updated 4/4/2004 3:27:40 AM ET 2004-04-04T07:27:40

Iran on Sunday denied a Reuters report quoting diplomats who said traces of bomb-grade uranium had been found at sites in Iran other than the two already declared to U.N. nuclear inspectors.

"Reuters is making false, baseless and unfounded propaganda," Foreign Ministry spokesman Hamid Reza Asefi told a news conference.

A Western diplomat told Reuters on Friday that enriched uranium had been found in sites other than the Natanz enrichment centre and a workshop of the Kalaye Electric Company, already known to the U.N. nuclear watchdog.

The United States accuses Tehran of pursuing nuclear weapons but Iran insists its ambitions are limited to generating electricity.

Sources based in Vienna, the home of the U.N. International Atomic Energy Agency (IAEA), who follow its work on Iran, confirmed traces had been found at other sites, but the agency would not comment.

Last month, the IAEA passed a resolution deploring Iran's failure to declare potentially arms-related activities.

Iran's omissions of key atomic technology from an October resolution included undeclared research on advance "P2" centrifuges that can make bomb-grade uranium.

But Asefi on Sunday said there were no further undeclared nuclear sites.

"There is no nuclear center in Iran which we have hidden from inspectors," he said.

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