Iran Nixes Nuke Compromise

Iran will no longer consider a proposal to move its uranium enrichment program to Russian territory and is instead considering large scale uranium enrichment at home, the Foreign Ministry spokesman said Sunday.

Russia has sought to persuade Iran to move its enrichment program to Russian territory, which would allow closer international monitoring. Iran had insisted that the plan was negotiable and reached basic agreement with Moscow but details were never worked out.

"The Russian proposal is not on our agenda any more," Foreign Ministry spokesman Hamid Reza Asefi said.

Foreign Minister Manouchehr Mottaki, meanwhile, said Sunday Iran had no intention to use oil as a weapon in its confrontation with the West over its nuclear program, contradicting Interior Minister Mostafa Pourmohammadi who said a day earlier that Tehran could use oil as a weapon if the U.N. Security Council imposed sanctions against it.

"The Islamic Republic of Iran is insisting to provide Asia with the oil it needs as a reliable and effective source of energy and will not use oil as a foreign policy instrument," he told a conference on energy and security issues in Tehran Sunday.

Iran is the No. 2 producer in the Organization of Petroleum Exporting Countries after Saudi Arabia. It also has partial control of the narrow Straits of Hormuz, a key route for most of the crude oil shipped from the Persian Gulf nations to world markets.

Asefi's comments to reporters effectively mean the Russian proposal is dead after the International Atomic Energy Agency referred Iran to the U.N. Security Council last week.

"Circumstances have changed. We have to wait and see how developments unfold within the (U.N. Security Council) five veto-holding countries," Asefi said.

The United States and its Western allies accuse Iran of seeking to develop nuclear weapons. Iran denies any intention to build weapons, saying it only aims to produce energy.

"The five permanent members of the U.N. Security Council favor a negotiated solution," says CBS News Foreign Affairs Analyst Pamela Falk, "and the next step is likely to be a Presidential Statement, which does not require a vote by Security Council members, and would be formally issued by Argentina, which holds the Presidency for the month of March."

Falk adds, "The draft document that is being negotiated for submission early in the week is likely to ask the international atomic watchdog agency to report back to the Security Council on Iran's compliance without any reference to targeted sanctions.

"But the statements coming out of Teheran and Washington are certainly ratcheting up the pressure to find a diplomatic way out of the increasing threat that Iran will restart full uranium enrichment programs," Falk says.

The council has the power to impose political and economic sanctions on Iran if it doesn't back down.

Asked if Iran will resume large scale uranium enrichment in response to Iran's referral to the Security Council, Asefi said: "Regarding industrial scale uranium enrichment, we are going to wait for two, three days."

Asefi was suggesting that Tehran wanted to see what the Security Council decides in a meeting scheduled for later this week before it makes a final decision on the enrichment.

Iran only has an experimental nuclear research program and scientists say it would need months to begin any large-scale enrichment.

Iran has repeatedly warned it will begin large-scale uranium enrichment if the IAEA formally refers it the Security Council for possible sanctions. Last week, it offered what it called a "final proposal" to agree to suspend large-scale enrichment temporarily in return for IAEA recognition of its right to continue research-scale enrichment.

The U.S. and its European allies within the IAEA board ignored the Iranian offer, insisting that the time had come for Iran's nuclear dossier to be moved to the Security Council.

Last week, Iran, Russia and the Europeans explored plans that essentially would allow Iran small-scale enrichment after re-imposing a freeze for an undefined period to rebuild international trust. But talks broke up without any agreement.

U.S. Ambassador John Bolton and other senior American officials have suggested that if the Security Council does not take tough action, Washington might look elsewhere to punish Iran — possibly by rallying its allies to impose targeted sanctions.

"We are going to press for as vigorous a response in the council as we can get, and hope that that gets the Iranians' attentions," Bolton said Thursday. "This is a test for the council. And if the Iranians do not back off from their continued aggressive pursuit of nuclear weapons, we will have to make a decision of what the next step will be."

But Russian Foreign Minister Sergey Lavrov said talks should be held that include Moscow, the United States, China, France, Germany, Britain and the International Atomic Energy Agency.

Iran has insisted it will never give up its right under the Nuclear Nonproliferation Treaty to enrich uranium and produce nuclear fuel. It restarted research-scale uranium enrichment last month, two years after voluntarily freezing the program during talks with Germany, Britain and France.

A report last week by IAEA head Mohamed ElBaradei said Iran was testing centrifuges, which spin uranium gas into enriched uranium, and had plans to begin installation of the first 3,000 centrifuges late this year. Iran will need to install about 60,000 centrifuges for a large-scale enrichment of uranium.

Enrichment is a key process that can determine the direction of a nuclear program. Uranium enriched to a low level produces fuel that can be used in a nuclear reactor, while higher enrichment produces the material needed for a warhead.