VIENNA - World powers are demanding that Iran immediately mothball a uranium enrichment site it hid for years, heightening fears it is planning to build atom bombs, in a resolution to be voted on by U.N. nuclear watchdog governors.

Diplomats forecast majority approval for the resolution in a vote in Vienna by the International Atomic Energy Agency's (IAEA) 35-nation governing board on Thursday or Friday in what would be its first action against Iran in almost four years.

The move reflects dismay over Iran's September disclosure of a second enrichment site it had been building clandestinely for two years, and frustration at Iran's holdup of an IAEA-brokered plan to give it fuel for its nuclear medical program if it parts with enriched uranium that could be used in weapons.

IAEA chief Mohamed ElBaradei told the governors that his investigation into intelligence reports indicating Iran researched ways to make nuclear bombs was at a dead end due to Iranian stonewalling.

The last IAEA board resolution passed against Iran was in February 2006 when governors referred Tehran's case to the U.N. Security Council over its refusal to suspend enrichment and open up completely to IAEA inspections and investigations.

The new measure's sponsors were the United States, Britain, France, Germany, Russia and China, the six locked in a long standoff with Iran over its enrichment activity, alleged nuclear bomb research and restrictions on IAEA inspections.

Russian and Chinese support was significant, and expected to secure rare developing nation votes against Iran, since the two have often blocked a tough united front against Iran in global security bodies and avoided direct criticism of Tehran.

Vienna diplomats said China was won over at the last minute by strong Western lobbying. It was not clear how.

The Washington Post reported on Wednesday U.S. officials had persuaded Beijing that big power unity to rein in Iran was now indispensable because Israel saw Iran's nuclear drive as an existential threat that could lead to a Middle East war, stopping Iranian oil exports crucial to China's booming economy.

But it was unclear whether Moscow and Beijing's expression of disenchantment with Iran, an important trade partner for both, would translate into readiness for harsher U.N. sanctions Western powers will push for if the fuel deal falls through.

A November 16 IAEA report said Iran violated a transparency statute by admitting the existence of the Fordow enrichment site only two months ago, at least two years after building began, and raised concern it could be harboring more secret sites.

Iran had previously assured the IAEA it was not concealing nuclear activity with potential weapons applications.

RESOLUTION COULD BACKFIRE

The draft resolution, a restricted copy of which was obtained by Reuters, urged Iran to immediately halt construction of the Fordow plant, clarify its original purpose and confirm it has no more hidden atomic activity or covert plans for any.

It voiced serious concern -- a diplomatic euphemism for alarm -- over its cover-up of the Fordow project and said it was in blatant breach of U.N. demands for an enrichment suspension.

It also called on Iran to shelve all enrichment-related activity as demanded by Security Council resolutions since 2006, grant unfettered IAEA inspections and open up to an IAEA probe into suspicions it conducted illicit nuclear weapons research.
But ElBaradei suggested to Reuters in an interview on Wednesday the new resolution could backfire by aggravating Iran's siege mentality, boosting nuclear hardliners.

Iran's envoy to the IAEA,Ali Asghar Soltanieh, told Germany's Sueddeutsche Zeitung newspaper on Thursday the resolution would endanger the prevailing constructive atmosphere and have long-term consequences.

He was alluding to IAEA efforts to broker a compromise to salvage the nuclear fuel supply plan and Iran's stated readiness to resolve IAEA questions about the Fordow enrichment site.

The P5+1 (six powers) will win the battle in the Board of Governors, but it will be only a simple majority, but lose the war to get Iran to be more cooperative, a senior diplomat from the bloc of developing nations said.

Tehran says the bunkered Fordow site, which is to start operations in 2011, is a backup for its much larger Natanz enrichment center in case it is bombed by foes such as Israel.

Western nuclear analysts say Fordow's low capacity makes it unsuitable for any purpose but to enrich smaller quantities of uranium suitable for a bomb. Enrichment plants generally need tens of thousands of centrifuges to feed a nuclear power plant.

(Editing by Janet Lawrence)

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