By Ali Akbar Dareini

The Associated Press

TEHRAN, Iran – Iran removed U.N. seals on uranium enrichment equipment and resumed nuclear research yesterday, defying demands it maintain a two-year freeze on its nuclear program and sparking an outcry from the United States and Europe.

The International Atomic Energy Agency said Iran plans to enrich uranium as part of its experiments with the nuclear fuel cycle. An IAEA statement issued in Vienna, Austria, said Iran told the agency the scale of its enrichment work would be limited.

U.S. officials denounced Iran’s move, calling it a step toward creating material for nuclear bombs.

“If the regime in Iran continues on the current course and fails to abide by its international obligations, there is no other choice but to refer the matter to the Security Council,” White House press secretary Scott McClellan said.

The U.N. council could impose sanctions on Tehran.

Germany’s foreign minister raised doubts over the future of European-led negotiations on Iran’s nuclear program, questioning whether there remains any basis for more talks.

Britain warned that the international community was “running out of patience” with Tehran, and Foreign Secretary Jack Straw said Iran had breached IAEA resolutions. Straw said he planned to meet his French and German counterparts Thursday to discuss whether to refer Iran to the Security Council.

“There was no good reason why Iran should have taken this step if its intentions are truly peaceful and it wanted to resolve long-standing international concerns,” Straw said.

The latest move came as Iran has been taking a more confrontational line with the West, with hard-line President Mahmoud Ahmadinejad recently calling for Israel to be “wiped off the map” and denying the Holocaust.

The United States accuses Iran of seeking to develop nuclear weapons, a charge denied by Iran, which contends its program aims only to produce energy. France, Germany and Britain have been leading long-troubled negotiations with Iran aimed at ensuring its program is peaceful.

The seals were removed Tuesday from equipment at the nuclear plant at Natanz, the center of Iran’s uranium enrichment program.

Iran stressed it was not resuming enrichment, a key process that can produce either material for a nuclear weapon or fuel for a reactor. Instead, it said it was restarting research activities at the plant.

“What we resume is merely in the field of research, not more than that,” the deputy head of the Atomic Energy Organization of Iran, Mohammad Saeedi, told a news conference. “Production of nuclear fuel” – which would involve enrichment – “remains suspended,” he said.

The IAEA statement said uranium hexafluoride – a gaseous form of uranium – will “be fed into cascades” of centrifuges as part of Iran’s activities. That can produce low-level nuclear fuel or weapons-grade material.

Iranian nuclear workers removed the seals in the presence of IAEA inspectors, then researchers resumed their work, he said. Saeedi did not specify the equipment that had been unsealed, saying that was “a confidential issue between us and the IAEA.”

IAEA spokeswoman Melissa Fleming said the agency’s 35-nation board of governors was informed late yesterday about what the Iranians planned to do with the unsealed equipment.

Iran’s decision to freeze some nuclear activities was voluntary, so the IAEA had no option but to remove the seals at Iran’s request.

The move further erodes the suspension of nuclear activities that has been the centerpiece of Iran’s negotiations with the West. Tehran agreed to the freeze in October 2003 as a confidence-building measure and to avoid being referred to the council.

In August, Iran removed seals at another nuclear plant outside Isfahan and resumed uranium reprocessing. That prompted Europe to break off its negotiations temporarily. The talks resumed in December, and a new round was scheduled for later this month.

French President Jacques Chirac warned Iran it would commit a serious mistake if it ignored the international community on its nuclear program.

German Chancellor Angela Merkel said Iran was sending “worrying signals” on the nuclear issue.

In Vienna, the chief U.S. representative to the IAEA, Gregory L. Schulte, said Iran had shown “its disdain for international concerns and its rejection of international diplomacy.”

“The regime continues to choose confrontation over cooperation, a choice that deepens the isolation of Iran and harms the interests of the Iranian people. Iran is taking another deliberate step toward enrichment, which creates the material for nuclear bombs,” Schulte said.

The West has long pushed for Iran to abandon uranium enrichment, which Tehran has refused to do, insisting it has a right to develop the entire nuclear fuel cycle. The Europeans have been pressing a compromise proposal under which Iran’s enrichment activities would be conducted in Russia to ensure no material is diverted toward weapons.

The European Union, Japan and Russia all expressed concern.

Russian Foreign Minister Sergey Lavrov said his country was working to ensure that Tehran maintains its freeze on enriching uranium until talks can be held between Moscow and Tehran over the proposal to move enrichment to Russia.

In September, the IAEA board of governors passed a resolution telling Iran to return to “full and sustained suspension of all enrichment-related activity” until questions had been answered about the scope of its nuclear program.