Iran has given an initial response to a plan that calls for Tehran to ship most of its enriched uranium abroad, the International Atomic Energy Agency has confirmed.
An official familiar with Iran's response said Tehran was unwilling to accept the deal, which would delay Tehran's ability to make a nuclear weapon.
The US and allied countries were seeking Iranian agreement to ship out 70 per cent of its low-enriched uranium to Russia in one shipment for further enrichment and conversion into fuel for a Tehran research reactor.
Sending that amount in one batch would not leave Tehran with enough material to make weapons-grade uranium should it decide to make a warhead.
Experts say Iran would need at least a year to produce enough to make up for the exported material, giving the international community a window in its efforts to persuade the Islamic Republic to freeze its enrichment program.
But a Western diplomat familiar with the Iran offer said Tehran was instead proposing to enrich the material domestically under supervision of the International Atomic Energy Agency.
The Tehran research reactor needs fuel enriched to just under 20 per cent - far from the 90 per cent and above needed to make the fissile core of a nuclear weapon. Iran's stockpile is low-enriched uranium enriched to around 3 per cent, suitable only for nuclear fuel.
But the higher the level of enrichment, the easier it is to reach weapons-grade level. Such a proposal outlined by the diplomat is unlikely to be endorsed by the US and its allies, which would see it as bringing Tehran closer to nuclear weapons capacity instead of reducing such a threat.
"They don't want the LEU taken out," said the diplomat, referring to low-enriched uranium. "They want to enrich it there (in Iran) under IAEA supervision."
Iran has signaled in recent days that it was unwilling to give up most of its enriched stockpile in a single shipment and would seek to re-negotiate terms worked out by IAEA chief Mohamed ElBaradei in talks last week with Iran, Russia, France and the US. That Iranian stance was reinforced by the language of the IAEA statement.
Besides speaking of "an initial response from the Iranian authorities" - suggesting that Iran was looking for further talks - the statement indicated the possible need for further negotiations. It said ElBaradei expressed "hope that agreement can be reached soon" and was consulting with the four nations involved.
The plan would commit Iran to turn over more than 2,600 pounds of low-enriched uranium - more than the commonly accepted amount of low-enriched uranium needed to produce weapons-grade uranium. The West says Tehran agreed in principle to export that amount in one shipment during October 1st talks in Geneva with the US and five other world powers - something Iranian officials have denied.
In Iran today, President Mahmoud Ahmadinejad said that his country will not give up its nuclear program although the West and Iran are now co-operating on the issue - remarks that signaled a divide between the Islamic Republic and the West on what Iran needed to do to comply with the outlines of the enrichment plan.
Ahmadinejad said the West has moved "from confrontation to interaction" with Iran over its uranium enrichment program, which he called an "inalienable right of the Iranian nation."
"Today we reached a very important point," Ahmadinejad said, speaking at a rally in the northeastern city of Mashhad. "Ground has been paved for nuclear cooperation" and Tehran is ready to now work on nuclear fuel supplies and technical know-how with the UN nuclear watchdog, Ahmadinejad added.
But he insisted his government "will not retreat even an iota" over the nation's right to pursue a nuclear program - which the West fears masks nuclear arms ambitions.
AP