VIENNA, Aug 30: Iran’s decision to answer key questions about its nuclear programme is “a significant step forward,” the UN nuclear agency said on Thursday, reporting on a development expected to help Tehran avoid new sanctions.

The report by the International Atomic Energy Agency (IAEA) said Iran continued to defy two UN Security Council resolutions to cease enriching uranium, but added that the enrichment work had slowed.

It said Iran was still short of its planned 3,000 centrifuges for producing enriched uranium which can be used as nuclear reactor fuel but also atom bomb material.

“The work plan is a significant step forward,” the IAEA said, referring to an agreement under which Iran has agreed to a timetable for clearing up outstanding issues related to its nuclear programme.

But it added that “once Iran’s past nuclear programme has been clarified, Iran would need to continue to build confidence about the scope and nature of its present and future nuclear programme.”

The IAEA’s 35-nation board of governors will review the report at a meeting beginning Sept 10.

Iran has cleared up questions about its experiments with plutonium, another potential atom bomb material, said the IAEA report, which included the timetable Iran and the agency agreed on last week to resolve outstanding issues.

The plutonium issue is one of several over which the UN Security Council imposed sanctions to get Iran to cooperate with the IAEA, which is investigating US charges that Tehran is covertly developing nuclear weapons.

“What we have is what we think is an important step,” IAEA deputy director general Ollie Heinonen, who negotiated the timetable, told reporters.

He said the goal was to have the agency’s questions about Iran’s past hidden activities answered enough to close the matter by the end of the year.

“This is not an open-ended timeline,” said Heinonen, who is chief inspector for the IAEA as head of its safeguards division.

He said it was the “first time” Iran had agreed to review documents that the United States says show Iran carrying out secret military work on uranium processing, high-explosives testing and putting a nuclear warhead on a missile re-entry vehicle.“What Iran is facing is actually the litmus test, the test that it can provide in a timely manner answers to the IAEA questions and the supporting information that has been lacking,” Heinonen said.

“If the answers (from Iran) are not satisfactory, we are making new questions until we are satisfied with the answers and we can conclude technically that the matter is resolved,” Heinonen said.

A senior UN official, who asked not to be named, said: “If something pops up next Christmas, then that’s a new issue” that the IAEA can ask about.

Beyond this, Iran must adopt the IAEA’s additional protocol for wider inspections aimed at verifying the scope and nature of its nuclear programme, including advanced centrifuge research.

Iran’s uranium enrichment levels at its plant in Natanz were measured at 3.7 per cent, well within the maximum five percent needed for fuel needs, while weapons require over 90 per cent enrichment.

The report said that “as of 19 August 2007, twelve 164-machine (centrifuge) cascades were operating simultaneously” in Natanz to enrich uranium, a total of 1,968 centrifuges.

A total of 656 more centrifuges are in development — one 164-machine cascade running without feedstock uranium gas, one being tested and two more under construction, the report said.—AFP