Iran is ready to begin installing 3,000 centrifuges for industrial-scale production of nuclear fuel, which the West fears could lead to atom bombs, after completing preparations at an underground plant, diplomats said.

The diplomats referred to findings by inspectors from the nuclear watchdog International Atomic Energy Agency (IAEA) who visited the Natanz uranium-enrichment complex over the past week.

It was the first independent confirmation of statements by Tehran that it was prepared to press ahead with expanding what so far has been a limited research-level enrichment program, whose goal Tehran says is solely to generate electricity.

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Iran has tried to counter diplomatic reports of delays caused by technical problems or political hesitation after the UN Security Council last month banned trade in nuclear items with Tehran over its refusal to stop enriching uranium.

"Everything has been prepared for assembling (installing) the centrifuges at Natanz for the beginning of the industrial phase of enrichment," a European diplomat said, asking for anonymity in exchange for discussing confidential information.

"The hardware is now in place," he said, alluding to piping, casing and other infrastructure Tehran needed to equip the vast underground hall to enable installation of centrifuges.

Two other diplomats had similar information.

The first diplomat said Iran had not begun to rig up the centrifuges, which whirl at supersonic speed to enrich uranium gas into nuclear fuel, and might be pausing for an appropriate date to announce it with considerable fanfare.

Such a proclamation could come when Iran marks the anniversary of its Islamic Revolution in early February.

President Mahmoud Ahmadinejad said during a Latin American trip on Monday that a ramping-up of uranium enrichment activity at Natanz would take place "very soon, bit by bit."


60-day deadline
The United States and the European Union suspect Tehran, which frequently calls for Israel's destruction, is seeking to build nuclear bombs and say it will face broader, financially harsher sanctions if it ignores the UN Security Council resolution, which gave Iran 60 days to shelve enrichment work.

Iran now runs two experimental cascades of 164 connected centrifuges in the pilot, ground-level section of Natanz.

Diplomats said earlier in the week Tehran still appeared to be both feeding uranium "UF6" gas into these centrifuges, enriching nominal amounts, and test-running them empty, a pattern prevailing for some months.

Iran has struggled to get centrifuges to run smoothly in unison for sustained periods, the key to producing volumes of enriched uranium sufficient to feed a power plant or, if refined to very high levels, detonate a nuclear bomb.

"It's no surprise that the necessary infrastructure (in the underground hall) is now in place. But installing 3,000 centrifuges is another matter," Mark Fitzpatrick, nuclear analyst at the International Institute for Strategic Studies and a former senior U.S. State Department official, told Reuters.

"It doesn't make any technical sense to install 3,000 until they can get the test cascades running well. If they did, it would be a political decision trumping the science," he said.

"They are more likely to install another test cascade underground, as the first installment of the 3,000."

Diplomats close to the Vienna-based IAEA say Iran looks unlikely to bring on line 3,000 centrifuges by its announced deadline of March 20, the end of the Iranian year. Rather, it would take several more months at least, they estimate.