Iran will hand an official letter to the International Atomic Energy Agency chief on Monday about its nuclear fuel swap agreement with Brazil and Turkey, the official Irna news agency reported on Friday.

Leaders of the three countries announced the agreement, under which Iran will send some of its enriched uranium to Turkey in exchange for fuel rods for a Tehran medical research reactor, on Monday.

UN Secretary-General Ban Ki-moon said in Istanbul on Friday he hoped the deal would open the way to a negotiated settlement of Iran's row with the West over its nuclear programme.

But the five permanent members of the UN Security Council, after months of negotiations, agreed a draft resolution on a new set of sanctions against Iran that Washington handed to the Security Council on Tuesday.

"After the joint announcement of Iran, Turkey and Brazil, Iran's permanent ambassador to the International Atomic Energy Agency announced the country's readiness to submit the letter to the agency," Irna reported.

"In a meeting with the agency's chief Yukiya Amano on Monday, Iran will hand over the letter," the news agency added.

Western powers fear that Iran is secretly trying to produce nuclear weapons, but Tehran denies this and says it is enriching uranium only to produce fuel for nuclear power stations.

Under the agreement, the first batch of Iran's uranium would arrive in Turkey within a month, in return for fuel rods to keep a Tehran medical research reactor running.

Such an arrangement was first mooted last October as a way to cut Iran's uranium stockpile below the minimum that would be needed for a nuclear weapon if enriched to a high fissile purity -- and buy time for more negotiations.

Turkey and Brazil -- both currently non-permanent members of the Security Council -- and Iran have urged a halt to talk of further sanctions because of the deal, but Western powers suspect it is an Iranian tactic to avert or delay sanctions.

The new, extended sanctions would target Iranian banks and call for inspection of vessels suspected of carrying cargo related to Iran's nuclear or missile programmes.

Iranian officials have dismissed the draft resolution as lacking legitimacy, and rejected international demands that it suspend enrichment. – Reuters