Iran yesterday insisted there was no going back from its decision to resume uranium conversion in defiance of the European Union, despite an upcoming meeting of the UN nuclear watchdog and warnings of an international crisis.

Iran's foreign ministry spokesman said the ultra-sensitive nuclear activity would start once inspectors from the International Atomic Energy Agency had put surveillance equipment in place, putting Tehran on a collision course with Europe and the United States.

"The IAEA inspectors will be in Iran by today (Monday) and by tomorrow we will be in a position to give information" on the restart of the uranium conversion plant in Isfahan in central Iran, Hamid Reza Asefi told reporters.

"They need to install additional surveillance cameras and the work will resume once they have been installed," he said.

The IAEA, which has placed

metal seals at the plant, has said that its inspection team will put in place the equipment by the middle of the week. Iran has always emphasised it wants to break the seals in concert with the IAEA.

Iran's decision to resume uranium conversion and its rejection of a deal on nuclear cooperation with the European Union sparked warnings that talks with the bloc could be over and cause UN Security Council intervention.

"If one day, Iran's case is referred to the UN Security Council, we are not worried. If the Europeans choose this way, it's up to them to see if it is to their benefit or not," said Asefi.

The escalating tensions come as new President Mahmood Ahmadinejad takes office, with some diplomats worried the ultraconservative will take an even tougher stance on nuclear issues.

Foreign Minister Kamal Kharazi reaffirmed Tehran's position that the offer from the Europeans of nuclear assistance in exchange for guaran-

tees its nuclear programme is peaceful was unacceptable.

"The main elements that we wanted to see in these proposals, like (the right to) enrichment are not there and thus these proposals are for us without value," he told state television.

The latest comments from Iran come ahead of a meeting of the IAEA board of governors tomorrow, the first step in a process that could see Iran sent to the UN Security Council and then slapped with punishing international sanctions.

Diplomats said it was not expected the body would immediately send Iran to the Security Council at this meeting but would most likely make a renewed appeal to the Islamic republic.

One crucial issue yet to be resolved is whether Tehran will make the fateful move of resuming conversion activities -- the precursor to the uranium enrichment that can be used for a nuclear weapon -before this meeting.