At stake is whether Iran is producing highly enriched uranium for nuclear weapons, as the United States claims, or whether the traces came along with second-hand equipment bought abroad, as Tehran says.

The traces were found in the first half of August by inspectors from the nuclear watchdog, the International Atomic Energy Agency (IAEA) at the Kalaye Electric Company near Tehran, said the diplomats who asked not to be identified.

The Iranians claim this site is not involved in their nuclear program but was used for storing equipment, they added.

The United States has charged that the Iranians have used Kalaye to test centrifuges used to make highly enriched uranium that can be used to make atomic bombs.

"This news (of traces at Kalaye) is big news perhaps but it didn't lead us any further into having answers," a diplomat said.

The Iranians claim that their nuclear program is peaceful and that traces of highly enriched uranium found earlier this year at a factory to make nuclear fuel and located in Natanz, 250 kilometres (150 miles) south of Tehran, were due to contamination from second-hand components bought abroad and imported into Iran.

It is these components that would have been stored temporarily at Kalaye, allegedly leaving the uranium traces.

Washington asserts that Iran does not need highly enriched uranium for a reactor it is building with Russian help in Bushehr, in southern Iran, since such highly enriched fuel is not needed for civilian programs that produce nuclear energy for electricity.

A Western diplomat close to the IAEA said the new find could support either the US or Iranian side of the story.

The IAEA on September 12 gave Iran until October 31 to clear up questions about its nuclear program, including the origin of the highly enriched uranium.

The IAEA has asked Iran to provide a list of equipment Tehran says it imported from abroad.

The IAEA has also urged Iran to suspend enriching uranium but Iran announced Monday that it had launched a trial run at a uranium enrichment facility in Natanz.

IAEA inspectors are to leave for Iran Sunday and remain there until the October 31 deadline.

IAEA spokesman Mark Gwozdecky said: "We have a senior team of inspectors leaving for Iran on Sunday, which will be the beginning of an extensive program of inspection."

Gwozdecky refused to comment on any results from the inspections at Kalaye.

He would only confirm that "testing at Kalaye was done in the first half of August."

A diplomat explained that the environmental sampling consisted of "swipes" taken at the Kalaye electrical factory, either from "pieces of equipment or walls or floors."

The samples were then sent to a central laboratory in Austria, from where they were farmed out to laboratories around the world for further tests and to "corroborate the results," the diplomat said.

The Iranians had refused for several months to let IAEA inspectors work at Kalaye. When the IAEA inspectors were finally allowed to test there, they "noticed considerable modifications which had taken place," the diplomat said. He did not provide details.

He said "some have alleged that the Iranians tried to sanitize the place, but if it was an attempt to sanitize, then it wasn't successful."

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