VIENNA (AFP) — The UN atomic watchdog will meet this week to discuss what its inspectors term "alarming" indications that Iran may have been working to build a nuclear bomb until just a few years ago.

The 35-member board of governors of the International Atomic Energy Agency is scheduled to hold its regular summer board meeting at the watchdog's headquarters from Monday to Friday.

Topping the agenda will be the latest report by IAEA Director General Mohamed ElBaradei on the agency's long-running investigation into Tehran's controversial nuclear drive.

Iran insists its atomic programme is entirely peaceful, but western countries, and the United States in particular, are convinced the Islamic republic is covertly seeking to build a nuclear bomb.

In the sternly-worded report, circulated to board members last week, the IAEA expressed "serious concern" that Iran is hiding information about alleged weaponisation work, as well as defying UN demands to suspend uranium enrichment.

At the centre of the IAEA's concerns is intelligence suggesting Iran may have been looking into high explosives of the sort used in implosion-type nuclear bombs, and exploring modifications to missiles consistent with making them capable of delivering a nuclear weapon.

Iran has repeatedly dismissed the intelligence as fake and fabricated.

But the intelligence, gathered from as many as 10 different countries, was compelling enough to warrant concern about the true nature of Iran's atomic programme, said the IAEA's head of safeguards Olli Heinonen.

"Substantive explanations are required from Iran," the report insisted.

The alleged weaponisation work "remain a matter of serious concern. Clarification of these is critical to an assessment of the nature of Iran's past and present nuclear programme."

Compared with previous reports, ElBaradei's latest one appears to be taking a much tougher line against Tehran, experts have said, an interpretation backed up by Iran's somewhat irate response.

In Tehran on Wednesday, Iran's new parliament speaker Ali Larijani warned the country could review its relations with the UN watchdog.

In preparation for next week's board meeting, Heinonen briefed diplomats on the technical aspects of the report on Thursday.

And the picture he painted was a "deeply troubling one", said one diplomat who attended the meeting.

Heinonen himself had even expressed "alarm" that Iran has in its possession a document describing the process for making what could be the core of a nuclear weapon, a western diplomat said.

The 15-page document describes the process of machining uranium metal into two hemispheres of the kind used in nuclear warheads.

Iran has told the IAEA that it received the document back in 1987 along with design information for the so-called P1 centrifuges used to enrich uranium.

Tehran insists it did not request the uranium metal document.

But the IAEA argues it needs to understand the precise role of the document to be able to determine the true nature of Iran's nuclear activities.

Iran's ambassador to the IAEA, Ali Asghar Soltanieh, rubbished the intelligence.

The fact that none of the documentation had any official stamp marking it as confidential or top secret and numerous other discrepancies were proof that the intelligence was "forged and fabricated," Soltanieh said.

Western countries such as the United States remain unconvinced by such statements, however, and insist the onus is on Tehran to actively disprove the allegations rather than simply dismiss them as untrue.

"As (Heinonen's) briefing showed us, there are strong reasons to suspect that Iran was working covertly and deceitfully, at least until recently, to build a bomb," said the US ambassador to the IAEA, Gregory Schulte.

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