Iran will never again suspend conversion of uranium ore, but it is willing to pursue talks with the European Union (search) about its uranium enrichment program, Tehran (search) officials said Sunday.

The comments came as Iran's new president, Mahmoud Ahmadinejad (search), nominated hard-liners for all his key ministries, signaling the likelihood of an intensified confrontation with the United States and Europe over the nuclear program.

Iran already rejected Thursday's resolution from the U.N. nuclear agency urging it to halt the conversion of uranium into gas at its atomic plant in Isfahan. Conversion is a step before enrichment, which produces material usable for both energy-producing reactor fuel and atomic bombs.

After the International Atomic Energy Agency's board issued its appeal, diplomats familiar with the proceedings said Iran was being given until Sept. 3 to halt uranium conversion or risk being referred to the U.N. Security Council (search) for consideration of sanctions.

Washington and others have long suspected Iran's nuclear program is intended to develop weapons, and European governments grew concerned after it was revealed the Iranians had kept parts of its atomic operations hidden from U.N. inspectors.

Iran denies it is working on nuclear arms, saying the program's sole purpose is to generate electricity. It insists it has a sovereign right under the Nuclear Nonproliferation Treaty to convert uranium at Isfahan and do enrichment at its plant in Natanz for peaceful activities.

"The Isfahan issue is over. What is left on the table for discussion is Natanz," Mohammad Saeedi, deputy head of the Atomic Energy Organization of Iran, told state television.

"We definitely have plans for Natanz in the near future," he added, although he did not give a time frame.

The Foreign Ministry's spokesman, Hamid Reza Asefi, also said Iran would not stop uranium conversion.

"Work in Isfahan will not be suspended again for confidence building," he said, referring to the suspension of nuclear activities that Iran imposed last year to allow negotiations with the European Union to proceed in a good atmosphere.

Asefi said at a news conference that Iran had no set plans for resuming uranium enrichment in Natanz. "Europe's behavior will heavily influence the decision," he said.

Iran's chief delegate to the IAEA, Sirus Nasseri, indicated Thursday that any talks about enrichment would be about setting safeguards for operations at the Natanz facility to reassure those with suspicions but not about closing the plant.

The EU, lead by Britain, Germany and France, has been trying to persuade Iran to abandon its enrichment program in return for a supply of nuclear fuel to power reactors and other economic help.

Iran rejected the offer earlier this month, objecting to the Europeans' insistence it give up its uranium conversion and enrichment programs. The IAEA then issued its warning.

German Chancellor Gerhard Schroeder said he hoped Iran would change its mind.

"Nobody can deny Iran the peaceful use of atomic energy, but we must ensure that Iran is not put in the position to be able to manufacture atomic weapons," he said in an interview published Sunday by the Bild am Sonntag newspaper.

Schroeder also stressed the need to solve the standoff diplomatically and avoid threats of military action.

President Bush said on Israeli TV on Friday that "all options are on the table" in dealing with Iran, but the German leader disagreed.

"I see a military option a high-grade danger," Schroeder said. "Therefore I can certainly rule out that a German government under my leadership would take part in one."