By Fredrik Dahl
VIENNA (Reuters) - Iran has told the U.N. nuclear agency that it will deploy more modern machines to refine uranium, a defiant move that may further complicate diplomatic efforts to resolve the dispute over Tehran's atomic activities peacefully.
The Islamic Republic said in a letter to the International Atomic Energy Agency that it will use the new centrifuges at its main enrichment plant near the central town of Natanz, according to an IAEA communication to member states seen by Reuters.
Such a step could enable Iran to enrich uranium much faster than it can at the moment and increase concerns in the West and Israel about Tehran's nuclear program, which they fear has military links. Iran says its work is entirely peaceful.
It was not clear how many of the new centrifuges Iran planned to install at Natanz, which is designed for tens of thousands of machines. Analysts say sanctions may have limited Iran's access to spare parts needed to produce sophisticated enrichment centrifuges in larger numbers.
Enriched uranium can fuel nuclear power plants, Iran's stated aim, or provide material for bombs if processed much further, which the West suspects is Tehran's ultimate goal.
Iran's announcement to the Vienna-based IAEA coincides with wrangling between Tehran and six world powers over when and where to meet next, delaying a resumption of talks aimed at reaching a negotiated deal and avert a new Middle East war.
The powers - the United States, France, Germany, Britain, Russia and China - want Iran to curb its enrichment program, work which can have both civilian and military applications.
The United States and its Western allies have sharply ratcheted up the sanctions pressure on Iran over the past year, targeting its lifeline oil sector. This is increasingly hurting Iran's economy but the clerical leadership is showing no sign of backing down.
Israel, believed to be the Middle East's only nuclear-armed state, has hinted at possible military action against Iran if sanctions and diplomacy fail to resolve the nuclear stand-off.
Iran says it is its right to enrich uranium for peaceful purpose and has repeatedly refused to halt the work, a position highlighted by its letter dated January 23 to the IAEA about its centrifuge plans.
Such machines spin at supersonic speed to increase the ratio of the fissile isotope. Iran has for years been trying to develop centrifuges that are more efficient than the breakdown-prone 1970s IR-1 model it now has.
Iran said it would use the new centrifuge model at a unit in Natanz where Iran is refining uranium to a fissile concentration of up to five percent, according to the IAEA letter.
The IAEA "received a letter from the Atomic Energy Organization of Iran (AEOI) dated 23 January 2013 informing the Agency that 'centrifuge machines type IR2m will be used in Unit A-22' at the Fuel Enrichment Plant (FEP) at Natanz," it said.
The IAEA said it had asked Iran, in a letter dated January 29, to provide technical and other information about the plans. A unit can house more than 3,000 centrifuges.
The U.N. agency, whose mission it is to prevent the spread of nuclear weapons in the world, regularly inspects Natanz and other Iranian nuclear sites.
Nuclear expert Mark Fitzpatrick, of the International Institute for Strategic Studies think-tank, said that employing the new centrifuges at Natanz could be "a most unfortunate game changer," depending on the numbers.
"If Iran introduces them in a large scale, the timeline for being able to produce fissile material for nuclear material would be significantly reduced," Fitzpatrick said.
Iran says it refines uranium to power a planned network of nuclear power stations. But the West fears that the material, if enriched much further to 90 percent, could be used for weapons.
The part of Iran's enrichment work that most worries the West - to a fissile concentration of 20 percent - is carried out at the Fordow underground facility near the town of Qom.
This higher level of enrichment represents a significant step towards the fissile concentration that would be needed in any attempt to build atomic bombs. Iran says it needs 20 percent uranium to fuel a medical research reactor in Tehran.
Fordow "has increasingly been the focus of concern about Iran's capability, but a technological breakthrough at the much bigger Natanz plant might be still more provocative," said nuclear expert Mark Hibbs of the Carnegie Endowment think-tank.
(Editing by Jon Boyle)
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