U.N. nuclear inspectors recently counted nearly 200 advanced machines fully or partially installed at Iran's main uranium enrichment site, the International Atomic Energy Agency reported Thursday, confirming diplomats' accounts that Tehran has begun a major upgrade of a program that can be used to make atomic arms.

Iran denies it wants such weapons and says it is enriching only to make reactor fuel and for scientific and medical purposes under international law specifically allowing such activities.

But because it hid its enrichment program _ and other nuclear activities _ for decades, many countries fear that Tehran ultimately wants to enrich to weapons-grade level, suitable for arming nuclear warheads. U.N sanctions and Security Council demands for a halt in enrichment have been ineffective, with Iran instead expanding the activity.

The IAEA also has failed to re-launch an investigation into allegations that Iran worked secretly on components of a nuclear weapons program.

Noting a years-long lack of progress, the report said that without Iranian “engagement,” the IAEA will be unable to resolve concerns “which need to be clarified to exclude the existence of possible military dimensions to Iran's nuclear program.”

Iran announced in January that it planned to upgrade its Natanz enrichment facility, then said earlier this month that it had started doing so. On Wednesday, diplomats told The Associated Press that upward of 100 enriching centrifuges had already been installed.

However, the IAEA report, circulated Thursday to the 35-nation agency board, was the first independent and on-record confirmation that the work had begun and was advancing.  The confidential IAEA report, which was leaked to news media, said IAEA inspectors saw 180 of the high-tech IR-2m centrifuges fully or partially mounted at Natanz during a Feb. 6 inspection tour.

The advance is significant both in terms of technology and timing. The IR-2ms can enrich three to five times faster than the outmoded machines now being used at Natanz. For nations fearing that Iran may want to make nuclear arms that would mean a quicker way of getting there, should Tehran actually break out of the present peaceful enrichment program it has shown the IAEA and openly work on a weapon.

The start of the upgrade is also of concern to six world powers preparing to resume talks with Iran about its nuclear program on Tuesday in Kazakhstan. They want Tehran to cut back on enrichment _ but the installation of new machines instead sends the signal that the Islamic Republic has no intention of doing so.

Israel _ which sees Iran's nuclear program as an existential threat that must be stopped by all means, including a military strike _ was quick to condemn the Iranian advance.

The report's findings “prove that Iran continues to advance quickly to the red line” that Israel considers intolerable, said a statement from Prime Minister Benjamin Netanyahu's office, adding: “Iran is closer than ever to achieve enrichment for a nuclear bomb.”

The “red line” also was a term Netanyahu used to the U.N. General Assembly. There, he said the world has until next summer at the latest to stop Iran before it can build a nuclear bomb.

U.S. State Department spokeswoman Victoria Nuland called the centrifuge upgrade “yet another provocative step” that the six powers _ the United States, Russia, China, Britain, France and Germany _ will focus on at their upcoming talks.

“It's very hard for the international community to understand what Iran is doing, when it claims that all of this is peaceful,” she told reporters.

Both she and the British Foreign Office suggested that the centrifuge installations would additionally burden already difficult nuclear negotiations with Tehran, which have led to lack of substantial progress in previous rounds. While the U.S. and its Western allies want a rollback of enrichment before any easing of sanctions crippling Iran's oil sales and financial transactions, Tehran has refused to even consider making a move before some sanctions are removed.

Nuland said the move on the centrifuges “doesn't make it any easier to get where we want to go,” while the Foreign Office, in a separate statement, said the timing “concerns and disappoints us."

It was unclear, however, how quickly Iran would proceed with the centrifuge upgrade. It hinted last month that it planned to install more than 3,000 of the new machines, and former IAEA Deputy Director General Olli Heinonen has told the AP that Tehran could do that within nine months, assuming it has the components to make them.

But a senior diplomat who is familiar with the report said the agency could not tell whether Iran did in fact possess enough centrifuges _ or the raw materials to make them _ to reach that goal any time soon. He said the next few months will be crucial to establishing how many machines will be installed and in what time frame. The diplomat demanded anonymity because he was not authorized to comment.

The IAEA report noted that other developments reflecting Iran's determination to expand enrichment. It said that Tehran had installed 2,255 of its mainstay IR-1 centrifuges since the last report on Nov. 16, bringing the total to 12,699 _ although not all were operating.

David Albright, whose Institute for Science and International Security is often consulted by the U.S. government on proliferation issues, said that at that pace “Iran is installing the IR-1 centrifuge at a faster-than expected rate.”

The report also said the number of other advanced centrifuge models being tested at an R&D site at Natanz separate from its enrichment plant had substantially increased to more than 300 as of this month.

While moving to increase the potency of its enrichment program, however, Tehran also has recently resumed converting some of its higher-level enriched uranium at into reactor fuel plates after suspending the activity last year. That is likely to provide some reassurance to nations concerned about Iran's nuclear aims because the plates are difficult to reconvert back into weapons usable material.

About 700 of the old machines at Fordo _ a site separate from Natanz _ are churning out higher-enriched material that is still below _ but just a technical step away _ from weapons-grade uranium. Iran says it needs that higher-enriched level to fuel a research reactor.

With higher-enriched uranium their immediate concern, the six powers' main demand during the talks on Tuesday in Kazakhstan is suspension of enrichment at Fordo.

About 250 kilograms _ 550 pounds _ of that higher-enriched uranium is considered to be the standard amount needed to make 25 kilograms, or 55 pounds, of weapons grade uranium.

The IAEA report noted that _ with the amount converted subtracted from its present stockpile _ Iran now had close to 170 kilograms of 20 percent enriched uranium. That's 15 kilograms more than in November but still well below the amount needed for a weapon. (AP)