VIENNA Iran's demand for changes to a nuclear fuel deal is unacceptable because it could mean Tehran keeping enough enriched uranium for possible use in an atom bomb, the U.N. nuclear watchdog chief said in an interview.
Mohamed ElBaradei also told Reuters on Wednesday that U.N. inspectors had no proof of more covert nuclear sites in Iran but a newly revealed enrichment site made little sense for civilian or military ends and mistrust in Tehran's behavior had grown.
Speaking five days before he retires after 12 years as director-general of the International Atomic Energy Agency, ElBaradei said he was urging Western powers to wait for Iran to take a viable stance on the fuel plan because there was no imminent Iranian nuclear threat.
He said recourse to harsher sanctions against Iran, hinted at last week by Western powers angered by the fuel deal holdup, was likely to be counterproductive. U.N. resolutions against Iran were largely "expressions of frustration," he added.
To prevent Iran nearing the ability to build atom bombs and win time for talks on a lasting settlement of the dispute over its nuclear ambitions, ElBaradei in October drafted a plan for Tehran to send 75 percent of its low-enriched uranium (LEU) to Russia and France. There it would be made into special fuel for a nuclear medicine reactor that will run out of it next year.
The draft deal has stumbled over Iran's insistence on giving up no LEU until the fuel reaches its soil.
This would defeat the goal of the six world powers -- Britain, France, the United States, Germany, Russia and China -- of cutting Iran's LEU reserves to less than the quantity needed to fashion a nuclear warhead, if refined to high purity.
"They are ready to put material under IAEA control on an (Iranian) island in the Persian Gulf. But the whole idea as I explained to them, to defuse this crisis, is to take the material out of Iran," said ElBaradei.
"I do not think (Iran's counter-proposal) will work as far as the West is concerned, he said.
ElBaradei, still trying to broker a compromise, said there had been no action to break the impasse for weeks. Iran had yet to give him a formal answer to his plan as promised a month ago.
ElBaradei welcomed U.S. President Barack Obama's readiness to wait until the end of the year for Iran to give ground before considering further sanctions, but Tehran should not waste time.
"Some in Iran say to send out LEU is an insult to the country, an act of humiliation. But this is an opportunity that is unique, and fleeting," he said.
"Unless Obama sees a (workable) response from Iran, he will not be able to sustain his initiative (for nuclear detente with Iran) ... But I'm not throwing in the towel."
Iranian officials seemed interested in negotiating a deal rather than escalating confrontation, he said.
Iran's recent 15 percent cut in the number of centrifuge machines refining uranium at Iran's main Natanz complex may be a sign of "political" restraint, said ElBaradei.
He said resorting to coercive sanctions could backfire by bolstering the status of Iranian nuclear hardliners.
"NO DURABLE SOLUTION"
"We have gone through a lot of (U.N.) Security Council resolutions (on Iran), a lot of (IAEA) board of governor resolutions. To me, a lot of these are just expressions of frustration that things are not moving. But I don't see them frankly to be helping in finding a durable solution," he said.
ElBaradei suggested that a six-power attempt to have the IAEA's 35-nation governing body pass a resolution later this week pressing Iran over its hitherto secret second enrichment site could stoke Iranian defiance, rather than more cooperation.
He had already asked Iran in writing for documentation on the chronology and original purpose of the site in a mountain bunker at Fordow near Qom, since it did not make sense as a standalone site for producing civilian nuclear energy.
"We have no indication that there are other undeclared facilities in Iran. I want to be very clear about that," he said, despite a November 16 IAEA report saying Fordow "reduced the level of confidence" in the absence of other clandestine plants.
Nor did the IAEA have information of covert nuclear plans.
But doubts reigned because "you cannot really use (Fordow) for civilian purposes. It's too small to produce fuel for a civilian reactor. It would take a very long time. Even for military purposes it is too small to produce the amount of (bomb) material needed, it would take a very long time (too)."
Analysts say it would take almost 90 years for Fordow's planned 3,000 centrifuge machines to yield enough low-enriched uranium to fuel one commercial nuclear power plant for a year and one-to-four years to make fissile material for one bomb.
Asked about studies assessing the plant did not look viable except as part of a network of covert sites, including a uranium ore processing hub to feed Fordow's centrifuges, ElBaradei said "these are valid questions" his inspectors would probe further.
Iran proclaimed the site's existence to the IAEA in September, at least two years after construction began. The IAEA says Iran was legally obliged to own up about the facility as soon as plans were drafted. The Islamic Republic contests this.
"This adds to the confidence deficit (about Iran)," he said.
"But people should stop threatening the use of force because that simply ... creates a justification or pretext for countries to say well, we have to go underground because we are being threatened," ElBaradei said, alluding to Israeli and U.S. hawks.
Iran has said the Fordow plant, like the much larger one at Natanz, was conceived to refine uranium only for peaceful uses.
ElBaradei said Tehran had told him Fordow would preserve its enrichment technology if Natanz were bombed.
ElBaradei also denied reports, based on leaks of classified IAEA analyses, saying the agency had concluded Iran had developed technology needed to assemble a nuclear warhead.
He said intelligence material pointing to nuclear arms research by Iran used by IAEA analysts was serious but had not been verified as genuine. Iran says the intelligence was forged.
(Additional reporting by Sylvia Westall; Editing by Charles Dick)