the talks with Iran.

But he said Germany would not break ranks with its EU partners France and Britain over the issue.

"We are not in the Security Council, unlike Britain or France. So one should not over-estimate Germany's position. Paris and London seem to be much more sceptical," said another EU3 diplomat, speaking on condition of anonymity.

Aliasghar Soltanieh, Iran's envoy to the IAEA, told Reuters there was a good chance of agreement with EU powers and Russia.

In defying calls to suspend all enrichment-related work, Iran seems to be counting on divisions in the Security Council over whether to resort to sanctions mooted by the United States.

Wielding vetoes in the council, Russia and China could block sanctions that would disrupt their trade ties to Iran.

Iran's past secrecy over its nuclear programme, its failure to satisfy IAEA inspectors and its public calls for Israel's destruction have stoked Western suspicions about its intentions.

HARDLINERS

ElBaradei believes U.N. intervention could close diplomatic avenues and bolster Iranian hardliners, diplomats say. Tehran has warned it could bolt a nuclear safeguards treaty if pushed.

"Confrontation (between the West and Iran) could be counterproductive and would not (give) us a durable solution," said ElBaradei, calling for verbal restraint on all sides.

"There is universal recognition that the Iran issue has serious implications for international security. Everyone understands that escalation is not going to help a situation that is highly, highly volatile in the Middle East," he said.

The IAEA's 35-member board reported Iran to the Security Council a month ago. It urged Iran to heed resolutions to halt uranium enrichment work and stop stonewalling IAEA inquiries.

On Tuesday the IAEA board will consider ElBaradei's latest report before it is sent to the council, which might eventually consider sanctions if diplomacy fails.

Tehran has complained of double standards -- India, Israel and Pakistan enjoy good ties with the West although they built atom bombs in secret -- and President Mahmoud Ahmadinejad warned of unspecified consequences if Tehran faces a U.N. crackdown.

ElBaradei's report said Iran plans to begin installing 3,000 centrifuges this year. Iran denies this implies industrial scale fuel production, an assertion the West says is not credible.

Around 1,500 centrifuges running optimally for a year could yield enough highly-enriched uranium for a bomb, experts say.

The Security Council's first step would probably be to urge Iran to heed IAEA resolutions. It might also consider endowing the IAEA with more intrusive, short-notice inspection powers.

Enacting sanctions will be much harder given international reluctance to isolate the world's fourth biggest oil exporter.

(Additional reporting by Francois Murphy in Vienna, Noah Barkin in Berlin and Tehran bureau)