Iran would redesign its Arak heavy-water reactor to greatly limit the amount of plutonium it could make, the country's vice-president said, marking a major concession from the Islamic Republic in negotiations with world powers over its contested nuclear programme.
The comments by Vice-President Ali Akbar Salehi come as the talks face an informal July 20 deadline to hammer out a final deal to limit Iran's ability to build nuclear arms in exchange for ending the crippling economic sanctions it faces.
Iranian state television quoted Salehi, who heads the Atomic Energy Organisation of Iran, as saying that Iran had proposed to redesign Arak to produce one-fifth of the plutonium initially planned for it.
He said that would eliminate concerns the West had that Iran could use the plutonium produced at Arak to build a nuclear weapon.
"The issue of the heavy-water reactor ... has been virtually resolved," state television quoted Salehi as saying. "Iran has offered a proposal to ... redesign the heart of the Arak facility and these six countries have agreed to that."
There was no immediate comment from the world powers - China, France, Germany, Britain, the United States, and Russia.
However, what to do with Arak, a still-under-construction 40-megawatt heavy-water plant in central Iran, is a key factor in negotiations.
Iran's foreign minister, Mohammad Javad Zarif, his country's chief negotiator, suggested in March his country might redesign Arak to allay the West's fears.
The West suspects Iran could use its nuclear programme to build nuclear weapons. Iran says its programme is for peaceful purposes, like power generation and medical research.
Salehi said the US and its allies "constantly say Iran has to give up its heavy-water reactor because it provides a breakout capacity".
"We took this pretext from their hands," he said.
Redesigning the reactor would delay its launch by about three years, Salehi said. He said instead of uranium oxide, the reactor would use low-enriched uranium. Changing the fuel is part of the technical modifications that greatly reduce the amount of plutonium made by the reactor.
Salehi also said Iran had completed diluting its higher-enriched uranium into less volatile forms as part of an interim deal reached last November with world powers.
"On April 12, about 103kg of uranium were diluted," he said. "That means it was converted from 20 per cent enriched uranium into 5 per cent. In general, the case of dilution is closed."
Salehi also told al-Alam, the Arabic channel of Iranian state television, that a proposal from the six-nation group was to change the heavy-water reactor into a light-water reactor.
He suggested that Iran did not agree with that because a heavy-water reactor was needed to produce radioisotopes to treat medical patients while a light-water reactor, like the one Iran has at Bushehr, was used to generate electricity.
Under the November deal, Tehran stopped enrichment of uranium to 20 per cent - which is a possible pathway to nuclear arms - in exchange for the easing of some Western sanctions.
It also agreed to dilute half of its 20 per cent enriched uranium to 5 per cent and turn the remaining half into oxide, which is very difficult to use for bomb-making materials.