Iran on Wednesday voiced optimism about Thursday's meeting in Vienna of the watchdog International Atomic Energy Agency (IAEA).

Foreign Minister Manouchehr Mottaki vowed to continue standing up to pressure from the West to abandon sensitive nuclear technology and said he considered "the circumstances of the next IAEA meeting to be more constructive and positive than the previous one."

In September, the IAEA's 35-nation board of governors found Iran in non-compliance with the nuclear Non-Proliferation Treaty (NPT), paving the way for the Islamic republic to be referred to the Security Council for possible sanctions.

Iran is suspected, despite its denials, of using an atomic energy drive as a cover for weapons development.

The IAEA also in September called on Iran to cease all nuclear fuel work, to cooperate fully with an IAEA investigation and to return to talks with the European Union on guaranteeing it will not make atomic weapons.

Iran has done none of these three things.

It has, however, increased cooperation with the IAEA, allowing access to a key military site and handing over sensitive documents, one from a black market network that contained plans for making the explosive core of an atom bomb.

The IAEA is still being blocked from another military site. It also seeks more documents and says full Iranian cooperation is "overdue," according to an IAEA report released ahead of the board meeting.

Iran has threatened to limit cooperation with the IAEA, and even break a suspension of uranium enrichment, if the matter is taken to the Security Council.

But the Vienna-based IAEA is expected to hold off on such a referral when it meets on Thursday.

Diplomats said the European Union and the United States want to give Russia time to get Tehran to agree to a compromise for Iran to give up enriching uranium on its soil and to do this in Russia.

Iran would thus get enriched uranium but not master the enrichment technology that is a proliferation risk, since enriched uranium can be fuel for civlian power reactors but also the raw material for atom bombs.

But Mottaki said: "Enrichment and the fuel cycle are things that the Islamic Republic of Iran considers to be natural and legitimate rights and within the framework of the NPT."

"It is natural that Iran wants to keep these activities within its own borders," he said.

Referring Iran to the council "will not happen at this week's meeting," said a Western diplomat, who asked not to be identified due to the sensitivity of the issue.

Diplomats said the IAEA board would not even pass a resolution on Iran.

There would only be a summary of the debate by the board chairman, diplomats said.

"The action is elsewhere," a diplomat said, referring to plans by Russia and the EU negotiators -- Britain, France and Germany -- to meet with Iran on December 6 to break the deadlock.

A European diplomat said the idea for the December meeting would be to "talk about (resuming) talks" between Iran and the EU negotiators.

But the diplomat said Iran must be "prepared to discuss seriously" the Russian compromise proposal.

A European diplomat said there was "no guarantee of a meeting on December 6," as it depended on how Iran reacted.

But another diplomat said the meeting would occur, most probably in Vienna, unless Iran escalated the crisis by breaking its current suspension of uranium enrichment.

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