World powers including Russia had agreed Wednesday on a draft resolution asking the International Atomic Energy Agency's (IAEA) board of governors to report Iran to the Security Council, according to a text obtained by AFP.

The draft is almost certain to win approval on the 35-nation board, ending a two-year US quest to win support for taking Iran to the Council, which unlike the IAEA has enforcement powers and can impose sanctions.

IAEA chief Mohamed ElBaradei, who spoke to the organization's 35-nation governing board, said the standoff over Iran's nuclear program was at a "critical phase," but he said it was not yet a crisis and that Teheran had a chance to regain the trust of the international community.

"It's about confidence building and it is not about an imminent threat," he said to reporters, adding that the IAEA meeting was about pressing Iran to resolve doubts about its nuclear intentions before a conclusive report he is to make at a March 6 meeting.

"All who have spoken on the issue, even those who are supporting Security Council reporting, are making it very clear that the Security Council is not asked at this stage to take any action (that could lead to sanctions), definitely not before I submit my report in March. All of them are saying that this is simply a continuation of diplomacy," ElBaradei said.

The Vienna-based IAEA has been investigating Iran for three years and has said the Islamic Republic hid sensitive nuclear activities for 18 years before the inquest began.

Moving the dossier to the Security Council in New York is a "momentous moment," non-proliferation analyst Mark Fitzpatrick told AFP.

"For the first time the Security Council will be able to consider enforcement measures and Iran for the first time will have to face the prospect of paying the cost for the path it is on," said Fitzpatrick, who is from London's International Institute for Strategic Studies think tank.

But a diplomat close to the IAEA warned that referral could provoke Iran to push ahead with a program it insists is peaceful and reduce cooperation with the atomic agency.

If this happens, "we will not be better off," the diplomat said, especially as the United States and Europe "have no strategy for when we get to New York," where Iranian allies and trade partners Russia and China have vetoes on the Security Council.

Unease among major western powers over action

The five permanent UN Security Council members (P-5) plus Germany agreed in London on Tuesday to bring Iran before the Council but in a compromise with Russia put off UN action until at least the next IAEA meeting in March.

Moscow wants time to find a compromise solution.

US President George W. Bush said Wednesday that he backs a Russian plan to have Iran enrich uranium in Russia in order to avoid Tehran mastering this crucial technology, which makes fuel for nuclear power reactors but also bomb material.

Russia's UN envoy Andrei Denisov warned in New York that slapping sanctions on oil-rich Iran would backfire on the world community as Tehran could retaliate by halting oil and gas exports.

And Iran threatened to retaliate if it is hauled before the Security Council by kick-starting sensitive fuel cycle work and blocking international inspections.

US says Security Council is next step in diplomacy

The United States, which backed off from calling for immediate Security Council action in order to win a consensus from the P-5, stressed that it was seeking a diplomatic solution.

"The reason why we are reporting this to the Security Council is to move diplomacy to a new phase so that we can see if we can achieve a political settlement," UN ambassador Gregory Schulte said in Vienna.

Schulte said the draft resolution "has the support not only of the European Union but also of the United States, also of Russia, also of China and also of a large number of other countries."

The draft, written by Britain, France and Germany, was edited Tuesday and Wednesday, with Russia insisting on deleting any reference to specific IAEA statutes that would authorize punitive measures by the United Nations, a diplomat close to the IAEA said.

Draft resolution calls on ElBaradei to bring Iran to UN

The draft asks ElBaradei "to report to the Security Council of the United Nations" on steps Iran needs to take so that "outstanding questions can best be resolved and confidence built in the exclusively peaceful nature of Iran's program."

The draft says it is "necessary" for Iran to "re-establish full and sustained suspension of all enrichment-related activities and reprocessing activities, including research and development" and fully cooperate with IAEA inspectors

Iran set off the current crisis when it broke IAEA seals on enrichment equipment on January 10.

The draft also calls on Iran "to help the agency clarify possible activities which could have a military nuclear dimension." The draft expresses "serious concern" that Iran has a document on making uranium hemispheres "since as reported by the (IAEA) Secretariat this process is related to the fabrication of nuclear weapons components."