"The discovery of enriched uranium is particularly worrying. IAEA inspectors found two different types of highly enriched particles. You do not need that to make nuclear power," the diplomat told AFP.

The findings are contained in a report by the International Atomic Energy Agency (IAEA) that was handed to the UN nuclear watchdog's board of governors here Tuesday ahead of a crucial meeting on Iran.

The diplomat said the report poses questions that "all speak to the purpose of Iran's nuclear programme" and shows "a pattern of non-compliance" with the nuclear Non-Proliferation Treaty.

It includes revelations that Iran "has admitted that it tried to import centrifuge material" and that it started a heavy water programme in the 1980s.

Heavy water is used for reactors that produce plutonium, a material which can be used to make nuclear weapons.

Tehran insists that its nuclear programme is intended purely to help meet its energy needs but the United States charges that it is secretly trying to develop nuclear arms.

IAEA Secretary General Mohamed ElBaradei this week confirmed that enriched uranium was found at Natanz, 180 miles (290 kilometres) south of Tehran, where Iran is building a uranium processing plant.

Diplomats said this week that the report, which ElBaradei will formally present to the board of governors when they start meeting here on September 8, gives no clear verdict on the nature of Tehran's nuclear programme.

But one told AFP "there will clearly be some sort of resolution on Iran from the board", which can refer the matter to the UN Security Council.

In June, an initial IAEA report found that Tehran had not fully respected the Non-Proliferation Treaty by failing to inform the IAEA of some of its nuclear activities, including importing uranium in 1991.

In Tehran the Iranian permanent representative to the IAEA said on television the new report on nuclear activities in Iran was much softer in tone than its predecessor.

"The report was much less severe than the previous one," said Ali Salehi: "Nowhere is there any mention of negligence or omissions by Iran."

As to the samples indicating enriched uranium, the official said these "must still be submitted to laboratory examination and the IAEA will have to take into consideration Iran's explanation that the samples were contaminated while abroad."

Salehi said Iran had submitted a letter to the IAEA on Monday saying it was willing to pursue talks on remaining problems.

WAR.WIRE