VIENNA (Reuters) -- Iran has moved a stock of enriched uranium back underground after drawing what it needed to refine the material up to 20 percent purity, Tehran's envoy to the UN nuclear watchdog has said.
He dismissed media speculation that Iran had placed a large amount of the material in a visible spot above ground to provoke an Israeli air strike that would give Iran a pretext to expel UN inspectors and develop atomic bombs for security reasons.
Iran has said its move to feed low-enriched uranium (LEU) into centrifuges for higher-scale refinement is to make fuel for a medical isotope reactor.
Western officials and UN inspectors doubt Iran's explanation since it lacks the technical capacity to convert higher-enriched uranium into fuel rods for the reactor, whose Argentine-provided fuel stock is running out.
They fear Iran wants to advance along the road to producing high-enriched -- 90 percent purity -- uranium suitable for the fissile core of an atomic bomb, if it chose later to do so.
Diplomats also questioned why Iran had moved 94 percent -- 1.95 tons of its LEU reserve out of its main, subterranean enrichment plant at Natanz, a much larger amount than would be needed to produce fuel for the reactor in the medium term.
"[This] was merely for producing material for the Iran research reactor. That is why that container is [now] back to its original location," Ali Asghar Soltanieh, Iran's ambassador to the International Atomic Energy Agency (IAEA), told reporters.
A senior diplomat close to the IAEA confirmed the container had been returned underground but could not immediately say how much LEU had been used for higher-scale enrichment.
U.S. media have speculated that, in moving above ground an LEU stockpile Iranian officials have called a strategic asset, Iran thought of goading adversaries such as Israel, which views the Iranian nuclear program as an existential threat.
"For your information, [we] just moved the capsule because technically they needed it and they have put it back. We used the material which we needed for the Tehran Research Reactor," Soltanieh said during a break in an IAEA governors meeting.
Diplomats there discounted the notion of political reasons for Iran having moved much of its LEU stockpile above ground.
"A more likely reason was that Iran needed a large container to provide a steady feed with sufficient pressure for 20 percent enrichment," said one senior diplomat close to the IAEA.
"In any case, this container can be moved back and forth between the pilot and main Natanz facilities in a half hour."
UN nuclear agency chief Yukiya Amano said a reactor fuel-supply offer brokered by his predecessor Muhammad el-Baradei with Russia, France, and the United States, was still open to Iran. Tehran has rejected a key clause requiring it to ship 70 percent of its LEU abroad.
"[It] is the balanced and realistic proposal. That's why I support it and keep it on the table," Amano said.