The meeting between Ali Larijani and International Atomic Energy Agency head Mohamed ElBaradei in Vienna comes ahead of the expiry this week of the latest UN Security Council deadline for Iran to halt sensitive nuclear work.

It also coincides with a surprise announcement by Russia, which is building Iran's first atomic power plant, that the much-delayed project could be put off again due to financing and equipment supply problems.

"Ali Larijani, secretary of the supreme national security council, will meet Mohamed ElBaradei in Vienna on Tuesday," Ali Asghar Soltanieh, the Iranian ambassador to the IAEA, told the state news agency IRNA.

The IAEA is also due to issue a report on Friday on Iran's compliance with Security Council demands that it halts uranium enrichment, and is likely to confirm that the work is continuing in defiance of the council.

In Vienna, the IAEA declined to confirm the encounter, with spokeswoman Melissa Fleming saying on Monday only that "they've asked for a meeting tomorrow."

Iran has steadfastly refused to accede to Western demands that it suspend uranium enrichment, a process that the West fears could be used to make nuclear weapons rather than atomic fuel.

Instead, Larijani and other Iranian officials have been suggesting that Iran place a formal limit on the degree of its enrichment as a guarantee that it is not seeking an atomic bomb.

It is not clear what ElBaradei and Larijani will discuss. Their meeting comes just over a week after Larijani met EU foreign policy chief Javier Solana for the first time in months at a security conference in Munich.

Solana had been spearheading EU efforts to find a compromise solution to the standoff but the talks with Iran collapsed in September when Tehran refused to suspend enrichment.

Larijani was expected to meet ElBaradei just before he attended the Munich conference but the talks were called off at the last minute amid reports that the Iranian chief negotiator was ill.

The new deadline for Iran to suspend enrichment came in the same UN resolution that imposed targeted sanctions against Iran's nuclear industry and ballistic missile sectors.

The United States, Iran's arch enemy, has threatened to crank up sanctions and impose unilateral measures of its own if Tehran does not fall into line.

The United States accuses Iran of seeking a nuclear weapon, a charge denied by Tehran which insists its atomic programme is peaceful in nature.

Russia has been building Iran's first atomic power station in the southern city of Bushehr, a much delayed project that until now had been finally scheduled for launch in September.

But a spokeswoman for the station's Russian builder said Monday the launch of the facility was likely to be delayed yet again due to late payments by the Iranian side and problems obtaining equipment.

"Financing of the project by the Iranian side has practically been frozen since mid-January," Irina Yesipova, spokeswoman for Atomstroiexport, told AFP.

"We will soon analyse with the Iranian side the current state of the project and its calendar," she said.

Andrei Cherkasenko, chief executive of the Atompromresurs company, told RIA Novosti that vital cooling equipment had not been received from third-country suppliers.

The equipment was expected to arrive only at the end of 2007 or the start of next year, he said, adding that commissioning could only take place several months after the receipt of the equipment.

A source in the nuclear industry said an Iranian delegation would visit Moscow for talks by the end of February.

Meanwhile, Iran's ideological army, the Revolutionary Guards, on Monday launched three days of country-wide war games aimed at readying its defensive capabilities.

Although Washington has said it wants the nuclear standoff resolved through diplomacy, it has never ruled out military action to thwart Iran's atomic drive.

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