Iranian, Europeans meet on nuclear issue

Also Friday, U.N. experts inspected a key Iranian nuclear facility, days after the U.N. atomic watchdog agency reported that its knowledge of the country's activities was shrinking because of restrictions on visits.

Iran's nuclear defiance - most recently documented in a report by the International Atomic Energy Agency that was sent to the U.N. Security Council - has set the stage for further council sanctions against Tehran, and a European official warned against undue expectations from Friday's talks.

"It was a stocktaking session," said the European official who - like diplomats agreeing to discuss the meeting with The Associated Press -spoke on condition of anonymity because the talks were not public.

Still, they suggested that the meeting was positive in demonstrating a joint effort to try to return to negotiations over Iran's enrichment program to try to stave off further sanctions -and a potential escalation of the crisis.

The Pentagon this week moved two aircraft carriers and seven other ships into the Persian Gulf in a show of force. Iran, meanwhile, has detained at least two prominent Iranian-American citizens.

Friday's session in Brussels, Belgium, was meant to prepare the ground for a May 31 meeting in Madrid between Ali Larijani, Iran's leading nuclear negotiator, and European Union foreign policy chief Javier Solana - their second round of talks in just over a month.

It was attended by Larijani deputy Javed Vaidi and senior civil servants of Britain, France and Germany who report directly to their foreign ministers, the officials said. Also present was a senior Solana aide.

In another hopeful sign, U.S. and Iranian diplomats are scheduled to hold direct talks in Baghdad on efforts to stabilize Iraq. The meeting offers a very rare one-on-one diplomatic forum between the nations, which broke off formal relations after Iran's 1979 Islamic Revolution.

The agenda of the talks is limited to Iraqi affairs and should not spill over into the nuclear impasse. But its outcome could influence the chances of success of the Solana-Larijani session in Madrid.

While the two men spoke of progress at their last encounter in Ankara, Turkey, Iran continues to defy a Security Council demand that it immediately suspend all enrichment activities - a stance that threatens to doom all chances of success.

The United States leads opposition to any compromise on enrichment, and the official U.S. stance remains that Iran must scrap all its equipment. Still, a senior diplomat familiar with the issue told the AP that some senior State Department officials are now willing to contemplate a less-stringent definition of what constitutes a freeze.

Such a new definition would allow to keep some machines standing and running without actually feeding them with the uranium gas that - when enriched - can be used either to generate power or create the fissile material for nuclear warheads, said the diplomat. That compromise - plus agreement not to seek suspension before substantive talks begin - might be acceptable to Iran and serve as a basis for new negotiations.

Publicly though, the Americans and their allies are taking issue with recent public suggestions by IAEA chief Mohamed ElBaradei that calls for such middle ground and have criticized his suggestions that it is too late to force Tehran to totally scrap its enrichment program as demanded by the Security Council.

"I believe that (U.N.) demand has been superseded by events," ElBaradei told the Spanish newspaper ABC last week.

In Washington, State Department spokesman Tom Casey said senior U.S., Japanese, French and British diplomats on Friday registered their "concern" about those remarks in a meeting with ElBaradei, at his Vienna-based organization.

The issue gained in importance Wednesday, when ElBaradei sent a report to the Security Council that says Iran has expanded its enrichment activities instead of freezing them - a finding that could act as a trigger for a third set of sanctions.

Although Iran insists it wants the technology only to generate nuclear power, it has been hit with two sets of U.N. sanctions because of suspicions bred by nearly two decades of Tehran's clandestine nuclear activities, including questionable black-market acquisitions of equipment and blueprints that appear linked to weapons plans.

Iran's ultimate stated goal is running 54,000 centrifuges to churn out enriched uranium. That would be enough for dozens of nuclear warheads a year.

The U.N. inspectors visited Iran's uranium conversion facility in the central city of Isfahan and were to next inspect the enrichment plant at Natanz, said Mohammad Saeedi, deputy head of Iran's atomic energy organization.

The conversion facility at Isfahan carries out an earlier step in the process, turning uranium ore into the gas used in enrichment.

"Inspections by the agency are being done based on the Nuclear Non-Proliferation Treaty and general safeguards agreement," Saeedi said, according to state TV. The inspectors arrived in Iran a week ago, he said.

The IAEA report suggested that decreased access by inspectors was potentially as worrisome as defiance on enrichment. It criticized Iran's continued refusal to allow IAEA inspectors to visit a heavy water reactor now under construction at central city of Arak and linked facilities.

Iran insists it is abiding by its inspection requirements under the treaty and other unilateral agreements with the agency. The inspections at Arak were allowed under a separate agreement, and Iran argued it had the right to curtail the deal if it chose to.

President Mahmoud Ahmadinejad vowed to press ahead with enrichment and said Iran plans to export nuclear fuel in the future.

"Not only will we not halt the uranium enrichment centrifuges, but we will quickly integrate them into our nuclear fuel cycle so as to become an exporter of nuclear fuel," Ahmadinejad said late Thursday, according to state TV.

Ahmadinejad shrugged off the possibility of further sanctions, saying those imposed so far "have brought no result for the West."

"There is no doubt that these sanctions will backfire against the arrogant powers, as we will soon see," Ahmadinejad said.

Experts from the United States and five other powers plan to meet within the week to consider the next steps after the IAEA report. The talks will focus on how to bring Iran back to negotiations and what the Security Council could do if Tehran doesn't budge.