Iran said yesterday it had started installing a new generation of machines for enriching uranium, an announcement likely to annoy the West and complicate efforts to resolve a decade-old dispute over its nuclear programme.

If refined to a high degree, enriched uranium can provide material for bombs

It came on the day the UN nuclear watchdog began talks in Tehran to advance a long-stalled investigation into the programme’s suspected military dimensions.

Iran had already told the International Atomic Energy Agency (IAEA) that it planned to introduce new IR2-m centrifuges to its main enrichment plant near the central town of Natanz - a step that could significantly speed up its accumulation of material that the West fears could be used to develop a nuclear weapon.

“From last month the installation of the new generation of these machines started,” Fereydoun Abbasi-Davani, head of Iran’s Atomic Energy Organisation, was quoted as saying by the Iranian Students’ News Agency.

“We have produced the machines as planned and we are carrying out the installation gradually... to complete the tests.”

One diplomat accredited to the Vienna-based IAEA, which regularly monitors Iranian nuclear sites including the one at Natanz, said he was surprised.

“My understanding until (Abbasi-Davani’s statement) was that they hadn’t started installation,” the envoy said.

Enriched uranium can fuel nuclear power plants, Iran’s stated aim, or, if refined to a high degree, provide material for bombs, which the West suspects is the real purpose - something Iran denies.

If deployed successfully, new-generation centrifuges could refine uranium several times faster than the model Iran now has.

It was not clear how many of the new centrifuges Iran aimed to install at Natanz, which is designed for tens of thousands; an IAEA note to members implied it could be up to 3,000.