"We're not far," said one diplomat at the International Atomic Energy Agency, who pointed out that changes in the British-French-German text had to go back for approval to delegations' national capitals from the 35-nation IAEA board of governors and that this took time.

Iranian President Mohammad Khatami had warned earlier that Tehran could back away from key commitments if the IAEA took a hardline stand over its nuclear programme, which Tehran says is solely for generating electric power.

The diplomat said the Iranian threats had not affected work on the text, which has been relatively unchanged after being rewritten Monday to take into account strong comments by IAEA chief Mohamed ElBaradei that Iranian cooperation has been "less than satisfactory" and that Tehran must do more so the investigation can be wrapped up in a few months.

A revised text Wednesday did soften a key demand slightly by asking Iran "voluntarily to reconsider" instead of just "to reconsider" its decisions to "begin production testing at the Uranium Conversion Facility and to start construction of a research reactor moderated by heavy water," two key parts of the nuclear fuel cycle.

But Iranian delegation chief Seyed Hossein Mussavian, a top member of Iran Supreme National Security Council, had earlier told AFP this clause should be dropped entirely as the IAEA's call for Iran to back off from uranium conversion was completely unacceptable.

Uranium enriched to high levels by centrifuges can be nuclear fuel but also the explosive for atom bombs.

Khatami said Iran would feel "no moral obligation" to keep honoring its suspension of uranium enrichment, or to allow tougher IAEA inspections, if the agency criticizes Iran, which has worked with the IAEA since inspections began in February 2003.

In Vienna, the US ambassador to the IAEA, Kenneth Brill, described the threats as intimidation and said they suggested Iran has something to hide.

"People who are trying to produce electricity (for peaceful uses as Iran claims) don't engage in these kinds of behavior," Brill said, referring to Iran's efforts to develop advanced P-2 centrifuges capable of making bomb-grade uranium.

Another Western diplomat said the Iranians were "trying to gain time by making what should be technical evaluations into political ones."

Khatami did offer some reassurance by ruling out quitting the nuclear Non-Proliferation Treaty (NPT) mandating IAEA verification of atomic activities worldwide.

"But if the European resolution is adopted in its current form, that means the Europeans do not respect their obligations to us and we will not have any obligations to them," he said.

The working draft has widespread support among Western nations and even non-aligned countries, although some of these side with Iran in calling for the text to be softened, with more agreement at this board meeting than past ones, diplomats said, noting a shared sense of urgency over the Iranian program.

The United States, which claims that Iran is secretly developing nuclear weapons, wants the IAEA to send the Iranian dossier to the UN Security Council for possible sanctions against the Islamic republic but lacks support for the bid on the agency's board.

The so-called Euro-3 of Britain, France and Germany have since October 2003 been seeking better cooperation from Iran.

Mussavian said Iranians believe the Euro-3 "have not met Iranian expectations" that the IAEA investigation would be brought to an end by June and that Iran would "enjoy the rights of cooperation with other members, to receive peaceful nuclear technology."

But ElBaradei said in Vienna on Monday there were two major outstanding issues -- contamination of some equipment by highly enriched uranium (HEU) and Iranian research into P-2 centrifuges.

ElBaradei said "information provided by Iran with regard to the P-2 centrifuge program, after repeated requests, has been changing and at times contradictory."

All rights reserved. Copyright 2003 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse.

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