VIENNA, Austria - Iran's nuclear project has developed its own version of an advanced centrifuge to churn out enriched uranium much faster than its previous machines, diplomats and experts said Thursday.

They said that few of the IR-2 centrifuges were operating and that testing appeared to be in an early phase, with the new machines rotating without processing any uranium gas.

More significant, the officials said, is the fact that Iran appears to have used know-how and equipment bought on the nuclear black market in combination with domestic ingenuity to overcome daunting technical difficulties and create highly advanced centrifuges.

Iran's uranium enrichment work has raised concerns in Washington and other Western capitals because it can produce the radioactive material needed for nuclear bombs. Tehran says it is only pursuing lower-level enrichment to make fuel for atomic reactors that will generate electricity.

Iran is under two sets of U.N. Security Council sanctions for refusing to suspend uranium enrichment, which it started developing during nearly two decades of covert nuclear activity built on illicit purchases and revealed only five years ago.

That secrecy heightened suspicions about Iran's intent, but Iranian leaders argued the country has a right to run a peaceful enrichment program and dismissed the U.N. demands, saying they planned to expand the project rather than freeze it.

Up until recent weeks, Iran had publicly focused on working with P1 centrifuges - outmoded machines that it acquired on the black market in the 1980s. Workers set up more than 3,000 of the machines in the large underground hall near Natanz, a city about 300 miles south of Tehran.

But diplomats told The Associated Press that Iranian experts now are testing a small number of more advanced IR-2 machines. They described it as a hybrid of the P-2 centrifuge once peddled on the black market by A.Q. Khan, the scientist who oversaw Pakistan's development of nuclear weapons.

The diplomats, who agreed to discuss the development only if granted anonymity because they weren't authorized to divulge the confidential information, said it was unclear whether the new generation centrifuges were in the underground facility or an aboveground pilot site at Natanz.

The P-2 centrifuge sold by Khan can enrich uranium gas up to three times faster than a P-1, but it is made from maraged steel - a high-nickel, low-carbon steel that is difficult to manufacture and hard to smuggle through international controls.

One of the diplomats said the Iranians had circumvented that problem by making the centrifuge's rotor tubes out of carbon fiber, presumably using machines and technology developed for Tehran's missile sector and using a German version as a model.

A former U.N. nuclear inspector, David Albright, said the ingenuity demonstrated by such a development was impressive.

"If you learn how to make carbon fiber rotors, you are very far ahead," said Albright, whose Washington-based Institute for Science and International Security tracks countries under nuclear suspicion. "They are much cheaper and easier to make, and you can learn to spin them very fast."

Using a hypothetical example of the efficiency of a P-2-based centrifuge compared with the P-1, Albright said 1,200 of the more advanced machines could produce enough material for a single nuclear warhead in a year, compared to 3,000 of the older model.

Iran has stonewalled the U.N. nuclear watchdog agency for years on details of its centrifuge development program, but in recent months has shown more cooperation under a plan agreed to last year that commits Tehran to lifting the veil of secrecy on all past nuclear activities.

Last month, the International Atomic Energy Agency's chief, Mohamed ElBaradei, was given new information on Iran's "new generation of centrifuges" during talks in Tehran - a priority as the agency tries to establish how far along Iran is in developing the technology.

ElBaradei is to report on the progress of his probe next month to the 35-nation IAEA board.

Ali Ashgar Soltanieh, Iran's chief representative to the IAEA, declined to discuss specifics of the probe but told AP that "we have made good progress."