The State Department is defending Secretary of State Colin Powell's (search) comments earlier this week that he has seen information showing that Iran (search) is trying to adapt missiles to deliver nuclear weapons (search).

"I have seen some information that would agree that they have been actively working on delivery systems," Powell told reporters en route to an Asia-Pacific economic summit meeting in Chile on Wednesday.

The Washington Post, citing two officials, reported Friday that Powell was referring to classified information that was based on an unvetted, single source, and had not been verified.

Powell and other senior Cabinet members were briefed last week on the sensitive intelligence, the Post reported. The material was stamped "No Foreign," meaning it was not to be shared with allies, although President Bush decided last week that portions could be shared with British Prime Minister Tony Blair, officials told the newspaper.

ABC news reported a similar story.

But State Department officials told FOX News on Friday that the ABC and Washington Post reports are wrong. They denied that Powell's remarks violated any classified information rule.

State spokesman Tom Casey said Powell did not misspeak and said the Post article is faulty and based on an "assumption from the reporter that intelligence her source has seen on Iranian missile development is the same intelligence provided to Powell."

Casey said that by focusing on a possible misstep on Powell's part, the real point is being lost — that the Iranians are developing delivery systems, as well as working on a clandestine nuclear weapons program that's likely not being pursued for power uses.

Powell was trying to illustrate in his remarks that this is a problem area that people need to take seriously, Casey said.

"Powell said what he said and he stands by it," he said.

Powell: Shouldn't Be 'Brand-New News'

Powell clarified his remarks on Thursday in an interview on Chile's TVN.

"Now, I made a statement yesterday that said we had some information, I've seen some information, and the dissidents have put out more information, that suggest that the Iranians are also working on the designs one would have to have for putting such a warhead into a missile," Powell told TVN.

"This shouldn't be brand-new news. This shouldn't surprise anybody. If they had been working on a nuclear weapon and designed a warhead, certainly they were also trying to figure out how they would deliver such a warhead," he said.

Iran dismissed Powell's remarks about its nuclear program as "baseless," adding he should review his intelligence sources.

Iranian Foreign Ministry spokesman Hamid Reza Asefi was reacting to Powell's comments on claims by the Iranian dissident group, the National Council for Resistance in Iran, that Tehran was secretly running a program intended to produce nuclear weapons by next year.

"There is no place for weapons of mass destruction in Iran's defense doctrine," Asefi said, according to the official Islamic Republic News Agency.

Daryl Kimball, executive director of the Arms Control Association, told FOX News that it's still unknown the exact extent of the program.

"We simply don't know at this stage," he said, noting that U.S. reports of Iraq having weapons of mass destruction have thus far proven to be inaccurate. "I think we need to be sober about this information."

But the fact that the International Atomic Energy Agency (search) got so involved in Iran's weapons programs is a prime example of how Tehran's nuclear ambitions are no secret, Powell noted.

"So I think that the Iranians still have much more to do to convince the international community that they are not moving in the direction of a nuclear weapon, and they will comply with their obligations to the IAEA, and they will this time meet the commitments they are making to the European Union," Powell added.

Britain, France, Germany and the European Union have struck a deal with Iran that is designed to stop the nuclear enrichment program. The agreement, which takes effect Monday, prohibits Iran from all uranium gas processing activities.

"We'll be following this with a certain degree of caution — not in opposition to what's going on, but with necessary, deserved caution, because for 20 years the Iranians have been trying to hide things from the international community," Powell told reporters en route to Chile. "And it is the United States, rather than us being a problem, we have been the ones who have been pointing out to the world since 2001, when the president came into office, that there was a problem in Iran."

John Pike, founder of Globalsecurity.org, said the United States has every reason to be wary of the agreement.

"This is a more ambitious, more far-reaching agreement" than previously attempted, Pike said, noting that the Iranians are under no legal obligation to adhere to the deal.

"My concern is that the Iranians are just playing the Europeans along and that the agreement's going to fall apart within a few months," he said.

Kimball said the IAEA should be able to finish its job inspecting Iran and that diplomacy is still the best tool in the American arsenal to wield.

"Even if [Powell's information] is true, it is not all that surprising. Iran has had a missile program for some time. We've known about their uranium enrichment activities," Kimball said. "The real question is, what the United States and its allies can do about the situation."

"The United States, I think, really needs to take a look at the opportunity here and it should complement, not complicate, the European approach while we at the same time make sure Iran does not violate its nonproliferation commitments and the European deal," Kimball added.

Report: Iran Producing Nuke Gas

Diplomats told The Associated Press on Friday that Iran was exploiting the window until Monday to produce significant quantities of uranium hexafluoride — a gas that can be used to make nuclear weapons — at its plant in the central city of Isfahan (search).

Asked about quantities, one diplomat said "it's not little," but he declined to elaborate.

When introduced into centrifuges and spun, uranium hexafluoride can be enriched into weapons-grade uranium that forms the core of nuclear warheads

Iran has huge reserves of raw uranium and has announced plans to extract more than 40 tons a year. Tehran has maintained in the past that it was pursuing a nuclear program as a source of electrical power in the country.

Pike agreed with Powell that Tehran's nuclear aspirations are no secret and that it's expected the country would be planning delivery system for its weapons.

"This is the missile that North Korea has been developing for over a decade for delivering its atomic bombs," as well as the same type of missile Pakistan has been working with Pyongyang on developing, Pike said. "It's inconceivable that Iran is not working on the very same missile for the very same reason."

Pike noted that those nuclear facilities inside Iran are very similar to those in Pakistan that produce uranium and plutonium — the two main ingredients of an atomic bomb.

"I don't think anyone knows for sure how far away they are" from completing their work on such a weapon, Pike said of Iran. But he said evidence suggests that the pieces could be in place for completion within a year to 18 months.

On another note, Powell plans to attend a conference on Iraq on Monday and Tuesday at Egypt's Red Sea resort of Sharm el-Sheik.

State Department spokesman Adam Ereli said he's not aware of any plans by Powell to raise his nuclear concerns directly with Iranian diplomats who are expected to attend the conference.

FOX News' Toni Delancey and The Associated Press contributed to this report.