By Parisa Hafezi
TEHRAN (Reuters) - Iranian President Mahmoud Ahmadinejad has agreed "in principle" to Brazilian mediation to revive a U.N.-brokered nuclear fuel swap deal with world powers, the semi-official Fars news agency said on Wednesday.
The powers see the deal as a way to remove much of Iran's low-enriched uranium stockpile to minimize the risk of this being used for atomic bombs, while Iran would get specially processed fuel to keep its nuclear medicine program running.
But the proposal broke down over Iran's insistence on doing the swap only on its territory, rather than shipping its LEU abroad in advance, and in smaller, phased amounts, meaning no meaningful cut in a stockpile which grows day by day.
"In a telephone conversation with his Venezuelan counterpart, Ahmadinejad agreed in principle to Brazil's mediation over the nuclear fuel deal," Fars said, quoting a statement issued by Ahmadinejad's office.
The pact conceived in talks conducted by the U.N. nuclear watchdog last October required Iran to ship 1,200 kg (2,646 lb) of its LEU, enough for one atom bomb if enriched to high grade, to Russia and France for conversion into fuel for the Tehran Research Reactor, which makes isotopes for cancer treatment.
The three powers have ruled out rewriting the deal's conditions as the Islamic Republic demands.
The United States is lobbying U.N. Security Council members, to back a fourth round of international sanctions on Iran in the coming weeks, to press it into curbing uranium enrichment.
Iran says its nuclear energy program is designed to generate electricity only but its failure to declare sensitive atomic activity to the U.N. watchdog and continued restrictions on U.N. inspections have undermined confidence abroad.
Some nonpermanent U.N. Security Council members such as Brazil and Turkey have been trying to revive the fuel deal with Iran in an attempt to stave off further sanctions against Tehran.
Brazil says it favors reviving a mooted compromise in which Iran could export its uranium to another country in return for nuclear fuel Iran says it needs to keep the Tehran reactor running.
It was not clear whether Ahmadinejad had agreed for the fuel swap to take place in a third country. If so, it will be a major shift in Iran's stance against the idea.
"Ahmadinejad also said technical issues (over the deal) should be discussed in Tehran," Fars reported.
"SIGNIFICANT CONCESSIONS"
Gala Riani, analyst for IHS Global Insight Middle East, said Iran did not want to be seen as having closed the door to negotiations on the nuclear fuel swap.
But she said it remained to be seen if Tehran's announcement on Brazil's mediation was a real attempt to resolve the issue.
"Unless Iran proposes some significant concessions the likelihood (of a deal) is low," Riani told Reuters.
Iran started enrichment to 20 percent fissile purity in February, up from 5 percent, to create fuel for the research reactor itself, bring Iran closer to levels needed for producing weapons-grade material -- uranium refined to 90 percent purity.
In a speech to a Nuclear Non-proliferation Treaty (NPT) review conference at the United Nations, U.S. Secretary of State Hillary Clinton said on Monday that Iran's nuclear ambitions put the world at risk and called on nations to rally around U.S. efforts to finally hold the Islamic Republic to account.
The five permanent members of the Council -- the United States, Britain, France, Russia and China -- along with Germany are in talks over a broader sanctions resolution against Iran.
Russia and China, veto-wielding members of the Security Council, have said they are willing to give Turkey and Brazil more time to resuscitate the nuclear fuel deal.
Chinese President Hu Jintao will likely discuss Iran's nuclear issue with Russian officials during his visit to Moscow on May 8, a Chinese official said on Wednesday.
"On the Iran nuclear issue, it should be said, the positions of China and Russia are close," Chinese Assistant Foreign Minister Cheng Guoping told a news conference in Beijing.
Analyst Nicole Stracke at the Gulf Research Center in Dubai said Iran was trying to "send positive signals that it is ready to make concessions", aimed at splitting the Security Council and delaying Chinese and Russian agreement on new sanctions.
"... This strategy allows Iran to buy time, which is an essential factor in the technical development of the Iranian nuclear program," she told Reuters in an e-mail.
Additional reporting by Fredrik Dahl in Dubai, Christopher Buckley in Beijing, Writing by Parisa Hafezi; Editing by Samia Nakhoul
Reuters Canada
