UN Secretary-General Kofi Annan said on Thursday Iran's top nuclear negotiator told him that Iran is still interested in negotiations with the European Union (EU) on its controversial nuclear program.

Annan said Ali Larijani affirmed to him in a 40-minute telephone conversation earlier in the day that Tehran was interest in "serious and constructive negotiations" with the EU troika -- France, Germany and Britain.

"Basically, I called him to urge him to avoid any escalation (of the nuclear dispute), to exercise restraint, to go back and give the negotiations a chance, and that the only viable solution lies in a negotiated one," Annan told reporters after a luncheon with envoys of Security Council members.

"He in turn affirmed to me that they are interested in serious and constructive negotiations, but within a time frame, indicating that the last time they did it for two and a half years and no result, but (he) did indicate they were also interested in negotiations and they were serious about it."

While stressing the crisis surrounding Iran's nuclear program should be resolved in the context of the International Atomic Energy Agency (IAEA), Annan hinted that he is not opposed to the referral of Iran to the Security Council.

"I think we should try and resolve it, if possible, in the IAEA context," he said. "Once that process is exhausted, it may end up in the (Security) Council and then I would leave it to the council, to decide what to do, if it were to come here."

Annan later briefed the permanent representatives of Britain, Russia and the United States on his conversation with Larijani.

The dispute over Iran's nuclear issue escalated this week after IAEA inspectors confirmed on Tuesday that Iran started to remove IAEA seals on enrichment-related equipment and material at Natanz.

At a meeting in Berlin Thursday, foreign ministers of Germany, France and Britain decided to ask the IAEA to bring Iran before the Security Council to face possible sanctions for resuming enrichment-related activities.

The three ministers, along with Javier Solana, European Union chief diplomat, called for an emergency session of the IAEA to vote on referring Iran to the Security Council.

(Xinhua News Agency January 13, 2006)