VIENNA, July 28: Iranian agents are negotiating with a Russian company to buy a substance that can boost nuclear explosions in atomic weapons, according to an intelligence agency report being circulated by diplomats.

But the Russian government, which monitors nuclear-related exports closely, denied any Russian companies were planning to supply Iran with the substance, known as deuterium gas.

The two-page report cited "knowledgeable Russian sources" for the information, which Washington will likely point to as more proof that Tehran wants to acquire nuclear weaponry.

"Iranian middlemen ... are in the advanced stages of negotiations in Russia to buy deuterium gas," the report said. Iran denies wanting atomic arms and says its nuclear programme is for peaceful purposes. Deuterium is used as a tracer molecule in medicine and biochemistry and is used in heavy water reactors of the type Iran is building.

But it can also be combined with tritium and used as a "booster" in nuclear fusion bombs of the implosion type. It is not illegal for Iran to purchase deuterium but it should be reported to the IAEA.

Diplomats say the suspicions surrounding Iran's nuclear programme are so great that it would be wise for Tehran to exercise maximum transparency on all such "dual-use" purchases and declare them ahead of time to the UN nuclear watchdog.

"Iran has not declared this to the IAEA. Their cover story is that they want it for civilian purposes," said the diplomat who gave the report. The report, which did not name the Russian firm, said purchase talks were in the final stages. It added that Iran had tried to produce deuterium-tritium gas - with the help of Russian scientists - but had so far failed.

Moscow has been criticized by Washington for building the Bush her nuclear power plant in Iran, despite US concerns that it is a cover for Tehran to acquire know how and import items that can be used for bombs.

Reacting to the report, the Russian foreign ministry issued a statement saying that in its nuclear cooperation with Iran, Moscow strictly sticks to intergovernmental agreements which do not provide for supplies of the deuterium gas. -Reuters