Iranian President Mahmoud Ahmadinejad, centre, seen visiting the Natanz Uranium Enrichment Facility earlier this month, has announced plans for a new enrichment site. (Iranian President's Office/Associated Press)

Iranian President Mahmoud Ahmadinejad has approved the site for a new enrichment facility, his top adviser said Monday, despite demands by the United Nations that Iran halt its nuclear program.

Still, in an apparent attempt to ward off a new UN sanctions, Iran's foreign minister said his country wants to hold further discussions on a nuclear fuel deal that was originally touted as a possible way to ease the standoff but has since hit a dead end.

Canada, the United States and their allies are trying to rally support for new UN sanctions on Iran over its refusal to stop enrichment, fearing Tehran will use the process to build a nuclear weapon.

Iranian Minister for Foreign Affairs Manouchehr Mottaki speaks to reporters during a news conference at United Nations headquarters in New York City on Oct. 1, 2009. (Mary Altaffer/Associated Press)"It is time for Iran to end its defiance of the international community, suspend its enrichment activity and take immediate steps toward transparency and compliance by halting the construction of new enrichment sites," Prime Minister Stephen Harper said in a statement on Feb. 10.

Iran denies any intention to do so, saying its nuclear program aims only to generate electricity.

The new enrichment plant would be Iran's third. Ahmadinejad approved the location for the new facility, his top adviser Mojtaba Samareh Hashemi said, without specifying where the site is.

Samareh Hashemi said work will begin "upon the president's order" but did not specify when, the ILNA news agency reported Monday.

Iran's government approved plans in November to build 10 new uranium enrichment facilities. Earlier this year, Iran's nuclear chief announced that construction on two of the 10 would begin during this Iranian calendar year, which runs from March 2010 to March 2011.

Iran currently has two uranium enrichment plants — one operating in the central city of Natanz and a second, near the city of Qom, that has not begun enriching.

Talks planned with China, Russia

The United Nations has demanded enrichment be suspended because the process can be used to produce a nuclear bomb as well as fuel for a nuclear reactor. It has already imposed three rounds of limited financial sanctions.

Iranian Foreign Minister Manouchehr Mottaki said Iran would be sending delegations to China and Russia, as well as temporary council members Lebanon and Uganda, for talks on the moribund nuclear fuel deal.

Mottaki said Iran wants direct talks about the deal with all the Security Council members except the U.S., with which it has no relations and will hold only indirect talks.

The talks halted after Iran last year rejected a UN-backed plan that offered nuclear fuel rods in exchange for Iran's stock of lower-level enriched uranium — a swap that would have curbed Tehran's capacity to make a nuclear bomb.

Under the UN proposal, Iran was to send 1,100 kilograms of low-enriched uranium abroad, where it would be further enriched to 20 per cent and converted into fuel rods that would then be returned to Iran.

Tehran needs the fuel rods to power a research reactor in the Iranian capital that makes nuclear isotopes needed for medical purposes. Sending its own low-enriched uranium abroad would leave Iran with insufficient stocks to further purify to weapons-grade level. Once converted into rods, uranium can no longer be used for making weapons.