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Iran faces possible referral to the UN Security Council in early March unless Tehran and the UN atomic agency defy expectations in talks Wednesday and reach a deal on enhanced inspections.
Iran has consistently rejected as unfounded what the International Atomic Energy Agency calls "overall, credible" evidence that until 2003 and possibly since, it conducted nuclear weapons research.
The Vienna agency closely monitors Iran's declared nuclear facilities but wants Iran also to grant access to sites, scientists and documents involved in these alleged military activities.
Iran accuses the IAEA of basing its conclusions on faulty intelligence from foreign spy agencies -- intelligence it complains it has not been allowed to see.
A series of meetings over the past year, the latest in January, have failed to overcome the differences, and "hopes are not high" at agency headquarters for these next talks, one Vienna diplomat told AFP.
"It doesn't seem as if any of the areas of difficulty have been resolved," the envoy said.
The consequences of another failure could be serious.
In November, Washington warned that if there was no progress, it would push for the IAEA board at its next meeting from March 4-8 to take the rare step of referring Iran to the UN Security Council.
"The impression is that (China and Russia) are increasingly frustrated with Iran. It is an open question but there is some optimism" that they will join Western countries in supporting such a procedure, the diplomat said.
This will do little to improve the already frosty ambience in parallel diplomatic efforts between Iran and six world powers, due to resume in Kazakhstan on February 26 after an eight-month hiatus.
Iran has spurned calls from the P5+1 -- the US, China, Russia, Britain, France and Germany -- to scale back parts of its nuclear work because it was not offered sanctions relief in return.
The tone of comments Thursday by Iran's supreme leader Ayatollah Ali Khamenei suggested that Tehran is in no greater mood to compromise, spurning an offer of bilateral talks with Washington.
"You (Americans) want to negotiate when you are pointing the gun at Iran. The Iranian nation will not be intimidated by such actions," the 73-year-old said.
"Some rejoice at the offer of negotiations ... (but) negotiations will not solve anything."
Mark Fitzpatrick at the International Institute for Strategic Studies said he believes Tehran is trying to use greater cooperation with the IAEA as "leverage" in the talks with the six powers.
The Iranians "are not going to strike a deal with the IAEA independent of the other diplomatic talks," the former US State Department official told AFP. "But they shouldn't be linked."
In order to get around the issue of sharing intelligence, the IAEA has pressed Iran to allow its inspectors into the Parchin military base near Tehran, saying its information on activities there can be shared.
But Iran says that the IAEA already visited Parchin twice in 2005 and found nothing untoward. The agency counters that new information obtained since then makes it want to go back.
The IAEA also says that because of activity at Parchin spotted by satellite, including moving "considerable" volumes of earth, its inspections there will be "seriously undermined" if it ever goes.