"The prime minister signed the decision on the nomination of Sergei Kiriyenko" to head the agency, Rosatom, the Interfax news agency quoted government spokesman Sergei Naryshkin as saying.

The appointment is part of a reshuffle of senior posts in the Russian government that saw the promotion of two key allies of President Vladimir Putin on Monday.

Kiriyenko's duties as head of Rosatom, which controls Russia's civilian and military nuclear industry, will include overseeing the ongoing construction of Iran's first nuclear reactor at Bushehr.

Previously Putin's special envoy to the Volga region, Kiriyenko replaces Alexander Rumyantsev, who headed Rosatom from 2001.

A well-known liberal politician with a reputation as an efficient manager, Kiriyenko was dismissed from the prime minister's post after only a few months' tenure in the wake of Russia's 1998 financial crisis.

He later helped found the opposition Union of Rightist Forces party in 2001, along with other reformists who served under former president Boris Yeltsin.

Reaction to the appointment was mixed.

"Kiriyenko is a good administrator, pro-Western," said Alexander Pikayev, an analyst from the Moscow-based Institute of World Economy and International Relations.

Pavel Felgenhauer, an independent analyst, said the appointment of an official with no background in the nuclear industry could cause difficulties.

"This is the first time the head of Rosatom has not come from the ranks of nuclear specialists. He risks having difficulties managing the agency," Felgenhauer said.

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