This represented efforts to expand research-level enrichment of nuclear fuel into "industrial scale" production.
 
It said Iranian workers lowered into the plant an 8.7-tonne container of uranium hexafluoride gas (UF-6) to prepare to start feeding centrifuges, which can enrich the material into fuel for power plants or, if refined to high levels, for bombs.
 
Iran's defiance of a 60-day deadline set by the council when it banned nuclear technology transfers to Iran on December 23 will expose Iran to wider sanctions over its atomic energy programme, which the West fears is a front for assembling atom bombs.
 
Tehran says it is seeking nuclear-generated electricity.
 
Remote monitoring
 
"Iran has not suspended its enrichment-related activities," said the confidential IAEA report.
 
"Iran has continued with the operation of the [small ground-level pilot fuel-enrichment] plant," it added.
 
"It has also continued with the construction of the [underground] fuel enrichment plant, including installation of cascades, and has transferred UF-6 to the plant," it said.
 
"As of [February 17], no UF6 had been fed into the process at the [underground plant]."
 
Iran intends to install 3,000 centrifuge machines in its Natanz enrichment hall over coming months to lay the basis for "industrial-scale" fuel production involving about 54,000.
 
The six-page report said Iran had agreed to interim IAEA verification procedures at the underground plant but not to remote monitoring.
 
The IAEA had told Iran this restriction would violate non-proliferation safeguard rules once more than 500 centrifuges were installed, according to the report.