VIENNA, Feb 14 (Reuters) - U.N. nuclear inspectors have seen a small number of advanced centrifuges at an uranium enrichment plant where Iran has said it will install and operate them, a diplomatic source said on Thursday.
On Wednesday, Iran's atomic energy chief said it had started installing a new generation of machines for refining uranium at the Natanz plant, an announcement likely to annoy the West and complicate efforts to resolve a dispute over its nuclear work.
The diplomatic source, who declined to be identified, suggested the centrifuges were positioned for installation at the Natanz facility. The International Atomic Energy Agency (IAEA) regularly visits Iranian nuclear sites, including Natanz.
Iran had already told the IAEA that it planned to introduce new, so-called IR2-m centrifuges to its main enrichment plant near the central town of Natanz - a step that could significantly speed up its accumulation of material that the West fears could be used to develop a nuclear weapon.
Enriched uranium can fuel nuclear power plants, Iran's stated aim, or, if refined to a high degree, provide material for bombs, which the West suspects is Tehran's real purpose - something Iran strenuously denies.
If deployed successfully, new-generation centrifuges could refine uranium several times faster than the model Iran now has.
It was not clear how many of the new centrifuges Iran aimed to install at Natanz, which is designed for tens of thousands; an IAEA note to member states on Jan. 31 implied that it could be up to 3,000 or so.
Iran's atomic energy chief, Fereydoun Abbasi-Davani, said on Wednesday the new machines were specifically geared for lower-grade enrichment of uranium to below 5 percent purity.
Iran has been refining some uranium up to a concentration of 20 percent fissile material, only a short technical step from weapons grade of 90 percent.
It is this stockpile that has prompted Israel and the United States to warn that they will do whatever is necessary to prevent Iran being able to build a nuclear warhead. (Reporting by Fredrik Dahl; Editing by Mark Heinrich)