A new UN atomic watchdog report showing Iran\'s continued efforts to enrich uranium offers reason for concern as well as hope, analysts said Wednesday, as long-stalled talks were due to resume. In its quarterly report, seen by AFP, the International Atomic Energy Agency (IAEA) said Iran had installed hundreds more centrifuges since May that could enable it to enrich uranium faster. \"Iran has continued to install IR-2m centrifuges in one of the units\" at the Natanz site in central Iran, the IAEA said, putting the figure now at 1,008, up from 689 in its last report in May. \"None of the IR-2m centrifuges... had been fed\" with natural uranium, it noted however. The new-generation centrifuges are of particular concern as they would allow Tehran to enrich uranium at a faster rate, allowing it to obtain the amount of fissile material needed for a nuclear bomb more quickly, if it wished to go down that path. Western countries suspect Iran is trying to develop an atomic bomb but Tehran insists its nuclear programme is solely for peaceful purposes. Earlier Wednesday, the IAEA said that talks with Iran over its controversial nuclear programme -- on hold since May -- would resume on September 27. \"Given the nature and extent of credible information available to the Agency about possible military dimensions to Iran\'s nuclear programme, it remains essential and urgent for Iran to engage with it on the substance of the Agency\'s concerns,\" the IAEA urged ahead of the meeting. Parallel talks between Tehran and the six powers -- the so-called P5+1 composed of the United States, Russia, China, Britain, France and Germany -- have also been stalled since April. According to the IAEA report, Tehran has so far produced 372.5 kilogrammes of 20 percent-enriched uranium, up from 324 kilogrammes in May. This is not yet the 90-percent enriched uranium needed for a nuclear bomb but gets Iran much closer, technically, to that point. With part of the stockpile converted further for fuel purposes however, only 185.8 kilogrammes of 20-percent enriched uranium remain. \"Iran is making sure to keep the total stockpile of 20-percent enriched gasified uranium well below the 240kg redline that would be enough for a nuclear weapon,\" Mark Fitzpatrick of the International Institute for Strategic Studies (IISS) told AFP. Tehran also informed the IAEA that the Arak heavy-water reactor -- another site of concern as it could produce plutonium for a nuclear device -- would not become operational in the first quarter of 2014 as planned, the report said. \"This is a positive development,\" said the Washington, DC-based Institute for Science and International Security (ISIS), noting that the loading of the reactor could trigger an Israeli strike. Both Israel and the United States have refused to rule out military strikes against Iranian nuclear facilities. \"An airstrike would be cleaner if it happened before the reactor starts up, after which any bombing would spew hazardous radiation,\" said Fitzpatrick. \"In other words, the delay extends the diplomatic timeline.\" The installation of the new-generation IR-2m centrifuges, as well as older IR-1 centrifuges at Natanz -- now numbering 15,416 from 13,555 three months ago -- was more worrying, the ISIS said. \"Iran is on track to achieve a \"critical capability\" as of mid-2014, or perhaps sooner,\" it predicted, referring to the point where Iran would be able to produce enough weapons-grade uranium for an atomic bomb before inspectors could detect it. The report was \"a mixed bag of developments\", the think tank concluded. Iran has been hit by four rounds of UN sanctions, as well as EU and US sanctions on its oil and banking sectors. The UN Security Council has also passed several resolutions urging it to halt enrichment. Western powers hope however that Iran\'s new president Hassan Rowhani, who replaced the firebrand Mahmoud Ahmadinejad, could breathe new life into efforts to resolve the nuclear issue. During his role as Iran\'s chief nuclear negotiator from 2003 to 2005, Rowhani accepted the suspension of the enrichment programme. An international official close to the dossier said Wednesday that the agency would be \"anxious to see\" how negotiations will be carried out under the new president and \"how that is going to affect\" talks. The report by the IAEA\'s director-general Yukiya Amano comes ahead of a meeting of the watchdog\'s 35-member board of governors on September 9-13 in Vienna.